The business outlook of local firms in a variety of sectors turned increasingly bleak last month as the nation’s GDP growth struggles to stay above the 1-percent level this year, the Taiwan Institute of Economic Research (TIER, 台經院) said yesterday.
“The economy may have difficulty logging growth of more than 1 percent this year if the equity slumps persist, hurting consumer confidence and domestic demand,” said Gordon Sun (孫明德), director of the Taipei-based think tank’s economic forecasting center.
Private consumption, which had been relied upon on to drive the economy this year amid faltering exports, looks set to miss its target given the decline in retail and commercial sales last month, Sun said.
Photo: Wang Meng-lun, Taipei Times
Ongoing stock market corrections would further sap consumer spending, dragging GDP into the negative zone this quarter, from a neutral 0.1 percent growth as projected by the Directorate-General of Budget, Accounting and Statistics on Aug. 14, Sun said.
The business climate gauge for the manufacturing industry stood at 92 last month, down 1.62 points form the revised 93.62 in June, the TIER’s monthly survey showed.
Only 18.8 percent of manufacturers held optimistic views about their business for the coming six months, down 6.4 points from one month earlier, the survey found.
Manufacturers’ pessimism rose 14.2 points to 31.7 percent, reflecting tepid demand abroad, the survey found.
“It is unusual that companies should turn conservative with the advent of high sales season… They are likely to fail to receive new business orders,” Sun said.
Worse-than-expected exports and private consumption would put the official forecast of 1.56 percent GDP growth this year out of reach, he said.
Firms involved in data storage, machinery equipment and car production are especially pessimistic, the survey found.
The business sentiment reading for the service sector was 88.39 last month, a loss of 2.57 points from the revised 90.96 in June, the survey said.
Securities houses bore the brunt of drastic stock plunges and companies involved in retail sales have the lowest confidence about business prospects, the survey said.
The business climate score for the construction industry registered 79.75 last month, representing a tiny rebound of 0.85 point from one month earlier, the survey said.
The central bank’s partial easing of mortgage restrictions accounted for the improvement, TIER said, adding that some builders and developers may launch home projects next month in line with traditional seasonality.
However, the property market remains soft because of unfavorable policy changes and political uncertainty linked to the presidential and legislative elections in January, the TIER said.
AIR SUPPORT: The Ministry of National Defense thanked the US for the delivery, adding that it was an indicator of the White House’s commitment to the Taiwan Relations Act Deputy Minister of National Defense Po Horng-huei (柏鴻輝) and Representative to the US Alexander Yui on Friday attended a delivery ceremony for the first of Taiwan’s long-awaited 66 F-16C/D Block 70 jets at a Lockheed Martin Corp factory in Greenville, South Carolina. “We are so proud to be the global home of the F-16 and to support Taiwan’s air defense capabilities,” US Representative William Timmons wrote on X, alongside a photograph of Taiwanese and US officials at the event. The F-16C/D Block 70 jets Taiwan ordered have the same capabilities as aircraft that had been upgraded to F-16Vs. The batch of Lockheed Martin
GRIDLOCK: The National Fire Agency’s Special Search and Rescue team is on standby to travel to the countries to help out with the rescue effort A powerful earthquake rocked Myanmar and neighboring Thailand yesterday, killing at least three people in Bangkok and burying dozens when a high-rise building under construction collapsed. Footage shared on social media from Myanmar’s second-largest city showed widespread destruction, raising fears that many were trapped under the rubble or killed. The magnitude 7.7 earthquake, with an epicenter near Mandalay in Myanmar, struck at midday and was followed by a strong magnitude 6.4 aftershock. The extent of death, injury and destruction — especially in Myanmar, which is embroiled in a civil war and where information is tightly controlled at the best of times —
Taiwan was ranked the fourth-safest country in the world with a score of 82.9, trailing only Andorra, the United Arab Emirates and Qatar in Numbeo’s Safety Index by Country report. Taiwan’s score improved by 0.1 points compared with last year’s mid-year report, which had Taiwan fourth with a score of 82.8. However, both scores were lower than in last year’s first review, when Taiwan scored 83.3, and are a long way from when Taiwan was named the second-safest country in the world in 2021, scoring 84.8. Taiwan ranked higher than Singapore in ninth with a score of 77.4 and Japan in 10th with
SECURITY RISK: If there is a conflict between China and Taiwan, ‘there would likely be significant consequences to global economic and security interests,’ it said China remains the top military and cyber threat to the US and continues to make progress on capabilities to seize Taiwan, a report by US intelligence agencies said on Tuesday. The report provides an overview of the “collective insights” of top US intelligence agencies about the security threats to the US posed by foreign nations and criminal organizations. In its Annual Threat Assessment, the agencies divided threats facing the US into two broad categories, “nonstate transnational criminals and terrorists” and “major state actors,” with China, Russia, Iran and North Korea named. Of those countries, “China presents the most comprehensive and robust military threat
RSS