Industrial output expanded 1.89 percent last month from a year earlier driven by strong demand for electronic parts as major technology firms launched new generation devices, the Ministry of Economic Affairs (MOEA) said yesterday.
Industrial production, a critical gauge of the health of the nation’s export-oriented economy, swung to the positive zone for the second straight month after July’s revised reading of 0.13 percent growth, from a preliminary 0.02 percent decline, said Yang Kuei-hsien (楊貴顯), deputy director-general of the ministry’s statistics department.
“The industrial production index climbed to 136.6 in August, the second-highest level since the peak of 139.9 in March last year, thanks to robust sales of smartphones and tablet computers,” Yang told a media briefing.
Information and communications output grew 5.31 percent last month from a year earlier while petrochemical production gained 5.53 percent, the ministry’s report said.
Local suppliers of IC packaging services and critical components such as flat panels benefited most from the pickup as evidenced by the sub-index’s record 9.9 percent increase, Yang said.
The improved industrial output figures came after Apple Inc and Taiwanese smartphone maker HTC Corp (宏達電) unveiled their newest mobile devices earlier this month.
The growth momentum may last through the fourth quarter although the pace may ease a bit this month based on the ministry’s sentiment survey, Yang said.
About 23 percent of the manufacturers expect output to shrink this month when compared with last month, while 11 percent hold the opposite view, the report said.
A big majority, 66 percent, said output is likely to flatten this month, the report added.
The petrochemical sector also showed signs of recovery amid stable international oil prices, Yang said.
However, demand for basic metal, computer products and machinery equipment remained weak as their sub-indexes fell 11.9 percent, 13.96 percent and 7 percent respectively from a year ago, the report said.
Moody’s Analytics gave a forecast of a 0.5 percent decline in industrial production and said the latest reading suggested Taiwan has turned a corner and the current quarter may fare better than expected, despite export order data.
Furthermore, stimulus measures in China may filter through to stronger regional growth, lifting production later in the year, Katrina Ell, an economist at Moody’s Analytics, said.
On the domestic front, revenue for wholesale, retail and restaurant sectors fell 1.2 percent to NT$1.2 trillion last month, from a year earlier, dragged by firms in wholesale trade, the ministry said in a separate report.
Retailers and restaurants reported an increase of 3.9 percent and 5.4 percent respectively, attributable to growing tourism revenues, the report said.