Taiwan’s economy last quarter expanded 3.92 percent, surpassing an earlier forecast of 3.3 percent and prompting the Directorate-General of Budget, Accounting and Statistics (DGBAS) to steeply adjust its full-year growth forecast to 2.54 percent from 1.56 percent.
The expansion indicates a V-shaped recovery from a 0.58 percent decline in the second quarter due to the COVID-19 pandemic.
“Exports turned out much stronger than expected, with outbound shipments beating the agency’s estimate by US$6 billion in the third quarter,” Statistics Department head Tsai Yu-tai (蔡鈺泰) said.
Photo: Ann Wang, Reuters
Robust exports pushed up quarterly growth to the highest level since the second quarter of 2015, propelled by demand for 5G deployment, remote working and distance education, Tsai said.
Taiwan is home to the world’s largest contract makers of chips and electronics used in smartphones, notebook computers and data centers, allowing it to benefit from a crisis that has wreaked havoc on the global economy.
Outbound shipments this quarter might increase 7.75 percent year-on-year, as demand for new technology applications remains strong, the agency said.
Imports are expected to continue to decline by 1.65 percent, weighed down by cheap oil and the price of raw materials, although this effect is diminishing, it added.
Private consumption was disappointing, shrinking 1.48 percent, but easing from a 5.21 percent retreat three months earlier, it said.
Private investment has failed to meet expectations, with an expected annual pickup of 2.41 percent adjusted downward to 1.47 percent, Tsai said.
Consumer spending continued to take a hit from the pandemic, although the GDP component has greatly improved since the COVID-19 situation eased in May, he said.
Airlines saw passenger numbers in the third quarter slump 86.89 percent, while declines hovered at 10 percent for trains and other public transport, the agency said.
Private consumption might contract 2.52 percent for the year, deeper than an earlier forecast of 1.44 percent, it said.
The agency’s GDP growth forecast for next year was trimmed from 3.92 percent to 3.83 percent, after factoring in a higher comparison base this year and lingering effects of the pandemic.
The global economic outlook looks grim after European countries and US states shut down non-essential businesses to rein in COVID-19 cases, DGBAS Minister Chu Tzer-ming (朱澤民) said.
“Taiwan must stay alert,” Chu added.
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