The Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) yesterday revised down its forecast for the nation’s GDP growth this year, but said it expected the figure to remain above 2 percent as robust capital spending helps mitigate the pain of slower exports.
The institute now expects the economy to expand by 2.06 percent, down from its previous forecast of 2.15 percent.
“The nation’s economic growth might stay above the 2 percent mark, as it improves each quarter,” following a lackluster 1.7 percent increase in the first half, CIER president Chen Shi-kuan (陳思寬) said.
The second half is usually the high season for consumer electronic devices, which should benefit Taiwanese companies in their global supply chains.
Fixed investment, led by technology firms, is expected to lift GDP growth this year by 1.21 percentage points with a 6.36 percent expansion, the Taipei-based think tank said in its quarterly report.
Imports of capital equipment rose 15.7 percent in the first half, with semiconductor equipment swelling 40.28 percent in US dollar terms, the institute said.
The government and public enterprises should help boost the economy, with investments rising 10.15 percent and 7.5 percent respectively, as exports take a hit from the US-China trade dispute, it said.
Exports, normally the main growth driver, is forecast to swing to growth from this quarter, advancing by 3.13 percent and 6.03 percent in the third and fourth quarters respectively, it said.
The critical GDP component contracted 4.24 percent and 2.56 percent in the first and second quarters due to uncertainty and a seasonal slowdown.
For the full year, exports are expected to edge up 0.7 percent, while imports are forecast to rise 1.79 percent, thanks in part to Taiwanese businesses moving back from China, the institute said.
The government has received more than 80 such applications, bringing more than NT$400 billion (US$12.87 billion) in prospective investments.
More than 60 percent of Taiwanese companies maintain factories or operations in China and 60 percent have taken measures to cope with tariff hikes, CIER said, adding that nearly 19 percent are considering moving back to Taiwan.
The trade dispute topped the list of concerns among local firms, followed by currency volatility, and wild swings in global crude oil and raw material prices, it found.
Local firms have to watch out for Chinese yuan movements as it seeks to replace the US dollar in global trade, Yuanta-Polaris Research Institute (元大寶華綜經院) president Liang Kuo-yuan (梁國源) said.
SECOND-RATE: Models distilled from US products do not perform the same as the original and undo measures that ensure the systems are neutral, the US’ cable said The US Department of State has ordered a global push to bring attention to what it said are widespread efforts by Chinese companies, including artificial intelligence (AI) start-up DeepSeek (深度求索), to steal intellectual property from US AI labs, according to a diplomatic cable. The cable, dated Friday and sent to diplomatic and consular posts around the world, instructs diplomatic staff to speak to their foreign counterparts about “concerns over adversaries’ extraction and distillation of US AI models.” Distillation is the process of training smaller AI models using output from larger, more expensive ones to lower the costs of training a powerful new
Singapore-based ride-hailing and delivery giant Grab Holdings’ planned acquisition of Foodpanda’s Taiwan operations has yet to enter the formal review stage, as regulators await supplementary documents, the Fair Trade Commission (FTC) said yesterday. Acting FTC Chairman Chen Chih-min (陳志民) told the legislature’s Economics Committee that although Grab submitted its application on March 27, the case has not been officially accepted because required materials remain incomplete. Once the filing is finalized, the FTC would launch a formal probe into the deal, focusing on issues such as cross-shareholding and potential restrictions on market competition, Chen told lawmakers. Grab last month announced that it would acquire
Shares of Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) have repeatedly hit new highs, but an equity analyst said the stock’s valuation remains within a reasonable range and any pullback would likely be technical. The contract chipmaker’s historical price-to-earnings (P/E) ratio has ranged between 20 and 30, Cathay Futures Consultant Co (國泰證期) analyst Tsai Ming-han (蔡明翰) told Central News Agency. With market consensus projecting that TSMC would post earnings per share of about NT$100 (US$3.17) this year, supported by strong global demand for artificial intelligence (AI) applications, and the stock currently trading at a P/E ratio of below 25, Tsai said the valuation
The artificial intelligence (AI) boom has triggered a seismic reshuffling of global equity markets, with Taiwan and South Korea muscling past European nations one by one. With its stock market now valued at nearly US$4.3 trillion, Taiwan surpassed the UK, Europe’s biggest market, earlier this month, data compiled by Bloomberg showed. South Korea is about US$140 billion away from doing the same. The tech-heavy Asian markets have shot past Germany and France in the past seven months. The shift is largely down to massive gains in shares of three companies that provide essential hardware for AI: Taiwan Semiconductor Manufacturing Co (TSMC, 台積電),
RSS