The nation’s exports last month fell 4.8 percent from a year earlier to US$27.72 billion, extending April’s 3.3 percent decline, as escalating US-China trade tensions cooled demand for most products and soured outlooks, the Ministry of Finance said yesterday.
“Firms have misgivings about doing business as uncertainty increases,” Department of Statistics Director-General Beatrice Tsai (蔡美娜) said.
It is the seventh straight month that the critical economic gauge posted a negative cyclical movement without any sign of improvement, Tsai added.
Photo: CNA
The Directorate-General of Budget, Accounting and Statistics last month projected that exports might remain negative for the rest of the year, rather than posting fractional growth as previously forecast.
Non-technology sectors were hardest hit as shipments of base metal products shrank 20 percent, chemical products 19.3 percent and plastic products 14 percent from levels last year, Tsai said.
The retreat is the fastest in three years, exacerbated by falling prices for raw materials and base metals, as firms hesitate over building inventories, she said.
Weak sentiment also caused shipments of machinery products to contract 12.8 percent, optical products 8.8 percent and electrical products 5.5 percent, a ministry report said.
Bucking the downturn were chipsets with a 4.4 percent increase, and information and communications products with a 22.9 percent increase, it said.
“China’s Huawei Technologies Co (華為) reportedly made purchases to manage an imminent supply crunch following Washington’s trade restrictions on the company,” Tsai said.
Imports contracted 5.9 percent last month to US$23.22 billion, allowing Taiwan to achieve a trade surplus of US$4.49 billion, the report said.
Sluggish imports came after purchases of capital equipment fell 7.4 percent to US$3.48 billion, ending five consecutive months of gains, Tsai said.
Volatile economic conditions make local companies cautious, she said.
“Exports to China dropped 6.9 percent to US$11.03 billion, as some Taiwanese companies cut dependence on the market as a manufacturing base and moved production lines back home,” Tsai said.
Shipments to the US increased 8.6 percent to US$393.7 billion, raising its share of total shipments to a record 14.2 percent thanks to the relocation of production facilities, she said.
Uncertainty weakened exports to Europe by 8 percent and ASEAN markets by 11.2 percent, the ministry said.
“Looking ahead, declines in outbound shipments this month might be 2 to 4.5 percent,” Tsai said.
For the first five months of the year, declines in exports averaged 4.2 percent, while imports fared better, dropping only 1.2 percent, the ministry said.
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