Wed, Aug 01, 2018 page12

• Exports, private consumption bump up economy

  ACCELERATION: Positive wealth helped expand retail sales by 4.58 percent and dining revenues by 5.42 percent, the Directorate-General of Budget, Accounting and Statistics said

  • By Crystal Hsu / Staff reporter
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  The nation’s economy last quarter accelerated 3.29 percent from a year earlier, as exports and private consumption turned out stronger than expected, the Directorate-General of Budget, Accounting and Statistics (DGBAS) said yesterday.

  The results beat the government’s May estimate of 3.08 percent and allowed the agency to raise its growth projection for this year from 2.6 to 2.65 percent, DGBAS senior executive officer Huang Wei-jie (黃偉傑) said.

  However, DGBAS has to weigh in other factors when revising its GDP projection on Aug. 17, he said.

  External demand contributed 46.2 percent to growth during the April-to-June period, while domestic demand accounted for 53.8 percent, DGBAS data showed.

  Exports rose 11.22 percent in the first six months of the year, as a continued global economic pickup fostered demand for new technology applications and drove firms to adopt automation, Huang said.

  Shipments of base metal, plastic, chemical and mineral products increased by double digit percentages, supported by increases in oil and material prices, DGBAS said.

  On the domestic front, a stable job market helped boost average wages by 3.2 percent and local shares by 8.27 percent with daily turnover swelling 56.61 percent year-on-year, the agency said.

  The effects of positive wealth helped expand retail sales by 4.58 percent and dining revenues by 5.42 percent, it said, adding that the number of outbound visits increased 8.91 percent.

  However, capital formation last quarter came in weaker than expected, contracting 2.35 percent year-on-year, compared with the previous estimate of a 0.89 percent increase, DGBAS said.

  Conservative capital spending by local semiconductor firms softened the effects of increased investment in transportation equipment and construction works, it said.

  Overall, the first half of the year saw a stable expansion in the domestic economy and Australia and New Zealand Banking Group (ANZ) said the stronger-than-expected showing for last quarter has prompted it to revise its growth forecast from 1.7 to 2.3 percent for this year.

  However, the strong exports might partly stem from front-loading activities by companies in response to uncertainty over US tariffs on Chinese goods, ANZ said.

  Export orders contracted last month, suggesting a potential downturn in the global electronics supply chain, it said.

  Domestic demand also faced downside risks, with private consumption increasing only 2.65 percent in the second quarter, down from 2.73 percent in the first quarter, ANZ said.

  In the absence of concrete policy changes to stimulate domestic demand, the slowdown is likely to continue in the second half of the year, it said.
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