The export orders and factory production posted their slowest growth in a year last month as concern about the war with Iraq curbed US demand for Taiwan's personal computers and mobile phones.
Export orders, an indicative of shipments in one to three months time, rose 6.1 percent from a year earlier to US$13.49 billion after a 9.9 percent gain in February, while production increased 1.59 percent after growing a revised 9.2 percent, the Ministry of Economic Affairs said in a statement.
The government is counting on rising exports to meet its 3.68 percent economic growth projection for this year. That forecast assumes overseas sales, which account for about half of the nation's gross domestic product, will rise 7.4 percent this year.
"US demand is weakening quite sharply," said Ma Jun, an economist at Deutsche Bank in Hong Kong.
Shipments to the US, Taiwan's second-biggest overseas market after China, fell in three of the last four months as American consumers cut back on their spending. Retail sales in the US fell in the first two months of this year and consumer confidence dropped to a nine-year low in March.
Taiwan's export orders from the US fell 8.4 percent to US$3.75 billion last month, the statement said.
As US demand falters, Taiwan is selling more mobile phones, notebook computers, galvanized steel products and other goods to China, whose economy grew 9.9 percent in the first quarter.
Taiwan companies' export orders from Hong Kong rose 11.39 percent to US$3.05 billion in March from a year earlier, the statement showed. Most shipments to China from Taiwan go through Hong Kong because of transport restrictions across the Taiwan Strait.
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