Taiwan's trade surplus hits record high of US$27bn

The nation's trade surplus hit an all time high at US$27.38 billion last year, while exports and imports also hit record highs last month, growing 19.8 percent and 27.5 percent respectively to US$23.48 billion and US$21.26 billion.

"Demand for petrochemical products, steel and opto-electronic equipment was especially strong," said Lee Li-Shue (李麗雪), chief statistician at the finance ministry, at a media briefing yesterday.

Exports to the six ASEAN nations surged 42.4 percent to US$10.71 billion last month, the ministry's statics showed.

growth

Exports to major markets such as China and Hong Kong, the US and South Korea all saw double-digit growth.

"Robust economic growth in emerging countries is driving their hunger for consumer products and materials for infrastructure construction," said Hsu Kuo-an (徐國安), an analyst with Capital Securities Co Ltd.

Taiwan's exports to the Middle East, Africa and India grew by 76.8 percent, 105.6 percent and 197.5 percent respectively year-on-year during the same period.

imports

Meanwhile, imports hit a new high last month on rising oil and raw material prices.

On average, the nation paid US$85.98 per barrel of oil imported last month, up 55 percent from US$55.45 one year earlier.

As of last month, Taiwan has enjoyed a trade surplus for 22-straight months. But the US$2.22 billion surplus is down 24.2 percent year-on-year.

Despite the jubilant mood among officials, analysts are not as optimistic about economic prospects this year.

"The US economic slowdown will inevitably have an impact on ... emerging markets which have enjoyed spectacular performances in recent years. Even if we see growth in 2008 exports, the percentage is almost certainly going to be in single digits," Hsu said.

not immune

Chang Yu-hui (張佑暉), an analyst at President Securities, said that Taiwan's two major competitors -- Singapore and South Korea -- had already experienced an economic slump as a result of the slowdown in the US. Chang said Taiwan was likely to suffer a similar fate, despite the US market's declining influence on Taiwanese exports.

"Although we have seen an increase of demand from emerging countries, they cannot offset the role of the US as a major global consumer. Let's not forget that those emerging nations feed off [the US market], too," Chang said. "So far, Chinese and Indian economies have remained robust. Whether China can continue to create demand for our exports remains to be seen."

China and Hong Kong together account for more than 40 percent of Taiwan's exports, while the US market's contribution is less than 15 percent, statistics show.

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