Taiwan’s economy last quarter rose 5.12 percent from a year earlier, missing the government’s forecast slightly by 0.1 percentage points, as investments and exports disappointed, the Directorate-General of Budget, Accounting and Statistics (DBGAS) said yesterday, citing an advance estimate report.
The latest GDP data showed full-year growth came in at a mild 1.4 percent, the softest in 14 years and slower than the 1.42 percent increase the statistics agency forecast in November last year.
DGBAS official Wang Tsui-hua (王翠華) pinned the blame squarely on poor capital formation on the part of the government, public enterprises and private corporations.
Photo: Ann Wang, Reuters
The GDP component turned out 3.86 percentage points behind the projection and eroded the fourth-quarter results by 2.31 percentage points, Wang said.
Local manufacturers generally practiced caution as inventory corrections lingered, she said.
In contrast, domestic airlines aggressively expanded their fleet to meet strong overseas travel demand, she said.
Soft manufacturing activity helped account for a 27.51 percent plunge in imports of capital equipment during the October-to-December period, DGBAS said.
Local semiconductor firms tightened capital spending as they grappled with economic uncertainty.
Exports of goods and services, normally the main growth driver, increased 3.58 percent last quarter, but fell short of the government’s expectation by 2.38 percentage points, the agency said.
The below-par numbers came even though local electronics suppliers reaped a windfall from fast-growing demand for artificial intelligence and high-performance computing devices.
Imports fared worse with a 4.26 percent decline last quarter, missing the government’s forecast by 4.57 percentage points, owing to weak demand and falling raw material prices, DGBAS said.
Private consumption proved the only bright spot, beating expectations with growth of 5.44 percent last quarter from a year earlier, Wang said.
Shopping and dining momentum was strongest in the final quarter of the year when retailers rolled out discounts to promote sales and companies threw traditional year-end banquets for employees, she said.
Private consumption received further support from vehicle sales and the TAIEX’s rally, while the local bourse saw capital inflows seeking to take advantage of a tech cycle recovery, Wang said.
Inventory corrections might come to an end in the first half of this year, she said.
DGBAS is to make an official update of its GDP forecast later this month.
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