The Taiwan Institute of Economic Research (TIER, 台灣經濟研究院) yesterday trimmed its forecast for Taiwan’s GDP growth this year from 3.81 percent to 3.45 percent and expected the pace to slow further to 2.91 percent next year, as global economic headwinds gain force.
Exports and private investment would weaken, leaving domestic demand to drive growth single-handedly, the Taipei-based think tank said.
The war in Ukraine and China’s draconian COVID-19 restrictions derailed global economic recovery this year, and fears of recession next year are developing amid drastic monetary tightening by major central banks aiming to tame inflation, TIER said.
Photo: CNA
“It would take great effort by supply chains to digest excessive inventory, so local firms had better brace for tough times that may prove longer than expected,” TIER president Chang Chien-yi (張建一) told a news conference.
The world could see low growth or recessions in the next two to four years, boding ill for Taiwan’s exports, Chang said.
High inflation in the US means that the world’s largest consumer of electronic gadgets would cut budgets for luxury items, notebook computers and smartphones, which would be unfavorable for local suppliers including mature chipmakers, he said.
FocalTech Systems Co (敦泰電子), a local supplier of touch screen integrated circuits used in flat panels, yesterday said it would shrink its payroll by 10 to 13 percent after incurring NT$2.5 billion (US$78.36 million) in inventory losses last quarter, equal to losses of NT$13.57 per share.
Flat-panel exports last month plunged 42 percent from a year earlier due to inventory adjustments and sluggish demand, government data showed.
US technology giants Tesla Inc, Twitter Inc and Facebook owner Meta Platforms Inc have announced massive layoffs to cope with poor business.
TIER expects exports to expand a modest 2.35 percent next year, from an estimated 9.86 percent increase this year, its report said.
Imports would slump from a 13.21 percent expansion this year to a mild 1.79 percent uptick, as international energy and raw material prices could fall amid tepid demand.
Private investment, a main driver of growth in recent years, would retreat from a 5.87 percent gain this year to a 2.83 percent rise next year, TIER said.
Major technology firms including Taiwan Semiconductor Manufacturing Co (台積電), the world’s top chipmaker, have cut or postponed capital expenditures due to order cancelations and concerns that inventory adjustments would persist through the first half of next year.
TIER Macroeconomic Forecasting Center director Gordon Sun (孫明德) said the US consumer prices last month grew 7.7 percent, still very high despite being milder than expected.
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) last week recorded an increase in the number of shareholders to the highest in almost eight months, despite its share price falling 3.38 percent from the previous week, Taiwan Stock Exchange data released on Saturday showed. As of Friday, TSMC had 1.88 million shareholders, the most since the week of April 25 and an increase of 31,870 from the previous week, the data showed. The number of shareholders jumped despite a drop of NT$50 (US$1.59), or 3.38 percent, in TSMC’s share price from a week earlier to NT$1,430, as investors took profits from their earlier gains
In a high-security Shenzhen laboratory, Chinese scientists have built what Washington has spent years trying to prevent: a prototype of a machine capable of producing the cutting-edge semiconductor chips that power artificial intelligence (AI), smartphones and weapons central to Western military dominance, Reuters has learned. Completed early this year and undergoing testing, the prototype fills nearly an entire factory floor. It was built by a team of former engineers from Dutch semiconductor giant ASML who reverse-engineered the company’s extreme ultraviolet lithography (EUV) machines, according to two people with knowledge of the project. EUV machines sit at the heart of a technological Cold
Taiwan’s long-term economic competitiveness will hinge not only on national champions like Taiwan Semiconductor Manufacturing Co. (TSMC, 台積電) but also on the widespread adoption of artificial intelligence (AI) and other emerging technologies, a US-based scholar has said. At a lecture in Taipei on Tuesday, Jeffrey Ding, assistant professor of political science at the George Washington University and author of "Technology and the Rise of Great Powers," argued that historical experience shows that general-purpose technologies (GPTs) — such as electricity, computers and now AI — shape long-term economic advantages through their diffusion across the broader economy. "What really matters is not who pioneers
TAIWAN VALUE CHAIN: Foxtron is to fully own Luxgen following the transaction and it plans to launch a new electric model, the Foxtron Bria, in Taiwan next year Yulon Motor Co (裕隆汽車) yesterday said that its board of directors approved the disposal of its electric vehicle (EV) unit, Luxgen Motor Co (納智捷汽車), to Foxtron Vehicle Technologies Co (鴻華先進) for NT$787.6 million (US$24.98 million). Foxtron, a half-half joint venture between Yulon affiliate Hua-Chuang Automobile Information Technical Center Co (華創車電) and Hon Hai Precision Industry Co (鴻海精密), expects to wrap up the deal in the first quarter of next year. Foxtron would fully own Luxgen following the transaction, including five car distributing companies, outlets and all employees. The deal is subject to the approval of the Fair Trade Commission, Foxtron said. “Foxtron will be
RSS