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Forecast for export order growth may be increased

Export order growth in Taiwan was higher than the government expected last month and the full-year forecast for overseas shipments may be increased, the government said yesterday.

Orders, indicative of shipments in one to three months, climbed 8.17 percent from a year earlier after increasing 17 percent in January, the government said.

"We will probably see double-digit export order growth in March, driven by a recovery in demand for electronic and IT products," said Chang Yaw-tzong (張耀宗), the Ministry of Economic Affairs' statistics chief.

"We had a better-than-expected February," Chang said.

There is also a "high possibility" that the government's forecast for export growth this year will be raised, he said.

The current prediction is that overseas shipments may increase at only half of last year's pace because of a slowing economy in the US, Taiwan's second-biggest market.

Economists often combine the first two months' figures to remove distortions caused by the timing of the Lunar New Year holiday.

Export orders rose 12.92 percent in January and last month, compared to a 23 percent gain in the same period of last year.

The holiday's timing, which cut five working days from the month, contributed to the slower growth last month.

Orders for electronics products rose 7.85 percent last month after climbing 20 percent in the previous month.

Those for information technology products gained 21.83 percent after rising 23 percent.

Vickie Hsieh, an economist at President Investment Trust Corp (統一投信), described growth for the first two months as "healthy."

Overseas shipments, which account for about half of the total economy, are expected to grow 6.2 percent this year, the government said last month. Electronics are the biggest export.

The Federal Reserve this week kept the benchmark US interest rate unchanged and abandoned a bias toward higher borrowing costs, suggesting officials see a growing risk that an economy weakened by a recession in residential real estate will slow further.

Gross domestic product grew at an annual rate of 2.2 percent in the fourth quarter, less than previously estimated.

Export orders from the US grew 7.6 percent after gaining 9.7 percent in January, the government said.

European orders increased 17.12 percent after rising 25 percent in the previous month. Orders from Hong Kong climbed 7.69 percent after rising 34 percent.

Japanese orders rose 4.32 percent after sliding 11 percent.

Taiwan's industrial production fell 2.77 percent last month after climbing a revised 5.6 percent in the previous month.
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