The nation’s balance of payments (BOP) for the third quarter registered a current account surplus of US$12.48 billion, an increase of 14.5 percent, or US$1.58 million, from a year earlier, as exports softened amid the US-China trade dispute and imports declined at a faster pace, the central bank said on Wednesday.
The latest BOP report summarized Taiwan’s transactions with the rest of the world with regard to movements of goods, services and income by residents and foreigners during the July-to-September period.
Exports were fairly resilient, dipping slightly by 0.8 percent year-on-year to US$85.03 billion, as local firms shifted part of their production in China to Taiwan to circumvent punitive US tariffs on Chinese goods.
However, global uncertainties took a toll on demand for oil and raw materials, driving down overall imports by 3.2 percent to US$72.2 billion.
As a result, the goods trade surplus increased by US$0.45 billion to US$16.16 billion — with exports dropping by US$3.44 billion and imports falling by US$3.9 billion, the central bank said.
The current account surplus might widen going forward, helped by the high season for information technology products, for which Taiwanese firms supply critical components such as chips, camera lenses, battery packs and casings.
The financial account, which captures fund movements by financial institutions, saw a net capital outflow of US$40.52 billion for the 37th consecutive quarter, the report showed.
Capital outflows are common in economies such as Singapore, South Korea, Germany and Russia, where trade surpluses have prompted financial institutions to channel excess liquidity to investment tools in overseas markets to pursue higher yields, the central bank said.
Capital outflows totaled US$453.29 billion for the past 37 quarters, translating into seven times the government’s revenue for this year.
Local mutual funds and insurance companies raised holdings in foreign securities by US$21.9 billion, the bank said.
Foreign portfolio managers slashed positions in local shares by US$3.71 billion as the trade dispute gained heat.
The trend has reversed following the trade de-escalation last month, when the US and China agreed to put tariff hikes on hold and resumed trade talks.
The travel deficit widened to a record US$2.3 billion, with travel spending by Taiwanese going abroad climbing to a new high of US$5.71 billion, outpacing travel income of US$3.42 billion from inbound travelers, the report said.
Arrivals rose 6.5 percent in the third quarter from a year earlier, with the growth mainly driven by tourists from Japan, South Korea, the Philippines and Thailand, government data showed.
However, the number of Chinese tourists slumped by 40 percent in September and might tumble further after Beijing banned individual travelers from 47 Chinese cities from visiting Taiwan beginning on Aug. 1.
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