Taiwanese machine tool makers on Sunday expressed concern about the local industry’s competitiveness following South Korea’s signing of a free-trade agreement with China, unprecedented low interest rates in South Korea and the depreciation of the won.
The won fell 2.65 percent against the US dollar over the past week, while the Bank of Korea on Thursday slashed the seven-day repurchase rate to 1.75 percent, cutting it below 2 percent for the first time.
These factors, coupled with the concessions Seoul will gain under its agreement with China, could squeeze the competitiveness of Taiwanese industries, including machine tool manufacturers, Goodway Machine Corp (程泰機械) chairman Edward Yang (楊德華) said at a forum.
Other industries that could be severely affected include petrochemicals, display panels and semiconductors, Yang said, adding that there is considerable overlap between Taiwanese and South Korean exports.
He said the government should avoid overregulation and instead promote policies that would foster growth and development, while the central bank needs to pay greater attention to the plight of the private sector.
Like South Korea, Taiwan must lower its interest rates in response to a falling yen, Yang said.
Taiwan Association of Machinery Industry chairman Hsu Hsiu-tsang (徐秀滄) agreed, saying that Taiwanese companies would begin to feel the effects of a weaker won in the second half of this year.
The central bank has been conservative in its decisions compared with its counterparts in China and South Korea, Hsu said.
Local machine tool makers think that the NT dollar should ideally be kept at a rate of between NT$32.5 and NT$33 against the US dollar, he said.
However, Taiwan Machine Tool and Accessory Builders’ Association secretary-general Carl Huang (黃建中) said that the effects of a weaker won on Taiwan’s industrial sector would be negligible — no more than a “paper cut.”
The real threat is the continued decline of the yen, he said, adding that the effects on the nation’s industries would be more like a “gunshot wound.”
Huang said companies like Goodway could retain a competitive edge over their South Korean rivals, because Taiwanese brands are highly regarded in the international market for lathes.
Other representatives of Taiwanese machine tool companies said that South Korea’s market for lathes is supported by strong domestic demand, with about 30 percent their output purchased by the country’s automobile industry.
Meanwhile, Japan’s lathe exports to Southeast Asian markets are still more expensive than Taiwan’s, but the price difference has now shrunk to less than US$1,000 per unit and domestic prices in both nations are similar, representatives of Taiwan’s machine tool industry said.
Stephen Garrett, a 27-year-old graduate student, always thought he would study in China, but first the country’s restrictive COVID-19 policies made it nearly impossible and now he has other concerns. The cost is one deterrent, but Garrett is more worried about restrictions on academic freedom and the personal risk of being stranded in China. He is not alone. Only about 700 American students are studying at Chinese universities, down from a peak of nearly 25,000 a decade ago, while there are nearly 300,000 Chinese students at US schools. Some young Americans are discouraged from investing their time in China by what they see
Taiwan Transport and Storage Corp (TTS, 台灣通運倉儲) yesterday unveiled its first electric tractor unit — manufactured by Volvo Trucks — in a ceremony in Taipei, and said the unit would soon be used to transport cement produced by Taiwan Cement Corp (TCC, 台灣水泥). Both TTS and TCC belong to TCC International Holdings Ltd (台泥國際集團). With the electric tractor unit, the Taipei-based cement firm would become the first in Taiwan to use electric vehicles to transport construction materials. TTS chairman Koo Kung-yi (辜公怡), Volvo Trucks vice president of sales and marketing Johan Selven, TCC president Roman Cheng (程耀輝) and Taikoo Motors Group
MAJOR DROP: CEO Tim Cook, who is visiting Hanoi, pledged the firm was committed to Vietnam after its smartphone shipments declined 9.6% annually in the first quarter Apple Inc yesterday said it would increase spending on suppliers in Vietnam, a key production hub, as CEO Tim Cook arrived in the country for a two-day visit. The iPhone maker announced the news in a statement on its Web site, but gave no details of how much it would spend or where the money would go. Cook is expected to meet programmers, content creators and students during his visit, online newspaper VnExpress reported. The visit comes as US President Joe Biden’s administration seeks to ramp up Vietnam’s role in the global tech supply chain to reduce the US’ dependence on China. Images on
New apartments in Taiwan’s major cities are getting smaller, while old apartments are increasingly occupied by older people, many of whom live alone, government data showed. The phenomenon has to do with sharpening unaffordable property prices and an aging population, property brokers said. Apartments with one bedroom that are two years old or older have gained a noticeable presence in the nation’s six special municipalities as well as Hsinchu county and city in the past five years, Evertrust Rehouse Co (永慶房產集團) found, citing data from the government’s real-price transaction platform. In Taipei, apartments with one bedroom accounted for 19 percent of deals last