Exports declined 11.8 percent year-on-year to US$17.78 billion last month, shrinking for 13 consecutive months, as demand for all product categories remained weak from trading partners around the world, the Ministry of Finance said yesterday.
The contraction is poised to outlive the record during the global financial crisis that sank exports in negative territory for 14 straight months, but this time due to the shifting focus from hardware to software competition, of which local exporters failed to take advantage.
“The world’s growth momentum remained feeble thus far, weighing on exports last month,” Department of Statistics Director-General Yeh Maan-tzwu (葉滿足) told a news conference.
The Lunar New Year and 228 Peace Memorial Day holidays significantly cut working days, making the situation worse, Yeh said.
For the same reason, imports fell 13.1 percent from a year earlier to US$13.63 billion last month, rendering a trade surplus of US$4.16 billion, the statistics official said.
The surplus represents a 7.4 percent drop from a year earlier, with Taiwan benefiting less from international trade.
The worrying trend is evidenced by the consistent decline in electronic component shipments, which accounted for 32.1 percent of total exports, the ministry’s report showed.
Taiwan is home to the world’s largest contract chipmakers, chip designers and producers of camera lenses, smartphones, laptops and related components. The saturating market for smartphones and personal computers bodes ill for local manufacturers, as they depend heavily on orders from international technology giants, such as Apple Inc.
Optical exports plunged 34.3 percent year-on-year last month, while information and communications technology devices fell 10.3 percent, the report said.
Growing competition from rivals in China and elsewhere suggests a long-standing need to diversify export destinations and products, but little has changed over the years, experts and academics said.
Exports declined between 4.7 percent and 13.8 percent to different trading partners last month, as they also struggled to mitigate the pain of the international slowdown, the report said.
Shipments to China dropped 13 percent and down by 13.8 percent to the US last month, signs that the world’s two largest economies are cutting dependence on imports, the report said.
Exports might remain in negative territory this month and beyond due to a lack of exciting technology innovations, Yeh said.
Volatile international crude prices would continue to drag, although the room for price distortions might ease this year given their ultra-low price levels, she said.
That explained why the decline in plastic and chemical products exports tempered to a single-digit percentage last month from a year earlier, Yeh said.
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