The government is turning its attention to export growth in emerging markets this year in the hopes of boosting economic performance by shifting away from a reliance on developed markets.
The Ministry of Economics Affairs yesterday named 10 emerging markets that it said will be key to export-driven Taiwan this year: China, Indonesia, India, Vietnam, Myanmar, the United Arab Emirates, Egypt, Russia, Brazil and Mexico.
The ministry hopes that leveraging competitive advantages in those markets will help it hit its 4.2 percent export growth goal, a high bar considering official forecasts of 3.07 percent growth for the year.
The ministry is organizing promotional events for leading exporters and also plans to relocate some of its overseas employees from developed countries to key emerging markets.
Yet the strategy shift does not mean that Taiwan will give less weight to mature markets such as the US, the EU or Japan. As an export-oriented economy, Taiwan “cannot emphasize one at the expense of another,” the ministry said.
According to Ministry of Finance data, exports reached to US$24.31 billion last month, a 7.9 percent drop from December last year and a 5.3 percent drop from a year earlier, while imports totaled at US$21.34 billion, a monthly drop of 11.8 percent and an annual decrease of 15.2 percent.
While the government attributed the declines to lukewarm demand in regional markets over the Lunar New Year holiday, some business representatives said slowing imports of equipment and machinery last month reflected a sluggish global economy and a worsening local business environment.
Imports of capital equipment — an indicator of the momentum of investment — last month plunged 15.2 percent annually to US$2.72 billion, snapping two straight months of growth.
Chief among the items that suffered the decline were transportation equipment imports, which fell 53.3 percent last month from the same period the previous year, and machinery, which fell 15.2 percent.
Taiwan Electrical and Electronic Manufacturers’ Association deputy secretary-general Luo Huai-jia (羅懷家) attributed the yearly dive partly to a global downturn last year, which he said held some manufacturers back from investments.
Luo did not expect a recovery in the short term, as the US Federal Reserve’s scale-down of its monetary easing measures means it is “not a good time” for purchasing equipment.
Chinese National Federation of Industries secretary-general Tsai Lien-sheng (蔡練生) pointed his finger at environmental regulations and worker salaries alongside a “worsening business environment,” lowering profits and making the equipment import decline “predictable from early on.”
Tsai blamed increasing salaries for workers and the costs of maintaining environmentally friendly operations in Taiwan, developments which he said are causing an increasing number of manufacturers to shift production to China and Vietnam and to buy equipment overseas.
Increased costs from labor, among other factors, made companies less willing to invest and give raises, which would hurt bottom lines and competitiveness, he said.
He also criticized government policies to protect dispatched workers, arguing that the cap on how many dispatched workers are allowed — 3 percent of a company’s employees — took away work opportunities.
“If the government wants to focus on the economy, officials should first learn their economics,” he said.
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