Industrial production this month is likely to be flat or decline from last month, after the nation posted a second consecutive month of annual decline in output last month, the Ministry of Economic Affairs said yesterday.
Industrial production dropped 1.35 percent year-on-year last month, following an annual decline of 3.17 percent in May, the ministry said in a report.
“Industrial production momentum appears to be remaining soft because of high inventory levels in the semiconductor and flat-panel industries, so we do not rule out seeing another annual decline this month,” Department of Statistics Deputy Director-General Yang Kuei-hsien (楊貴顯) said.
Citing the ministry’s monthly survey of local manufacturers, Yang said the inventory-to-sales ratio for the manufacturing sector is about 70 percent, higher than a healthy level of between 60 percent and 65 percent.
In addition, local manufacturers also face uncertainties over orders in Europe and slower economic growth in emerging markets, Yang said.
“The pace of inventory digestion in the manufacturing sector will also play a key role in whether the nation’s industrial production turns from an annual decline to an increase this quarter,” Yang added.
The report indicated improvements in the production of semiconductor testing devices and optical components, but output of the electronic components industry — integrated circuit substrates, flat panels, LED chips, computer electronics goods and optical components — were still on the decline last month.
Separately, domestic commercial sales dropped for a fourth straight month last month, down 3 percent to NT$1.197 trillion (US$38.06 billion) from a year earlier, affected by declining revenue in the wholesale sector, the ministry said in a separate report.
This saw commercial sales last quarter plunge by 3.1 percent annually to NT$3.533 trillion, the ministry said.
The wholesale sector, which accounted for 69.09 percent of all commercial sales, saw revenue drop 4.5 percent annually to NT$826.9 billion last month, mainly due to declining purchases from Japan and weak demand for building materials, Yang said.
Sales in the retail sector grew 0.4 percent to NT$334.3 billion last month from a year earlier, driven by an increasing number of chain operators and Dragon Boat Festival sales promotions.
Revenues in the food and beverage sector increased 0.9 percent annually to NT$35.6 billion last month, the ministry said.
Yang said the outlook for the food and beverage, and retail sectors remains positive this month, but the wholesale sector faces lower purchases from Japan.
EXTRATERRITORIAL REACH: China extended its legal jurisdiction to ban some dual-use goods of Chinese origin from being sold to the US, even by third countries Beijing has set out to extend its domestic laws across international borders with a ban on selling some goods to the US that applies to companies both inside and outside China. The new export control rules are China’s first attempt to replicate the extraterritorial reach of US and European sanctions by covering Chinese products or goods with Chinese parts in them. In an announcement this week, China declared it is banning the sale of dual-use items to the US military and also the export to the US of materials such as gallium and germanium. Companies and people overseas would be subject to
DOLLAR CHALLENGE: BRICS countries’ growing share of global GDP threatens the US dollar’s dominance, which some member states seek to displace for world trade US president-elect Donald Trump on Saturday threatened 100 percent tariffs against a bloc of nine nations if they act to undermine the US dollar. His threat was directed at countries in the so-called BRICS alliance, which consists of Brazil, Russia, India, China, South Africa, Egypt, Ethiopia, Iran and the United Arab Emirates. Turkey, Azerbaijan and Malaysia have applied to become members and several other countries have expressed interest in joining. While the US dollar is by far the most-used currency in global business and has survived past challenges to its preeminence, members of the alliance and other developing nations say they are fed
TECH COMPETITION: The US restricted sales of two dozen types of manufacturing equipment and three software tools, and blacklisted 140 more Chinese entities US President Joe Biden’s administration unveiled new restrictions on China’s access to vital components for chips and artificial intelligence (AI), escalating a campaign to contain Beijing’s technological ambitions. The US Department of Commerce slapped additional curbs on the sale of high-bandwidth memory (HBM) and chipmaking gear, including that produced by US firms at foreign facilities. It also blacklisted 140 more Chinese entities that it accused of acting on Beijing’s behalf, although it did not name them in an initial statement. Full details on the new sanctions and Entity List additions were to be published later yesterday, a US official said. The US “will
TENSE TIMES: Formosa Plastics sees uncertainty surrounding the incoming Trump administration in the US, geopolitical tensions and China’s faltering economy Formosa Plastics Group (台塑集團), Taiwan’s largest industrial conglomerate, yesterday posted overall revenue of NT$118.61 billion (US$3.66 billion) for last month, marking a 7.2 percent rise from October, but a 2.5 percent fall from one year earlier. The group has mixed views about its business outlook for the current quarter and beyond, as uncertainty builds over the US power transition and geopolitical tensions. Formosa Plastics Corp (台灣塑膠), a vertically integrated supplier of plastic resins and petrochemicals, reported a monthly uptick of 15.3 percent in its revenue to NT$18.15 billion, as Typhoon Kong-rey postponed partial shipments slated for October and last month, it said. The
RSS