The percentage of manufacturers and service providers that feel pessimistic about their outlook for the coming six months was up last month, amid concerns that the global slowdown will dampen demand and that high raw material costs will cut into profit margins, an industrial report indicated.
The Taiwan Institute of Economic Research (TIER, 台經院), which surveys various sectors of the economy each month on the business climate, said in a report released yesterday that the percentage of pessimists rose to 29.4 percent, up from 28.2 percent in July.
Meanwhile, companies upbeat about their business prospects dropped to 21.6 percent, compared with 30.3 percent a month earlier, the report said, adding that firms with neutral expectations jumped from 41.5 percent to 49 percent.
Chen Miao (陳淼), a TIER researcher, attributed the trend to the weakening demand for communications products, stemming from the turmoil on financial markets worldwide.
“Though exports regained double-digit growth [at 18.4 percent] in August, more makers were cautious on the grounds that momentum could slow in the upcoming months,” Chen told a media briefing in Taipei.
The climate indicator for the manufacturing sectors slipped 2.3 points to 105.33 points last month, compared with 107.6 points in July, the report said.
While makers managed to increase their shipments to emerging markets, the high cost of fuel and raw materials continued to take its toll on their profitability, Chen said.
The climate index for the service sector shed 6.14 points to 100.21 points last month, compared with 113.76 points a month earlier, the report said.
TIER president David Hong (洪德生) said the decline in real wages prompted consumers to tighten their belts, a trend that is likely to persist.
The stimulus measures adopted by the government have failed to address this issue, Hong said.
The institute expected the NT dollar to continue devaluing in the short term.
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