The nation’s export orders grew less than expected last month, and slight falls in export orders from China, the US and Europe compared with June underscore the risk for export-oriented Taiwan’s economic growth in the second half of the year.
Export orders are an indicator of outbound shipments one to two months ahead, and the fresh data for last month offer a good guide to both the external sector in Taiwan, as well as the general situation of Asian exports.
Orders for last month rose 5.7 percent from a year earlier to US$38.18 billion, the Ministry of Economic Affairs said in a report issued yesterday.
The growth rate was slower than the 10.6 percent annual rise recorded in the previous month and the value of last month’s orders was down 1.6 percent from US$38.82 billion in June, the report showed. Cumulative orders for the first seven months of the year reached US$258.64 billion, up 5.5 percent from a year earlier, the ministry said.
The slower pace of increase in export orders last month comes after the government said last week that the economy is set to pick up steam significantly this quarter as the upcoming launch of new iPhones is expected to maintain Taiwan’s external demand.
For this month, the ministry said 59.2 percent of all firms polled forecast that orders would flatten out this month from last month, while 20.7 percent forecast an increase and another 20.1 percent projected a sequential decline, according to a survey conducted recently by the ministry among domestic manufacturers.
However, JPMorgan Chase & Co said in a recent note that it forecast Taiwan’s economic growth would expand 3.8 percent this year, down slightly from its previous estimate of 4 percent, because potential volatility in external demand this quarter in the wake of a near-term uncertainty in eurozone economies could affect the sustainability of an upturn in Taiwan’s export and manufacturing sector in the coming months.
The report showed Taiwan’s export orders from Europe grew 3.2 percent year-on-year to US$6.32 billion last month, but the figure declined by the largest pace of 7.9 percent from June compared with other major overseas markets.
Export orders from the US last month rose 1.5 percent to US$9.21 billion from a year earlier, but dropped 2.1 percent from June, while those from China totaled US$10.17 billion last month, up 9.2 percent year-on-year, but down 0.4 percent month-on-month.
By product, orders for electronics expanded by 11.2 percent annually to US$9.57 billion last month and those for machinery increased by 18.1 percent to US$1.98 billion, while those for precision equipment decreased by 7.8 percent year-on-year to US$2.71 billion, and orders for information and communication products dropped 0.5 percent annually to US$9.11 billion last month, the report showed.
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