Sat, Aug 08, 2009 - Page 12 News List

July exports declined by double digits

SLOW RECOVERY: Experts say that the slowing pace of decline in Taiwanese exports indicates a gradual improvement in business sentiment as the contraction slackens

By Crystal Hsu  /  STAFF REPORTER

The nation’s exports declined by double digits last month from a year earlier, but the pace of contraction slackened as the global economy continued to show signs of improvement, the Ministry of Finance said in a report on its Web site yesterday.

Outbound shipments dropped 24.4 percent to US$17.27 billion year-on-year last month as demand for Taiwan-made goods remained weak even though the value was the highest it has been in nine months, the report said. Last month’s figure was up 1.9 percent from US$16.95 billion in June, the report showed.

Jack Huang (黃蔭基), head of research at SinoPac Financial Holdings Co (永豐金控), said the latest data came in line with his forecast of a 23 percent decline and affirmed a slowdown in the recession.

Huang expected exports to shrink 18 percent this quarter from a year ago, but return to 9 percent annual growth in the fourth quarter.

“While the economy is still on the decline, it is getting better each month,” Huang said by telephone.

Consumer electronic products topped foreign sales at US$4.96 billion, or 28.7 percent, last month, followed by primary metal products at US$1.56 billion, or 9.1 percent, the report said.

Shipments to China including Hong Kong dropped 20.6 percent year-on-year to US$7.09 billion, accounting for 41 percent of all export value, the report said.

Exports to the US contracted 28.6 percent to US$1.96 billion, while shipments to Japan fell 20.2 percent to US$1.21 billion, the report said.

Meanwhile, exports to Europe and ASEAN countries sank 28.9 percent and 25.3 percent to US$1.79 billion and US$2.61 billion respectively, the report said.

For the first seven months of the year, exports decreased US$51.62 billion, or 32.8 percent, to US$105.75 billion, the data showed.

Imports amounted to US$15.24 billion last month, dropping 34.1 percent from the level a year earlier, leaving a trade surplus of US$2.03 billion for the month, the report said.

Huang welcomed the slower contraction in capital goods for last month, saying it shows improved business sentiment in Taiwan.

Imports of capital goods shrank 23.9 percent year-on-year to US$2.13 billion last month, compared with a decline of 29.5 percent to US$2.18 billion in June, the latest data showed. The annual decline in capital goods imports reached as much as 51.2 percent in April, the ministry said.

Tine Olsen, an economist at Moody’s based in Sydney, said the latest data indicated that external demand was growing at a faster pace than Taiwan’s domestic economy, which is still under unemployment pressure an uncertain earnings outlook.

“Exports are rebounding at a faster rate than anticipated and their recovery is pulling the island out of its deep recession,” Olsen wrote in a statement yesterday.

Additional reporting by Kevin Chen

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