Exports contracted by 2.1 percent annually to US$22.89 billion last month, the smallest decline in 17 months, as demand for technology products gained traction while non-technology exports remained weak, the Ministry of Finance said yesterday.
Trade figures might return to positive territory this month, ending 17 consecutive months of declines, as demand spurred by inventory-building looks healthy and sustainable if Brexit and other downside risks prove to be controllable, Department of Statistics Director-General Yeh Maan-tzwu (葉滿足) said.
“The growth momentum for electronic component exports is likely to be sustainable given the sanguine guidance by major technology firms and continued increase in their capital spending,” Yeh said by telephone.
Virtual reality, handheld and Internet of Things gadgets are acting as catalysts in an upward trend that might further improve with the expected launches of Apple Inc’s next-generation iPhone, iPad and other products in September, Yeh said.
Barring price disruptions, outbound shipments have registered a 4.1 percent increase, Yeh said, adding that lower crude oil and raw material costs decreased export prices by 6.2 percent.
Imports shrank 10 percent to US$19.31 billion last month, leading to a trade surplus of US$3.58 billion, an improvement of 85.2 percent from a year earlier, the ministry said.
During the April-to-June period, exports fell 6.2 percent from the same period last year, but still fared better than the 6.82 percent decline forecast by the Directorate-General of Budget, Accounting and Statistics (DGBAS) in May.
The trade data would lend support to the agency’s GDP growth forecast for this year’s fourth quarter if private consumption holds steady, Yeh said.
The economy is expected to grow 0.48 percent in the second quarter, ending three quarters of recession, the DGBAS projected.
Exports of electronic components grew 11.5 percent to US$7.44 billion, while information and communication devices rose 4.3 percent to US$2.5 billion, the report said.
However, exports of mineral and optical products, as well as transportation machinery, declined by about 20 percent, due to weak demand, the report said.
Exports to China fell by 4.5 percent, while exports to ASEAN members dropped by 4.4 percent, both easing from double-digit declines seen in previous months, according to the ministry data.
Exports to the US, Japan and Europe increased by 3.1 percent, 0.8 percent and 0.1 percent respectively, the report said, suggesting the recovery is slow and fragile.
Credit Suisse Group AG said that pickup in technology production might extend into the the second half of the year.
Taiwanese semiconductor companies have increased their purchases of capital equipment to help maintain their leadership.
However, Credit Suisse expects the slowdown in China’s private fixed investment to weigh on Taiwan’s exports and private investment despite stabilizing oil prices.
In the first half of the year, exports totaled US$131.33 billion, down 9.1 percent from a year earlier, while imports declined 10.7 percent year-on-year to US$107.3 billion, with the trade surplus dropping US$270 million from a year earlier to US$24.03 billion during the period, the ministry’s report said.
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