The nation's export orders suffered their biggest monthly fall in September as the country's industrial operations were held up by the terror attacks in the US and Typhoon Nari, officials said yesterday.
Export orders last month plunged 26.8 percent year-on-year to US$10.48 billion with demand for electronics and telecommunications products hardest hit, the Ministry of Economic Affairs reported.
Contracts for electronics goods plummeted 40.2 percent to US$2.11 billion, while demand for information technology and telecommunications products dropped 36.4 percent to US$1.74 billion.
Between US$1.5 billion and US$2 billion of orders were canceled after the attacks on New York and Washington, said the ministry's statistics department director Chang Yaw-tzong (
The US slump has hit Taiwan harder than most Asian economies and it could be two years until economic growth returns to the 6 percent rate it's averaged the past nine years.
"It's likely to get worse in the fourth quarter, in terms of US consumer retrenchment," said Paul Alapat, an economist at Nomura International (Hong Kong) Ltd. "A fully fledged normalization of economic growth isn't expected until 2003."
Taiwan's economy was already shrinking before last month's attacks, contracting 2.35 percent in the second quarter from a year ago. Other Asian countries are also hurting -- Singapore is in the midst of its deepest recession since 1964 and Japan is probably in its fourth recession in just over a decade. The Japanese government said exports fell 4.6 percent last month.
Chang added that much of Taiwan's industrial activity last month was also held up by power outages from flooding brought by Nari, which devastated parts of northern Taiwan with the worst floods in a century.
But Chang said export orders are likely to return to positive growth in the first quarter of next year in the best-case scenario.
"While it remains to be seen how the US-Afghanistan war will affect the world, we cannot rule out the possibility of such a recovery being delayed to the second half of next year."
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