Exports slumped 16.9 percent last month from a year earlier, dropping by the fastest pace since August 2009 and widening from 11 percent in October, as a global slowdown pushes the economy closer to a recession, the Ministry of Finance said yesterday.
The grim results came after major technology firms wrapped up inventory building for Christmas sales and oil price disruptions intensified due to a supply glut, the ministry said.
“The landscape remains rugged going forward, as China’s slowdown may constrain demand [for electronics devices] ahead of the Lunar New Year and oil exporters refuse to lower supply,” Department of Statistics Director-General Yeh Maan-tzwu (葉滿足) told reporters.
Photo: CNA
Exports dwindled to US$22.13 billion last month, with the year-on-year decline outpacing that for imports at 13.7 percent to US$19.38 billion, the ministry’s monthly report showed.
That resulted in a trade surplus of US$2.75 billion, representing a fall of 34.2 percent from the same month last year, it said.
The latest trade data bode ill for the nation’s export-driven economy, with GDP likely to decline further after contracting 0.63 percent last quarter.
All product categories logged a double-digit retreat, led by mineral products, which fell 40.1 percent from a year earlier, followed by optical products’ 35.1 percent decline and basic metal products’ 21.8 percent drop, it said.
Electronics shipments, which accounted for 35.1 percent of overall exports, saw an 11.5 percent decrease, as demand for mobile and other devices stalled, Yeh said.
Shipments to China, the nation’s largest export destination with a 39.3 percent share, dropped 19.6 percent to US$8.6 billion, while those to six Southeast Asian countries declined 19.3 percent to US$3.93 billion, the report showed.
US-bound shipments decreased 10.9 percent to US$2.69 billion and weakened 6.1 percent to US$2.01 billion for destinations in Europe, the report said.
The tumble in external demand is unlikely to ease, if companies expect oil prices to drop further, making inventory replenishment expensive now or in the near future, Yeh said.
“Unfortunately, that appears to be the case as evidenced by the reviving volatility in crude oil prices these days,” Yeh said.
The disappointing trade data suggest that Taiwan’s economy has yet to hit the bottom given the pace of downturn similar to that last quarter, Australia and New Zealand Banking Group (ANZ) said.
“If exports contracts more, the growth outlook for this quarter will be severely challenged,” ANZ Hong Kong-based economist Raymond Yeung (楊宇霆) said in a note.
However, the central bank may have priced in the poor results and opt to hold interest rates unchanged at 1.75 percent in its quarterly board meeting next week, the economist said.
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