Taiwanese factories last month saw output hitting their second-highest by expanding 17.2 percent from a year ago, thanks to consumers’ Lunar New Year buying spree, the Ministry of Economic Affairs said yesterday.
The industrial output index was 133.11 points last month, down 2.5 percent from December — the month that saw an index high of 136.58.
Huang Ji-shih (黃吉實), director-general of the ministry’s statistics department, said factories were roaring with last-minute production of products for this month’s festivities, and more orders were also placed in anticipation of another rise in raw material costs.
However, factory output this month is expected to drop because of fewer working days and the recall of flawed chipsets from Intel Corp that impacted PC production, he said.
“Many [factories] opted to reduce inventory holding after having ramped up production output to meet rising demand ahead of year-end holiday sales season,” Standard Chartered’s economist Tony Phoo (符銘財) said in a note yesterday.
The month-on-month drop last month suggested that on-going concerns over recovery prospects in key overseas markets, especially Europe, which is further aggravated by higher oil prices amid rising uncertainty with unrests in key oil-producing African states as well as the Middle East, he wrote.
Production of the manufacturing industry — which accounts for more than 90 percent of total factory output and includes the electronics, chemicals, machinery as well as food and textile sectors — rose 17.3 percent last month.
Output of electronic components — a major sub-sector under the manufacturing industry — was up 27 percent during the same period and that of machinery equipment climbed 33.6 percent.
“Taiwanese machinery products are value for money with good features over those from regional competitors, and the ECFA [Economic Cooperation Framework Agreement] is also a plus,” Huang said.
Some Taiwanese machinery products have been eligible for lower export tariffs to China since Jan. 1 because they are on the trade pact’s “early harvest” list.
The ministry said on Monday that export orders — an indication of orders to come in the next one to three months — hit a record US$34.46 billion last month, thanks to strong international demand for Taiwanese chemicals and machinery as well as rubber and plastics.
Yesterday, it released consumption figures for last month, which set a record high since 1999.
That was because Taiwan saw a huge increase in overseas tourists — 400,000, the highest figure ever reached in January, Huang said, adding that companies’ year-end dinner parties also added to the strong momentum.
Total sales for the wholesale, retail as well as food and beverage sectors totaled NT$1.21 trillion (US$40.4 billion).
It represented a rise of 13.1 percent from last year and up 1.3 percent from December, according to the department’s figures.
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