Export orders flat last month

DOWNTREND::Last month signaled an end to 21 months of expansion as orders for technology-related products declined, but first-half orders still hit a record high

By Kuo Chia-erh  /  Staff reporter

Sat, Jul 21, 2018 - Page 12

Export orders edged down 0.1 percent year-on-year to US$40.31 billion last month, mainly due to slower sales of information technology and communications (ICT) products, the Ministry of Economic Affairs said yesterday.

Last month’s figure ended 21 consecutive months of annual expansion and missed the ministry’s target.

Export orders for the first half of the year still reached a record-high US$238.44 billion, up 6.6 percent from the same period last year.

“Last month’s decline was mainly due to a drop in orders for technology-related products,” Department of Statistics Director-General Lin Lee-jen (林麗貞) said at a news conference.

ICT orders dropped 7.6 percent annually because of a higher comparison base last year, Lin said.

Electronics orders also shrank 0.2 percent year-on-year, dragged down by weak sales of smartphones and cryptocurrency mining equipment, she added.

Bucking the downward trend, orders for traditional sectors remained strong, with machinery goods increasing 2.2 percent and petrochemical products growing 3.6 percent, while basic metals rose 10.6 percent, the ministry said.

By destination, orders from the US and Europe fell 4.3 percent and 0.5 percent respectively on an annual basis, while shipments to China and Hong Kong rose 5.8 percent, it said.

Based on its survey of companies in 12 benchmark sectors, the ministry said it was optimistic about the outlook for the second half of this year, despite the risk of growing trade protectionism around the world.

The EU’s 25 percent safeguard tariffs on 23 categories of steel products are expected to have a marginal impact on Taiwanese suppliers, thanks to their diversified customer bases, Lin said.

In addition, hot-rolled stainless steel products — a major component of Taiwanese steel exports — were not included on the tariff target list, she said.

Australia & New Zealand Banking Group economist Kaushik Baidya has a more cautious outlook, saying in a report that the slowdown in export orders is likely to persist in the coming months, posing a drag on Taiwan’s second-half GDP growth.

“The weakness in June indicates a potential downtrend in the region’s trade as Taiwan’s export orders have been a bellwether of the export performance of other economies,” Baidya wrote.

The ministry expects export orders for this month to grow by between 0.7 percent and 3.3 percent from the same period last year, it said in a statement. That would translate into orders of between US$39 billion and US$40 billion.