The economy grew slower than expected at 3.08 percent annually last quarter, as growth slowed from 3.14 percent in the first quarter of this year, the Directorate-General of Budget, Accounting and Statistics (DGBAS) told a news conference in Taipei yesterday.
Last quarter’s performance was 0.23 percentage points short of the agency’s estimate of a 3.31 percent expansion.
It was also lower than the 3.15 percent forecast in a Bloomberg survey of economists.
Photo: CNA
The new figures came after the US on Thursday reported that its economy shrank in the first two quarters of this year.
The agency said it is unlikely that the Taiwanese economy would contract for two consecutive quarters, which is commonly described as a recession.
The last time that the local economy shrank was in the second quarter of last year, but it rebounded in the following quarter, said Wu Pei-shuan (吳佩璇), an official in the agency’s national income section.
In the first half of this year, the local economy expanded 3.11 percent, the DGBAS said.
The agency now expects 3.85 percent GDP growth for the whole of this year, down from its May forecast of 3.91 percent.
Falling overseas demands for goods and services were the main causes for the slowdown in the local economy last quarter, as net demand from foreign markets contributed minus-1.55 percentage points to GDP growth, the lowest since the first quarter of 2016, the agency said.
Although exports of goods rose 15.38 percent year-on-year last quarter, net income from triangular trade, which is also counted as exportation, lost steam amid lockdowns in China, resulting in sluggish demand for consumer goods, the DGBAS said.
Overall exports of goods and services only rose 4.31 percent last quarter, lower than the 8.81 percent growth in overall imports of goods and services, the agency said.
“Imports were greater than our estimation, pushed up by increasing domestic demand for semiconductor equipment and COVID-19 prevention products,” Wu said.
Private consumption last quarter expanded 2.96 percent from a year earlier despite increasing COVID-19 case numbers, the agency said, attributing the trend to a low comparison base.
Government expenditure grew 5.86 percent, while capital formation advanced 9.43 percent, beating the DGBAS’ forecast, amid surging investment in construction, machinery and transportation, the agency said.
Additional reporting by Bloomberg
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