• Wed. May 31st, 2023

Taiwan’s economy stays in contraction for 6th straight month in April


May 26, 2023

Taipei, Could 26 (CNA) Taiwan’s economy remained in contraction mode for the sixth consecutive month in April as weakening international demand continued to weigh on the country’s exports, the National Improvement Council (NDC) stated Friday.

The NDC stated its composite index of financial indicators remained unchanged in April at 11 but stayed in the “blue” variety of 9-16 on the Cabinet-level council’s 5-tier program, with blue indicating financial contraction, yellow-blue representing sluggishness, green signifying steady development, yellow-red referring to a warming economy, and red pointing to an overheated or booming economy.

Speaking with reporters, Wu Ming-hui (吳明蕙), head of the NDC’s Division of Financial Improvement, stated variables in the April composite index such as production, exports, cash provide and company sentiment remained weak.

Domestic demand appeared reasonably powerful, with retail sales and income posted by the meals and beverage business developing in a steady manner, which offset the influence resulting from a fall in outbound sales, Wu stated.

In April, Taiwan’s exports and export orders each fell for an eighth consecutive month, falling 13.three % and 18.1 %, respectively, from a year earlier amid inventory adjustments in each tech and old economy sectors.

Amongst the nine variables in the composite index, the subindex on nonfarm payrolls rose a single point from a month earlier, though the subindex on company sentiment in the regional manufacturing sector fell a single point, the NDC stated.

The subindexes on other seven variables such as cash provide, merchandise exports, and industrial production remained unchanged more than April, the NDC added.

Regardless of the composite index’s muted overall performance, the NDC’s major financial indicators, which gauge the financial climate more than the subsequent six months, moved greater for the sixth month in a row in April, albeit at a decreased pace.

In April, the major indicators rose .13 % from a month earlier, down from March’s .23 % raise and the smallest month-to-month raise for six months, the NDC’s information indicated.

In the six-month period, the major indicators rose two.26 %, according to the NDC.

Wu stated the slower development in the April major indicators showed that regional financial development momentum remained insufficient to have a comeback as a fall in international demand continued to hurt Taiwan’s exports, which serve as the backbone of the country’s economy.

Wu stated it was challenging to predict when the regional economy would enter the yellow-blue variety on the NDC’s grading program, as a fragile planet continued to push down demand.

Only when exports bounce back, production and sales of regional firms will get a increase, accordingly, Wu stated.

In addition, the market place for customer electronics gadgets such as phones and notebook computer systems stayed fragile, a important departure from powerful sales boosted by wants made by function from dwelling and remote studying in the COVID-19 pandemic era, Wu stated, adding it wants some time to digest inventories ahead of production picks up.

“The regional economy’s consolidation continues and there is no quick sign of a turnaround,” Wu stated. “But, Taiwan could have a improved second half than the very first on the back of a reasonably low comparison base more than the exact same period of final year.”

The NDC stated though the international financial slowdown will retain affecting Taiwan’s exports, demand for emerging technologies such as higher-overall performance computing devices, information centers, and artificial intelligence is anticipated to aid the country’s outbound sales.

The NDC added the government’s efforts to push for green power improvement and public function projects are anticipated to present help to the regional economy.

(By Hsieh Fang-wu and Frances Huang)