Export orders shrank 0.72 percent last month, marking the first annual decline in about two years as economic weakness in China and the eurozone curtailed demand for electronics from smartphones to LCD televisions, the Ministry of Economic Affairs (MOEA) said yesterday.
Export orders fell to US$36.31 billion last month, compared with US$36.57 billion in December 2010, bringing the fourth quarter’s export orders to US$110.16 billion, with the annual growth rate slowing to 2.04 percent from 6.28 percent in the third quarter, according to ministry statistics.
That bodes ill for the current quarter, with a survey conducted by the ministry indicating that sluggish demand for locally made products and components was expected to extend into the current quarter.
“January export orders are likely to drop from December’s figure with three major export items tumbling, based on the survey,” the deputy director of the ministry’s statistics department, Beatrice Tsai (蔡美娜), told a media briefing.
“More negative news about eurozone debt problems, such as rating cuts, will undercut the positive impact from the introduction of new products like ultrabooks and smartphones, which will increase our export orders,” she added.
However, Tsai said the survey “to some extent, matches the belief that the first quarter should be the bottom, as industrial experts and economic forecasters have recently suggested.”
Export orders from China, Taiwan’s biggest export destination, decreased 6.17 percent to US$9.26 billion last month from US$9.88 billion a year ago, the first fall since July 2009, the ministry said.
“This reflects the fact that slowing economic growth in China has started taking away the momentum of Taiwan’s exports,” Tsai said.
Export orders from eurozone members slid for the fourth consecutive month to US$5.14 billion last month, showing that battered consumer confidence has not yet picked up because of unresolved sovereign debt problems, Tsai said.
A bright spot was the US market, Taiwan’s second-biggest export destination. Exports orders from the US expanded 15.25 percent year-on-year to US$9.08 billion last month, hitting an all-time high, as resilient LCD television sales spurred demand for Taiwanese LCD panels and other related components, the ministry said.
For the whole of last year, export orders were a record US$436.13 billion, up 7.23 percent from US$407.72 billion in 2010, with the strongest growth in information and communication products and electronics in China and the US, the ministry said.
With export orders of US$44.47 billion, ASEAN surpassed Japan and became the fourth-biggest export destination for Taiwan last year, signaling the rising strength of emerging nations. Japan placed US$42.77 billion of orders with local firms last year.
Taiwan’s diminishing strength in export orders also reflected the nation’s falling industrial output. Last year, industrial output grew 4.62 percent annually to 132.15, a slower rate than the 5 percent forecast by the ministry.
“The sharp decline in manufacturing output in November and December is the major factor,” statistics department director-general Huang Ji-shih (黃吉實) told a media briefing yesterday.
Manufacturing output, which accounts for 90 percent of overall industrial output, contracted 4.65 percent annually in November and dropped at an annualized rate of 8.15 percent last month, the ministry’s statistics showed.