Taiwan’s business climate monitor last month was green for a second consecutive month, suggesting steady growth, but downside risks are gathering strength amid China’s COVID-19 lockdowns and Russia’s invasion of Ukraine, the National Development Council (NDC) said yesterday.
The total score of the nine subindices lost 3 points to 28, with the values on business confidence, local share prices as well as retail, wholesale and restaurant sales subsiding, while the five other gauges held steady, NDC research director Wu Ming-huei (吳明蕙) said.
Exports, a main growth driver, remained strong with double-digit percentage growth last month, thanks to digital transformations and demand for innovative technology applications, Wu said.
Photo: CNA
The council uses a five-color system to capture the nation’s economic state, with “green” indicating steady growth, “red” suggesting a boom and “blue” signaling a recession. Dual colors indicate a shift to a stronger or weaker state.
The war in Ukraine is driving up international energy and commodity prices, which is unfavorable for corporate profitability and consumer spending, Wu said.
Global monetary tightening is rocking financial markets worldwide, while China’s lockdowns of key industrial and commercial cities is negatively affecting supply chains, she said.
Local suppliers of components used in smartphones, laptops and TVs have given conservative guidance for their shipments and selling prices for this quarter, she said.
The index of leading indicators, which is intended to project the economic scene in the following six months, fell 0.33 percent to 100.19, the council said.
Almost all subindices displayed negative cyclical movements, except for the reading on new construction, which posted a gain, it said.
The index of coincident indicators, which reflects the current economic situation, posted a 0.09 percent increase to 102.34 percent on the back of improving exports, non-farm payrolls, and imports of machinery and electrical equipment, it said.
Retail, wholesale and restaurant sales would take a dive this month, as people stay home due to Taiwan’s COVID-19 situation, Wu said.
“That is a worrying development,” she added.
The government has rolled out fresh subsidy and relief funds to help affected companies and individuals.
Meanwhile, the consumer confidence index this month lost 3.96 points to 67.81, dragged down by a volatile local stock market, rising retail prices and economic uncertainty, a survey by National Central University showed.
All six subindices fell, although people remained somewhat positive about purchases of durable goods, mainly real estate, the survey said.
Contract chipmaker United Microelectronics Corp (UMC, 聯電) yesterday said it has signed a memorandum of understanding (MOU) with Polar Semiconductor LLC to collaborate on the production of 8-inch wafers in the US. The collaboration aims to strengthen 8-inch wafer manufacturing in the US amid Washington’s efforts to increase onshore manufacturing of semiconductors, contribute to supply chain resilience against shifting geopolitical dynamics, and ensure a secure domestic supply of power semiconductors critical to automotive, electric grids, robotic manufacturing and data centers, the companies said in a joint statement. Under the MOU, Polar and UMC will identify devices for Polar to manufacture at
TECH TITANS: Amazon’s latest chip joins Google in competing for the 90 percent market share held by Nvidia, which claims it is ‘a generation ahead of the industry’ Amazon Web Services (AWS) on Tuesday launched its in-house-built Trainium3 artificial intelligence (AI) chip, marking a significant push to compete with Nvidia Corp in the lucrative market for AI computing power. The move intensifies competition in the AI chip market, where Nvidia dominates with an estimated 80 to 90 percent market share for products used in training large language models that power the likes of ChatGPT. Google last week caused tremors in the industry when it was reported that Facebook-parent Meta Platforms Inc would employ Google AI chips in data centers, signaling new competition for Nvidia. This followed the release last month of
TARIFF TALKS: The US secretary of commerce is eyeing more than US$300 billion in investments and said Taiwan would train US workers, but Taipei has denied the latter US Secretary of Commerce Howard Lutnick said the US is expecting a large investment pledge from Taiwan in trade talks, while President William Lai (賴清德) listed areas that need improvement in order for projects to be completed. “We’re in the midst of discussions,” Lutnick said on Wednesday. “But the fact is, this administration’s goal is to bring semiconductor manufacturing to America.” Lai on Wednesday said Taiwan is supportive of US President Donald Trump’s goal of reindustrializing the US, including efforts to ramp up semiconductor production. Such a goal would require the US to reduce its reliance on Taiwan as a key source
Foxconn Technology Group (富士康科技集團) and Luxshare Precision Industry Co (立訊精密) plan to add millions of gaming devices to Vietnam’s annual output, according to documents they submitted to local authorities, reinforcing the country’s role in the global supply of game consoles. Vietnam assembles a variety of electronic products destined for foreign markets, including smartphones, computers and tablets. Information on its production of consoles is not public, but Foxconn EV Energy & Component (Vietnam) Co, a subsidiary of the Taiwanese manufacturer, has capacity to produce up to 4 million gaming devices in a factory in Northern Vietnam, according to a company document from
RSS