Exports fell by a deeper 11.7 percent to US$23.49 billion last month, following an 8.9 percent decline in March, as a lackluster global recovery weakened demand for electronic devices, while cheaper oil prices continued to depress non-technological shipments, the Ministry of Finance said yesterday.
The slump in exports, the deepest in more than five years, indicated a slowdown in growth momentum, leading Australia and New Zealand Banking Group (ANZ) to cut its economic growth forecast for Taiwan from 4.2 percent to 3.79 percent for this year.
“Stripping out holiday disruptions, exports declined for two months in a row, raising concern about deteriorating trade conditions,” Department of Statistics Director Yeh Maan-tzwu (葉滿足) said.
Exports are critical to the nation’s economy, accounting for 77.75 percent of GDP growth in the first quarter, the Directorate-General of Budget, Accounting and Statistics (DGBAS) said last week.
While cheaper oil prices are to blame, a soft global economy and growing competition from trade rivals, especially China, also proved to be a drag, Yeh said.
As in March, the contraction in outbound shipments cut across all product categories — with electronics exports down 3.2 percent and mineral exports falling 48.6 percent, according to the ministry’s report.
The much-anticipated demand for inventory restocking has yet to emerge although international oil prices have shown signs of a recovery, it said.
The DGBAS is bound to cut its export forecast for this year when it updates the growth projection later this month, Yeh said.
Shipments to China decreased 12.2 percent last month from a year earlier, while those to ASEAN and Europe fell 18.9 and 21.6 percent respectively, the report said.
Exports to the US eked out a small 1.2 percent gain, while those to Japan grew 9.3 percent due to a low base, the ministry said.
Meanwhile, imports fell 22.1 percent to US$18.7 billion last month, resulting in a bigger trade surplus of US$47.6 billion, the report said.
For the first four months of the year, exports dropped 6.2 percent to US$93.74 billion, while imports shrank 16.8 percent to US$75.56 billion, lifting the cumulative trade surplus to a record-high US$18.18 billion, the report said.
Exports are unlikely to return to positive territory this month given weak demand for energy-related products and growing competition for DRAM and optical device suppliers, Yeh said.
ANZ expressed disappointment with the latest export data, saying that Taiwan’s growth momentum has started to lose steam, though it outperformed South Korea, Hong Kong and Singapore in GDP growth last quarter.
“We revise down our growth forecast for Taiwan to 3.79 percent for this year, from the previous estimate of 4.2 percent,” as downside risks intensify, ANZ Hong Kong-based economist Raymond Yeung (楊宇霆) said, referring to the slowdown in global technology manufacturing and its unfavorable impact on Taiwan.
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