The Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) yesterday revised downward its forecast for GDP growth this year to 4.29 percent from the 4.55 percent it forecast in December, citing the impact from Japan’s massive earthquake and tsunami.
“The nation’s economic growth this year will be negatively affected by Japan’s earthquake, especially in the second quarter,” Wang Lee-rong (王儷容), director of the institute’s center for economic forecasting, told a media briefing.
The Taipei-based think tank expected GDP growth to rise 3.94 percent in the second quarter and 4.49 percent in the second half of the year because of a lower base and strong exports, Wang said.
The institute’s research model was based on the IHS Global Insight’s latest forecast, which revised Japan’s GDP growth downward to zero this year from 1.1 percent growth, CIER researcher Peng Su-ling (彭素玲) said.
As a result of this change, the institute cut its GDP forecast for Taiwan by 0.31 percentage points, Peng said.
Taiwan’s GDP growth could drop even lower if the Japanese economy falls further in the wake of the radioactive disaster and ensuing power shortage, Wang said.
“At the most, Taiwan’s GDP growth could decrease by 0.64 percentage points for this year, on the assumption that Japan’s full-year GDP contracts by 1.5 percent,” Wang said.
Although researchers generally thought the Japanese quake would only have a limited impact on the global economy, Su Hsien-yang (蘇顯揚), director of the institute’s Japan center, said the Taiwanese economy would be more affected because of the close connection to Japan’s supply chain.
Taiwan should grab the opportunity to learn more high-level skills from Japan, as it plans to deepen its cooperation with other countries after the quake, Su said.
As to Standard & Poor’s negative outlook on US government debt, Wang said this could also have a negative impact on Taiwan’s GDP growth, but it was too early to provide estimates.
The institute expected Taiwan’s full-year inflation to grow at a steady 1.78 percent, while the wholesale price index could increase 3.35 percent this year.
DECOUPLING? In a sign of deeper US-China technology decoupling, Apple has held initial talks about using Baidu’s generative AI technology in its iPhones, the Wall Street Journal said China has introduced guidelines to phase out US microprocessors from Intel Corp and Advanced Micro Devices Inc (AMD) from government PCs and servers, the Financial Times reported yesterday. The procurement guidance also seeks to sideline Microsoft Corp’s Windows operating system and foreign-made database software in favor of domestic options, the report said. Chinese officials have begun following the guidelines, which were unveiled in December last year, the report said. They order government agencies above the township level to include criteria requiring “safe and reliable” processors and operating systems when making purchases, the newspaper said. The US has been aiming to boost domestic semiconductor
Nvidia Corp earned its US$2.2 trillion market cap by producing artificial intelligence (AI) chips that have become the lifeblood powering the new era of generative AI developers from start-ups to Microsoft Corp, OpenAI and Google parent Alphabet Inc. Almost as important to its hardware is the company’s nearly 20 years’ worth of computer code, which helps make competition with the company nearly impossible. More than 4 million global developers rely on Nvidia’s CUDA software platform to build AI and other apps. Now a coalition of tech companies that includes Qualcomm Inc, Google and Intel Corp plans to loosen Nvidia’s chokehold by going
ENERGY IMPACT: The electricity rate hike is expected to add about NT$4 billion to TSMC’s electricity bill a year and cut its annual earnings per share by about NT$0.154 Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) has left its long-term gross margin target unchanged despite the government deciding on Friday to raise electricity rates. One of the heaviest power consuming manufacturers in Taiwan, TSMC said it always respects the government’s energy policy and would continue to operate its fabs by making efforts in energy conservation. The chipmaker said it has left a long-term goal of more than 53 percent in gross margin unchanged. The Ministry of Economic Affairs concluded a power rate evaluation meeting on Friday, announcing electricity tariffs would go up by 11 percent on average to about NT$3.4518 per kilowatt-hour (kWh)
OPENING ADDRESS: The CEO is to give a speech on the future of high-performance computing and artificial intelligence at the trade show’s opening on June 3, TAITRA said Advanced Micro Devices Inc (AMD) chairperson and chief executive officer Lisa Su (蘇姿丰) is to deliver the opening keynote speech at Computex Taipei this year, the event’s organizer said in a statement yesterday. Su is to give a speech on the future of high-performance computing (HPC) in the artificial intelligence (AI) era to open Computex, one of the world’s largest computer and technology trade events, at 9:30am on June 3, the Taiwan External Trade Development Council (TAITRA) said. Su is to explore how AMD and the company’s strategic technology partners are pushing the limits of AI and HPC, from data centers to