The nation’s current-account surplus slowed by 17 percent year-on-year to US$17.02 billion in the final quarter of last year, as exports weakened amid a US-China trade dispute, the central bank said yesterday.
The figure carries heavy importance for Taiwan’s balance of payments — which includes the current, service and financial accounts — data that summarizes its transactions with the rest of the world regarding movements of goods and services, and the income of residents and foreigners.
The COVID-19 outbreak is raising uncertainty about exports that were previously expected to improve this year after trade tensions between the US and China eased.
The central bank declined to speculate on how data, especially the service account, would evolve this quarter and beyond, after travel deficits rose to a record US$4.2 billion last quarter.
“It is difficult to predict future trends, as the virus outbreak is diminishing tourist arrivals, but also driving local people to cancel trips abroad,” the central bank said.
Governments around the world have introduced border controls and travel restrictions to contain the outbreak. Major local travel agencies have suspended all tours bound for China, Hong Kong and Macau through April, and have reported a sharp decline in trips to Japan, South Korea and other destinations.
Travel deficits for last year stood at US$6.1 billion, also a new high, data showed.
Escalating travel deficits had much to do with keen interest among Taiwanese to travel abroad, coupled with Beijing’s ban on free independent tourist visits to Taiwan, from Aug. 1 last year, the bank said.
From September last year, Japanese tourists outnumbered Chinese, although Chinese visitors generated the most travel income for Taiwan last year, the bank said.
The financial account also saw continued capital outflows for the 38th consecutive quarter, but at a softer pace, as foreign portfolio managers increased holdings in local shares, data showed.
Capital outflows are common in economies such as Singapore, South Korea, Germany and Russia, where trade surpluses have prompted financial institutions to channel excess liquidity to investment tools in overseas markets to pursue higher yields, the bank said.
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