Taiwan would continue to ride the wave of artificial intelligence (AI) and outperform other Asian countries in economic performance this year, while the world copes with uncertainties linked to drastic shifts in US trade policy, HSBC Holdings PLC said yesterday.
The demand for Taiwan’s high-tech products used in AI is strong, and high-end computing would help boost the nation’s exports and capital expenditures, HSBC chief Asia economist and global research cohead Frederic Neumann told a news briefing in Taipei.
On the domestic front, Taiwan’s private consumption is poised to keep pace with its long-term economic trajectory, Neumann said, adding that the nation’s healthy labor market conditions — with unemployment rates consistently below 3.5 percent and more flexible wage growth — indicate that households’ spending power has been improving.
Photo courtesy of HSBC Taiwan
Data suggest that private consumption in Taiwan is resilient, and consumer sentiment remains healthy, as household spending plans so far have been above their long-term average, HSBC said.
Unlike other markets in Asia, such resilience has less to do with mitigating inflation, and more to do with a rebound in wage growth, the bank said, adding that Taiwan’s real wage growth has climbed to its highest level in many years, providing continued support for consumption.
While global demand for Taiwan’s technology products would help the recovery of the nation’s capital expenditure, further intensification of global trade protectionism would pose a downside risk that needs attention, Neumann said.
The lack of clarity on US tariffs would inevitably affect cross-border investments, at least in the short term, which would be negative for the Asian supply chain, HSBC said.
This could indirectly drag down economic growth in Asia, especially in Southeast Asian markets where Taiwanese firms have manufacturing bases and foreign direct investment inflows account for a large proportion of the overall economy, it said.
“Gone are the days when smaller markets benefited from exports as the US and China grappled with trade issues,” Neumann said. “Today’s world is much more turbulent and requires inner strength to support it.”
NEW IDENTITY: Known for its software, India has expanded into hardware, with its semiconductor industry growing from US$38bn in 2023 to US$45bn to US$50bn India on Saturday inaugurated its first semiconductor assembly and test facility, a milestone in the government’s push to reduce dependence on foreign chipmakers and stake a claim in a sector dominated by China. Indian Prime Minister Narendra Modi opened US firm Micron Technology Inc’s semiconductor assembly, test and packaging unit in his home state of Gujarat, hailing the “dawn of a new era” for India’s technology ambitions. “When young Indians look back in the future, they will see this decade as the turning point in our tech future,” Modi told the event, which was broadcast on his YouTube channel. The plant would convert
Nanya Technology Corp (南亞科技) yesterday said the DRAM supply crunch could extend through 2028, as the artificial intelligence (AI) boom has led the world’s major memory makers to dramatically reduce production of standard DRAM and allocate a significant portion of their capacity for high-bandwidth memory (HBM) chips. The most severe supply constraints would stretch to the first half of next year due to “very limited” increases in new DRAM capacity worldwide, Nanya Technology president Lee Pei-ing (李培瑛) told a news briefing. The company plans to increase monthly 12-inch wafer capacity to 20,000 in the first half of 2028 after a
Property transactions in the nation’s six special municipalities plunged last month, as a lengthy Lunar New Year holiday combined with ongoing credit tightening dampened housing market activity, data compiled by local land administration offices released on Monday showed. The six cities recorded a total of 10,480 property transfers last month, down 42.5 percent from January and marking the second-lowest monthly level on record, the data showed. “The sharp drop largely reflected seasonal factors and tighter credit conditions,” Evertrust Rehouse Co (永慶房屋) deputy research manager Chen Chin-ping (陳金萍) said. The nine-day Lunar New Year holiday fell in February this year, reducing
Zimbabwe’s ban on raw lithium exports is forcing Chinese miners to rethink their strategy, speeding up plans to process the metal locally instead of shipping it to China’s vast rechargeable battery industry. The country is Africa’s largest lithium producer and has one of the world’s largest reserves, according to the US Geological Survey (USGS). Zimbabwe already banned the export of lithium ore in 2022 and last year announced it would halt exports of lithium concentrates from January next year. However, on Wednesday it imposed the ban with immediate effect, leaving unclear what the lithium mining sector would do in the
RSS