Export orders shrank 3.1 percent to US$43.51 billion last month from the previous month as demand for electronics weakened in emerging markets, the Ministry of Economic Affairs said yesterday, adding that the decline is expected to extend into this month.
Weakness in external demand coupled with growing uncertainty about global economies led to the ministry’s cut on its forecast for the nation’s annual export orders this year to US$470 billion from an earlier estimate of US$480 billion.
“The monthly decrease in export orders was primarily because consumer electronics saw a contraction after the peak season,” Department of Statistics Director-General Lin Lee-jen (林麗貞) told a news conference.
The persistent decline in global crude oil prices also eroded Taiwan’s petrochemical, plastics and rubber sectors last month, Lin said.
Export orders totaled US$428.59 billion in the first 11 months this year, up 7 percent, or US$27.9 billion, from a year earlier, Lin said.
“Apart from the weak demand in emerging markets, the depreciation of Russia’s ruble against the US dollar and the decline of international oil prices could possibly constrain the momentum of global economic growth and affect Taiwan’s petrochemical export orders,” Lin said.
On an annual basis, last month’s export orders grew 6 percent, compared with last year’s NT$41.04 billion, the ministry said.
Lin said last month’s growth was mainly driven by orders from the information and communications technology sector, with orders reaching a new monthly record of US$13.69 billion, up 16.6 percent year-on-year and 6.1 percent month-on-month.
For this month, Taiwan’s information and communications technology sector will continue to grow in tandem with the robust demand for handheld devices from international brands, Lin said, citing the Christmas shopping season and the upcoming Lunar New Year holidays.
By sectors, orders for precision instruments dropped 5.3 percent to US$2.73 billion last month from October due to weak demand for touchpanels and fierce price competition for small-and-medium-sized panels, Lin said.
Petrochemicals and the plastics and rubber sector were dragged down by global oil prices and saw monthly declines of 5.2 percent and 7.3 percent respectively, Lin said.
The US remained Taiwan’s largest export destination last month, with export orders totaling US$11.77 billion, up 14.2 percent year-on-year, but down 5.3 percent month-on-month, data showed.
Export orders to Europe posted a monthly record of US$10.19 billion, overtaking China and Hong Kong’s as the second-largest destination for Taiwanese exports, Lin said.
Europe’s orders surged 19.3 percent from a year earlier and were up 7.1 percent from the previous month, driven mainly by strong demand for information and communications technology products.
China, including Hong Kong, saw the third consecutive monthly decline for Taiwanese orders, totaling US$9.63 billion, down 3.4 percent from last year and down 3.5 percent from the previous month, data showed.
Lin said China’s slower growth momentum affected its orders for Taiwanese products.
“That China is developing its own petrochemical industry and flat-panel industry also reduced its demand for Taiwanese products,” she said.
Looking ahead to next year, Lin said export orders are most likely to be driven by Taiwan’s information and communications technology and electronics sectors, as the two industries account for 51.6 percent of total export orders.
Lin said new products from international brands will likely boost Taiwanese manufacturers’ orders, highlighting the expectation that wearable electronics and cloud-computing related services will drive the sectors’ performance next year.
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