Taiwan’s domestic trade — including the retail, wholesale and restaurant sectors — dropped 9.52 percent year-on-year to NT$992 billion (US$30.8 billion) last month as a slowing economy continued to cut consumer spending, the latest economic data showed.
But compared with March, last month’s figure represented an increase of 1.73 percent, the Ministry of Economic Affairs said yesterday.
The ministry’s data showed the wholesale sector, the largest component of domestic trade, had experienced the steepest year-on-year decline at 12.19 percent to NT$705.88 billion.
It was followed by a decline of 2.57 percent in the retail sector to NT$259.97 billion, while there was a 1.62 percent rise in restaurant sector revenue at NT$26.2 billion for the month.
“Taiwanese producers are strained by a slowing global economy and a domestic economy in a deep recession,” Tine Olsen, a Sydney-based economist at Moody’s Economy.com, said of the continued contraction in Taiwan’s wholesale trade.
In March, wholesale trade shrank 15.2 percent to NT$693.57 billion, the ministry’s report showed.
Olsen said the retail sector still faced challenges from weaker consumer purchasing as many workers are uncertain of their future income, although a narrower decline last month in this sector than the previous month’s 3 percent decline could be a good sign, he said.
“The smaller drop in retail sales in April compared to previous months could indicate that the improving labor market and recent gains in share prices are making shoppers return to the malls,” she wrote in the statement.
Unemployment data released yesterday by the Directorate-General of Budget, Accounting and Statistics showed that unemployment edged down slightly to 5.76 percent last month from the previous month’s 5.81 percent, hinting that the local labor market was stabilizing amid positive news that some companies are re-hiring former employees.
But it is too early to expect consumers to completely resume purchasing and retailers will likely be subdued until the labor market improves, Olsen said, adding that the government’s shopping vouchers program exercised earlier this year may only have provided temporary relief for the sector.
From January through last month, the accumulated domestic trade saw a decline of 12.41 percent compared with the same period last year at NT$3.82 trillion, with the wholesale sector suffering the sharpest annual drop of 15.84 percent to NT$2.65 trillion, ministry data showed.
Other than the medicine and cosmetics category, which increased 6.74 percent, other wholesale categories all showed negative growth.
During the first four months, the retail sector saw revenues fall 3.73 percent to NT$1.06 trillion, while the restarurant sector reported that sales dipped 1.4 percent to NT$111 billion, the ministry said.
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