Taiwan’s manufacturing sector showed signs of slowing down as the unresolved debt crisis in Europe curbed consumption of Taiwanese-made electronics, a local think tank said yesterday.
The Taiwan Institute of Economic Research (TIER, 台經院) made the remarks when releasing the nation’s first manufacturing indicators yesterday.
“The European sovereign debt crisis, which broke out in May, has impacted on global market demand,” Gordon Sun (孫明德), deputy director of the macroeconomic forecasting center at TIER, told reporters on the sideline of a press conference.Consumers became more cautious about spending because of a high jobless rate and a weak euro versus the US greenback, Sun said.
In addition, property sales dropped in the US and the Chinese economy was slowing down in the second quarter. All these factors led to a decline in manufacturing growth in June, as Europe, the US and China are all major export markets for Taiwan, Sun said.
The manufacturing index reflects the economic climate in the manufacturing sector two months earlier, compared with a one-month difference in the Council for Economic and Planning Development’s indicator.
The composite headline index fell to 16.35 points in June, down from 17.28 recorded in May, signaling “green” after it flashed “yellow-red” for seven consecutive months. Almost 60 percent of the sub-indexes turned “green,” compared with 30.81 percent recorded in May.
“Although the light turned green, it was only the first month. We have to look at a few more months — at least three months — before we can confirm that the manufacturing sector is indeed slowing down,” Sun said.
TIER said the new manufacturing index would provide more insight into the local manufacturing sector as the council only provides an index on macroeconomic factors.
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