The nation’s GDP growth could slow to 2.72 percent next year, from an estimated 3.04 percent pickup this year, as global economic headwinds could hurt demand for Taiwanese exports, the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday.
The projection is slightly more conservative than the Directorate-General of Budget, Accounting and Statistics’ forecast of 2.75 percent growth and could be revised further downward after exports last month fell faster than expected.
External demand could make virtually no contribution next year, when the global economy is expected to grow only 2 percent, with the US and Europe heading toward a recession induced by monetary tightening to curb inflation, CIER president Chang Chuang-chang (張傳章) said.
In addition, the Ukraine war and China’s tight COVID-19 controls would continue to slacken global trade, Chang said.
The backdrop is unfavorable for Taiwan, which depends heavily on exports of electronics used in smartphones, notebook computers, TVs, wearables and vehicles.
Domestic demand would lend support to the economy, with a projected 4.26 percent increase in private consumption, a 2.98 percent pickup in government expenditure and a 2.2 percent rise in private investment, CIER said.
However, that implies a sharp contraction in private investment, which is forecast to grow 7.01 percent this year after rising 17.27 percent last year, the Taipei-based think tank said.
Major manufacturers have cut or postponed capital spending and arranged annual maintenance to cope with business downturns and order cancelations.
Exports this quarter are forecast to contract 6.26 percent and remain in the woods in first half of next year, CIER said.
Some academics have warned that inventory adjustments would persist longer, as the pinch of interest rate hikes in the US would grow more evident next year.
The consumer price index would expand by 1.97 percent next year, falling within the central bank’s 2 percent target, after an estimated 2.94 percent gain this year.
International raw material prices have noticeably declined due to slack demand, the institute said.
The Cabinet on Thursday extended tax cuts on imported commodities and critical raw materials by another three months to March to help tame imported inflation.
Imported inflation has received support from a weak New Taiwan dollar linked to capital outflows this year, government data showed.
The NT dollar is likely to trade at an average of NT$31.09 versus the greenback next year, from NT$29.82 this year, CIER said.
Vincent Wei led fellow Singaporean farmers around an empty Malaysian plot, laying out plans for a greenhouse and rows of leafy vegetables. What he pitched was not just space for crops, but a lifeline for growers struggling to make ends meet in a city-state with high prices and little vacant land. The future agriculture hub is part of a joint special economic zone launched last year by the two neighbors, expected to cost US$123 million and produce 10,000 tonnes of fresh produce annually. It is attracting Singaporean farmers with promises of cheaper land, labor and energy just over the border.
US actor Matthew McConaughey has filed recordings of his image and voice with US patent authorities to protect them from unauthorized usage by artificial intelligence (AI) platforms, a representative said earlier this week. Several video clips and audio recordings were registered by the commercial arm of the Just Keep Livin’ Foundation, a non-profit created by the Oscar-winning actor and his wife, Camila, according to the US Patent and Trademark Office database. Many artists are increasingly concerned about the uncontrolled use of their image via generative AI since the rollout of ChatGPT and other AI-powered tools. Several US states have adopted
A proposed billionaires’ tax in California has ignited a political uproar in Silicon Valley, with tech titans threatening to leave the state while California Governor Gavin Newsom of the Democratic Party maneuvers to defeat a levy that he fears would lead to an exodus of wealth. A technology mecca, California has more billionaires than any other US state — a few hundred, by some estimates. About half its personal income tax revenue, a financial backbone in the nearly US$350 billion budget, comes from the top 1 percent of earners. A large healthcare union is attempting to place a proposal before
KEEPING UP: The acquisition of a cleanroom in Taiwan would enable Micron to increase production in a market where demand continues to outpace supply, a Micron official said Micron Technology Inc has signed a letter of intent to buy a fabrication site in Taiwan from Powerchip Semiconductor Manufacturing Corp (力積電) for US$1.8 billion to expand its production of memory chips. Micron would take control of the P5 site in Miaoli County’s Tongluo Township (銅鑼) and plans to ramp up DRAM production in phases after the transaction closes in the second quarter, the company said in a statement on Saturday. The acquisition includes an existing 12 inch fab cleanroom of 27,871m2 and would further position Micron to address growing global demand for memory solutions, the company said. Micron expects the transaction to
RSS