The government’s business climate monitor last month flashed “green” for the third consecutive month due to strong exports, which in turn benefited electrical and machinery equipment imports, the National Development Council (NDC) said yesterday.
The total score of the nine constituent readings gained 1 point from the previous month, increasing to 30.
This indicates a state of steady growth, thanks to aggressive spending of global technology titans on artificial intelligence (AI) infrastructure, NDC research director Wu Ming-huei (吳明蕙) said.
Photo: CNA
Taiwan is home to the world’s major suppliers of advanced chips, high-end servers, storage and memory devices.
“The nation’s exports would thrive, with the landscape looking bright and clear for AI applications,” Wu told a news conference in Taipei.
The council uses a five-color system to indicate the state of the nation’s economy, with “green” meaning steady growth, “red” suggesting a boom and “blue” signaling a recession. Dual colors suggest a transition to a stronger or weaker state.
Outbound shipments last month expanded 18.9 percent year-on-year to US$41.82 billion, with information and communications technology products more than doubling, the Ministry of Finance said earlier this month.
The uptrend is expected to gather steam this quarter, with more product categories to emerge from a slowdown, the ministry said.
Similarly, the tracker on stock price movements showed a boom signal, as the TAIEX rallied above the 20,000-point mark, prompting foreign portfolio managers to lower their holdings and lock in profit, the NDC report said.
The index of leading indicators, which forecasts the economic condition in the following six months, climbed 0.32 percent month-on-month to 101.5, as readings on export orders, money supply, share prices, labor accession rate and business confidence gained headway.
The improvements came even though imports of semiconductor equipment and construction floor space declined, the NDC said.
Local firms remained generally cautious about capital spending on concerns over stubborn inflation in the US and geopolitical tensions in the Middle East.
The index of coincident indicators, which reflects the current economic situation, rose 0.64 percent to 101.45, as all constituent readings on electricity use, overtime hours, and wholesale, retail and restaurant revenues picked up, the council said.
Local firms would benefit further from the positive technology product cycle, but risks regarding restrictive monetary policy in the US, volatile geopolitical tensions and US-China trade disputes warrant caution, the NDC said.
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