Investments in fixed assets, excluding land, by the nation’s manufacturing sector increased by 0.1 percent year-on-year to NT$497 billion (US$16.18 billion) last quarter, down from a 25.6 percent increase the previous quarter and the lowest growth in the past seven quarters, the Ministry of Economic Affairs said yesterday.
Makers of chemical materials and metal products expanded their factories and purchased additional equipment last quarter, while state-owned enterprises continued to carry out major construction projects, the ministry said.
However, those manufacturers’ increased investments in fixed assets were partially offset by a drop in investments by semiconductor companies due to weakening end-market demand, it said.
Photo: CNA
On a quarterly basis, the figure decreased 7.8 percent from NT$539 billion the previous quarter, the ministry said in a report.
The electronic components industry topped all industry sectors, with fixed-asset investments of NT$329.8 billion contributing to 66.4 percent of the total, the report said.
However, the figure declined 5.1 percent annually, mainly due to the slowdown in demand, which resulted in semiconductor firms postponing some capital spending, although the comparison base was relatively high in the same period last year, it said.
There was a 15.1 percent decline in fixed-asset purchases by other makers of electronic and optical components because of last year’s high comparison base, the ministry said.
The chemical materials industry ranked second with fixed-asset investments of NT$26.2 billion, up 21.1 percent from a year earlier, the report said.
That was because firms in the supply chain had expanded factories and production lines, and repaired and improved manufacturing equipment to meet demand for silicon wafers and related chemicals used in automotive, 5G and cloud-based devices, it said.
The metal product industry placed third, with fixed-asset purchases soaring 29.4 percent to NT$17.6 billion on the back of steady investments by offshore wind power developers, and the installment of smart manufacturing facilities and green power equipment by local companies, the report said.
Makers in the machinery, petroleum and coal products, and base metal industries also reported an annual increase in fixed-asset investments last quarter, as they continued to expand capacity and upgrade equipment to prepare for future demand, it said.
In the first three quarters of the year, fixed-asset investments in the manufacturing sector surged 13.8 percent year-on-year to NT$1.52 trillion, the ministry said.
Going forward, Russia’s war in Ukraine, higher inflationary pressure and rising global economic uncertainties are expected to weigh on local manufacturers’ fixed-asset investments, it added.
Meanwhile, revenue from the manufacturing sector — including sales from overseas production — rose 7 percent annually to NT$8.99 trillion last quarter, a record for the July-to-September period and the eighth consecutive quarter of annual expansion, the report said.
The revenue increase was driven by electronics firms, such as those that manufacture products used in handsets, automotive electronics and high-performance computing devices, as well as petrochemical, textile and rubber firms due to higher global oil prices, the report said.
The quarterly result brought combined revenue to NT$26.08 trillion in the first three quarters, up 10.7 percent from a year earlier, the report showed.
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