Local enterprises’ outlook toward the domestic manufacturing sector improved slightly last month, according to a monthly report released yesterday by the Taiwan Institute of Economic Research (TIER, 台經院).
The TIER, one of the nation’s leading think tanks, said that although electronics exports remained overshadowed by weakening global demand, outbound sales in machinery, textiles, optoelectronics and auto parts stabilized during the month, which helped to boost optimism.
Based on the institute’s monthly survey of business sentiment, its manufacturing composite index rose 0.13 points from April to 96.42 last month, breaking a three-month losing streak.
Optimism toward the local service sector also improved slightly, with the service composite index up 0.22 points month-on-month to 97.02 last month, as retail and wholesale operators appeared upbeat, the think tank said.
TIER president Lin Chien-fu (林建甫) said that while the global economy remains on the road to recovery, it has been a slower comeback than the market had previously expected.
However, the US economy — the largest in the world — has been shedding the weakness of the first quarter, when bitter weather and strikes by port workers affected consumption and retail sales, Lin said.
He added that other economies, such as China and the eurozone, improved as they eased their monetary policies.
As a result, while the pace of the global economic recovery remained slow, it appeared stable, Lin said.
Despite a slight recovery in manufacturing sentiment, the mood toward the local construction sector worsened, with the composite index of the construction sector down 3.4 points from April at 77.74 last month, the TIER report shows.
Lin said that a weaker outlook toward the property market largely reflected a decline in transactions of homes, shops and offices, while the number of public works has also been on the decline, dampening optimism.
ELECTRONICS Lite-On delays sale of unit Lite-On Technology Corp (光寶科技) yesterday said it would postpone the sale of its solid-state drives (SSD) business to Kioxia Holdings Corp, formerly known as Toshiba Memory Holdings Corp, due to disruptions amid the COVID-19 pandemic. Last year, the Taiwan-based electronics components supplier struck the deal with the Japanese firm, agreeing to sell the unit for US$165 million. Citing unfinished integration work due to the pandemic, Lite-On has deferred today’s closing date until further notice, adding that the delay would not have a negative effect on the unit’s operations. AUTO PARTS Hiroca approves dividend Automotive interior parts supplier Hiroca
NOT ALL GOOD: Analysts warned that other data for last month might be less rosy due to the virus and analysts expect the PMI to contract again next month Chinese factory activity saw surprise growth last month as businesses went back to work following a lengthy shutdown, but analysts said that the economy faces a challenging recovery as external demand has been devastated by the COVID-19 pandemic, while the World Bank said that growth could screech to a halt. China is slowly returning to life after months of tough restrictions aimed at containing the virus, which put millions of people into virtual house arrest and brought economic activity to a near standstill. The strict measures saw a closely watched gauge of manufacturing plunge to its lowest level on record in February,
ALL ABOUT STRATEGY: The company is optimistic, saying that its gross margin should increase year-on-year, but it is scaling back on its plans to expand capacity Quang Viet Enterprise Co (QVE, 廣越), which makes down jackets and garments for sportswear and outdoor brands including Adidas AG, yesterday said that revenue might drop 5 to 10 percent annually this year as some customers trimmed orders in response to the COVID-19 pandemic. That would mark its first revenue decline since 2016. Quang Viet posted record-high revenue of NT$16.26 billion (US$537.45 million) last year, up 22 percent from 2018. Down jackets made up 40 percent of it revenue last year. North Face Inc and Patagonia Inc are this year likely to reduce orders by 20 to 30 percent from a
Taipei 101, one of the nation’s leading shopping centers, is planning to reduce its business hours due to decreased demand amid the COVID-19 pandemic. Taipei 101 is to open daily at noon and close at 9pm from April 6, building management said in a statement on Monday. The shopping center has been opening at 11am and closing at 9:30pm from Sunday to Thursday, while closing at 10pm on Friday and Saturday. The restaurants in the food court — on the basement level — would adjust their business hours as necessary, but the supermarket would continue to open at 9am daily, management said. The shopping