The nation’s manufacturing production value plunged 10.84 percent year-on-year to NT$12.86 trillion (US$384.1 billion) last year, dragged down by sluggish demand for consumer electronics worldwide and the falling price of crude oil, the Ministry of Economic Affairs said yesterday.
The decline was the largest for the manufacturing sector since 2010, the ministry said, adding that it expects the decline to carry into this quarter, the fifth straight quarter of decline, compared with a production value of NT$3.27 trillion in the first quarter of last year.
“Overall weak global demand was the biggest reason behind [the decline]... Excessive supply in the stainless steel industry also pressured the nation’s manufacturing sector,” Department of Statistics Deputy Director-General Yang Kuei-hsien (楊貴顯) said by telephone.
Falling global crude oil prices also caused a contraction in the nation’s petrochemical industry last year, Yang said.
The manufacturing sector gauge measures production value in six major industries — electronic components, petrochemicals, basic metals, computer and optical products, machinery goods and automobiles.
The ministry’s latest statistics showed an extensive annual decline in the production value of all the six major industries, with the production value of petrochemicals and basic metals plummeting by more than 20 percent.
Production value of electronic components, the pillar of the nation’s manufacturing sector, fell 3.57 percent year-on-year mainly because of a significant decline in the flat panel industry, Yang said.
The annual production value of the nation’s panel makers fell 13.53 percent, more than NT$150 billion, the statistics showed.
Yang said production value of the nation’s panel industry swung into the negative in the second quarter of last year and the decline extended into the fourth quarter.
“Increased competition from Chinese panel makers and excessive supply have put great pressure on Taiwan’s panel makers and dragged down average selling prices,” Yang said.
Softer-than-expected demand in the PC industry has also further weakened demand, he said.
The semiconductor industry was the only bright spot, with production value growing 6.17 percent on an annual basis last year.
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