Taiwan’s economy lost steam again last month after exports shrank 4.4 percent month-on-month to US$35.3 billion, data released on Wednesday by the Ministry of Finance showed. That brought the nation’s exports up just 2.3 percent during the first seven months to US$175.74 billion from a year ago.
Ministry of Finance officials attributed the sluggish annual growth to China’s economic woes caused by overcapacity and a rise in wages. Exports to China, including Hong Kong, only climbed 3.1 percent year-on-year in the period from January to last month following a 0.9 percent annual decline last month.
Exports to the US and Europe also dropped at an annual rate of 1.1 percent and 6.9 percent respectively during the same period as sagging private consumption curtailed demand for smartphones and other communication devices made by Taiwanese firms.
The weakness in the New Taiwan dollar has lent some support to exports. The NT dollar depreciated 3.41 percent against the US dollar to NT$30.120 during the seven-month period.
Taiwan’s anemic export growth is likely to pave the way for the Director-General of Budget, Accounting and Statistics (DGBAS) on Friday to cut its GDP annual growth forecast from the its previous estimate of 2.4 percent annual growth this year.
The agency expected exports to expand nearly 3 percent year-on-year to US$309.7 billion this year.
As exports will still be the biggest driver of GDP, representing the equivalent of about 68 percent of the country’s economic output this year based on the
DGBAS’ projection, the government should help firms to export to new growth areas beyond China.
The ASEAN region could have the potential to prop up Taiwan’s exports and thereby its GDP growth, while economic growth in Taiwan’s major export destinations, including China, the US and Europe, is staggering. This is because the US Federal Reserve is widely expected to start scaling back its bond purchasing program, or quantitative easing policy, next month, which will slow US GDP growth this year.
Taiwan’s exports to six emerging countries, including Malaysia and five other ASEAN members, showed robust growth as reflected by an annual growth of 7.3 percent in exports to US$33.45 billion in the seven-month period ending on July 31.
That makes ASEAN countries Taiwan’s second-biggest export destination, surpassing the US, Europe and Japan.
In fact, ASEAN seized the No. 2 position in 2007, when exports to those countries grew at an annual rate of 16.7 percent, outpacing China’s 12.6 percent expansion based on the statistics compiled by the Ministry of Finance.
However, progress in joining the ASEAN bloc has long been stalled, with no recent updates from the government. Instead, it is taking a different approach by pushing for a new round of negotiations of the Economic Cooperation Framework Agreement with China, to further open up Taiwan’s service sector, even though the early benefits brought by the agreement fell short of expectations.
Although liberalization is a better way to boost trade and economy, some rules must be followed. Those rules include the old saying: “Do not put all your eggs in one basket.” Taiwan’s government should be looking for markets other than China, especially when that country’s growth is waning.
For the Chinese Communist Party (CCP), China’s “century of humiliation” is the gift that keeps on giving. Beijing returns again and again to the theme of Western imperialism, oppression and exploitation to keep stoking the embers of grievance and resentment against the West, and especially the US. However, the People’s Republic of China (PRC) that in 1949 announced it had “stood up” soon made clear what that would mean for Chinese and the world — and it was not an agenda that would engender pride among ordinary Chinese, or peace of mind in the international community. At home, Mao Zedong (毛澤東) launched
The restructuring of supply chains, particularly in the semiconductor industry, was an essential part of discussions last week between Taiwan and a US delegation led by US Undersecretary of State for Economic Growth, Energy and the Environment Keith Krach. It took precedent over the highly anticipated subject of bilateral trade partnerships, and Taiwan Semiconductor Manufacturing Co (TSMC) founder Morris Chang’s (張忠謀) appearance on Friday at a dinner hosted by President Tsai Ing-wen (蔡英文) for Krach was a subtle indicator of this. Chang was in photographs posted by Tsai on Facebook after the dinner, but no details about their discussions were disclosed. With
To say that this year has been eventful for China and the rest of the world would be something of an understatement. First, the US-China trade dispute, already simmering for two years, reached a boiling point as Washington tightened the noose around China’s economy. Second, China unleashed the COVID-19 pandemic on the world, wreaking havoc on an unimaginable scale and turning the People’s Republic of China into a common target of international scorn. Faced with a mounting crisis at home, Chinese President Xi Jinping (習近平) rashly decided to ratchet up military tensions with neighboring countries in a misguided attempt to divert the
Astride an ascended economy and military, with global influence nearing biblical proportions, Xi Jinping (習近平) — general secretary of the Chinese Communist Party (CCP), chairman of the Central Military Commission and president of the People’s Republic of China — is faithfully heralded, in deeds and imagery, as a benevolent lord, determined to “build a community of common destiny for all mankind.” Rather than leading humanity to this Shangri-La through inspirational virtue a la Mahatma Gandhi or Abraham Lincoln, the CCP prefers a micromanagement doctrine of socialism with Chinese characteristics as the guiding light. A doctrine of Marxist orthodoxy transplanted under a canvas