Exports declined 6.7 percent to US$19.86 billion last month from a year earlier, as the Lunar New Year holiday reduced the number of working days and falling crude prices sapped demand for petrochemical products, the Ministry of Finance said yesterday.
Exports, which account for more than 60 percent of GDP, might have difficulty recovering this month due to a higher base last year and prices for some electronics components softening, the ministry said.
“Holiday disruptions and cheaper oil prices account for the contraction in exports, which might fare worse than expected this quarter,” Department of Statistics Director Yeh Maan-tzwu (葉滿足) told a news conference.
The Directorate-General of Budget, Accounting and Statistics last month projected that exports might weaken 0.49 percent this quarter from a year earlier.
Yeh said that, based on the statistics so far, the decline is likely to be greater than previously forecast.
Exports totaled US$44.98 billion for the first two months, down by US$590 million, or 1.3 percent, from the same period last year, ministry statistics showed.
Yeh attributed the contraction to poorer mineral, chemical and plastic exports, which shrank US$2.79 billion in value, dragging exports down by 6.99 percentage points last month, despite gains in electronics shipments.
Electronics shipments grew 8.8 percent year-on-year to US$6.71 billion last month despite holiday and seasonal disruptions, the ministry said.
Machinery and optical exports lent support with increases of 9.5 percent and 5.4 percent to US$1.34 billion and US$1.22 billion respectively, the ministry said.
However, mineral and chemical shipments continued to decline by double digits, although oil prices showed sign of a rebound, the ministry said.
Mineral shipments fell 47.6 percent to US$960 million, while chemical exports shrank 23.9 percent to US$1.38 billion, the ministry said.
The contraction might slacken, as crude oil prices bounced to US$54 per barrel last month, from US$44 per barrel in January, giving customers more confidence to place orders, Yeh said.
Weakened exports are not entirely negative for GDP, as cheaper oil prices mean greater profit margins for companies and more leeway for consumer spending, Yeh said.
Imports weakened by a steeper pace of 22.4 percent last month to US$15.3 billion, raising trade surplus by US$4.56 billion, almost double the year-earlier level, the ministry said.
Trade surplus totaled US$9.4 billion, surpassing the amount recorded for the first quarter last year, and suggesting that falling oil prices are of more benefit than harm to GDP growth, Standard Chartered Bank economist Tony Phoo (符銘財) said in a note.
Australia and New Zealand Banking Group Ltd (ANZ) shared the optimism, saying Taiwan’s growth prospect remains positive.
Exports to the US and Japan picked up last month, which bodes well for the economy, ANZ economist Raymond Yeung (楊宇霆) said.
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