The Directorate-General of Budget, Accounting and Statistics (DGBAS) yesterday cut its forecast for Taiwan’s GDP growth this year to 2.19 percent, from a 2.27 percent estimate in February, as exports proved weaker last quarter and private consumption failed to lend support.
Poor economic data warranted the downward revision after the decline in exports turned out to be deeper than expected, DGBAS Minister Chu Tzer-ming (朱澤民) told a news conference.
The nation’s export-reliant economy expanded 1.71 percent year-on-year in the first quarter, slower than the 1.72 percent annual increase the agency reported on April 30.
Exports, equivalent to 60 percent of domestic GDP, are now expected to remain in the negative for the entire year, rather than eking out fractional growth, after Washington on May 10 raised tariffs on an additional US$20 billion of Chinese goods, the agency said in a report.
“The forecast has not factored in pending tariffs valued at US$325 billion or the US’ ban on Huawei Technologies Co (華為),” Chu said.
Taiwan is home to major technology companies with deep participation in the global supply chains for smartphones, laptops and other consumer electronics.
The agency declined to comment on whether the slowdown has hit bottom, saying that the situation last month showed signs of improvement, but uncertainty flared up again this month.
International research institutes have trimmed projections for global GDP and trade growth, leaving a less favorable situation for Taiwan, Chu said.
External demand eroded GDP growth by 0.01 percentage points in the January-to-March period, the report said.
Although private consumption posted a 1.32 percent gain, it missed the February forecast by 0.47 percentage points, he said.
Sales of cars and smartphones disappointed, while daily stock turnover tumbled 23.76 percent from a year earlier, meaning lackluster brokerage fees, the report said.
A US-China trade war is driving investors to the sidelines, as evidenced by the fast flight of foreign funds from the local bourse, it said.
Foreign institutional investors have this month slashed NT$118.23 billion (US$3.75 billion) in local holdings, Taiwan Stock Exchange data showed.
However, there is a silver lining from the trade war, as some Taiwanese firms in China have been moving production back to Taiwan, significantly boosting private investment, Chu said.
The GDP component last quarter rose 6.45 percent, thanks to active purchases of capital equipment by local semiconductor firms, he said.
More than 55 companies have filed plans to relocate manufacturing facilities from China, which would bring home investment totaling more than NT$310 billion, DGBAS official Jasmine Mei (梅家瑗) said, adding that the trend has helped ease the pain of the trade war.
As a result, the agency raised its forecast for capital formation by 0.39 percentage points to an increase of 5.39 percent this year, aided by expenditure by the government and public enterprises.
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