Taiwan's export orders and factory production fell last month for a sixth straight month, and they'll probably keep sliding as the aftermath of the Sept. 11 terrorist attacks in the US pushes the nation deeper into recession.
Overseas orders fell 16.7 percent from a year earlier to US$11.4 billion, roughly matching July's decline, the Ministry of Economic Affairs said yesterday.
Factory production fell 8.2 percent as overseas customers slashed orders for computers, mobile phones and other electronics.
The nation's economy, which contracted 2.4 percent in the second quarter from a year earlier, may keep shrinking into next year as US demand fails to rebound following the terrorist attacks.
The government, which last month forecast the economy would rebound in the fourth quarter, said it now can't predict when growth will return as the attacks sap US demand.
"The attacks can't be good for the computer industry," said S. Samuel Liu, chief executive of Silicon Integrated Systems Corp (
An expected US recession means customers in Taiwan's biggest market may keep cutting orders in coming months.
The government will lower its 4.2 percent forecast for growth next year, said Chang Yaw-tzong (張耀聰), director of the statistics department in the economics ministry.
Export orders, which point to shipments two to three months later, were already tumbling before the terrorist attacks as stalling growth in the US, Japan and other key markets dampened local consumer spending and business investment.
The government predicted before the attacks that exports -- which make up about half the nation's economy -- would fall 15 percent this year, compared with last year's 22 percent increase.
Without the usual year-end pick-up in sales of PCs and other electronics, the drop may be even sharper.
"In the next couple of months, we're going to go back to the steeper declines because of the recent developments," said Larry Duke, chief economist at Citibank NA in Taiwan. An economic recovery "hinges on the retaliation and duration of ... the attacks."
Orders for semiconductors, notebook computers and other electronics -- Taiwan's biggest exports -- fell 34.5 percent from a year earlier to US$2.2 billion, after a 36 percent drop in July.
Orders for telecom equipment fell 17.4 percent to about US$1.9 billion, compared with a 14 percent drop a month earlier.
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