The National Development Council’s (NDC) index of economic monitoring indicators last month showed “green” for the second consecutive month, indicating gradual growth of the nation’s economy.
That status is expected to continue this month on the back of rising exports as economies in the US and Europe improve and export orders in China grow, council Chief Secretary Kao Shien-quey (高仙桂) told a press conference yesterday.
However, Kao said the economic slowdown in China and Southeast Asian countries remained risks to Taiwan’s economy.
The council uses a five-color spectrum to categorize the nation’s economic health, with “blue” signaling recession, “green” steady growth and “red” overheating, while “yellow-blue” indicates a transition between recession and growth and “yellow-red” represents a transition between growth and overheating.
Last month’s score held at 25 points, the council’s report said. Although the score of “imports of machinery and electrical equipment” increased two points last month, that increase was offset by the declining year-on-year export growth and lower industrial production, the report showed.
The index of leading economic indicators, which is used to gauge the nation’s short-term economic outlook, posted its 19th consecutive increase — to 101.16 points last month — up 0.1 percent from 101.06 points a month ago, the council said.
The index of coincident indicators, which reflects monthly economic conditions, reported its first decline — to 100.4 points — after seven consecutive increases last month, down 0.04 percent from 100.45 points a month earlier, the council added.
Gordon Sun (孫明德), director of the Taiwan Institute of Economic Research’s (TIER, 台灣經濟研究院) economic forecasting center, said the nation’s economic outlook is positive.
Sun said the lower year-on-year export growth last month should not be a worry, because the first quarter of every year has low demand for exports.
“The rising imports showed that local companies increased their inventory level and investments, which will push up exports this quarter,” Sun said.
Sun said the rising economic condition in the US and Europe can help exports of the electronics industry, which accounts for half of Taiwan’s manufacturing sector.
Sun said as the index of leading indicators of five major Asian countries — China, India, Indonesia, Japan and South Korea — dropped by only 0.01 percent to 99.39 points in February, the slowdown is still mild and will not have significant effects on Taiwan.