Taiwan’s government on Friday said following a drop in main Chinese market demands the country’s exports fell for the first time within 2 years.
The Finance Ministry declared that exports fell by 5.3%, to $37.53 billion, in September a year ago, which is the first decline since June 2020. Factors including shrinking demand from China, tight monetary policy, as well as rising inflation have affected Taiwan’s exports, according to the ministry official Beatrice Tsai. She added when remote work equipment like tablets saw a boom, exports faced a decline last year.
In September, annual exports to China decreased 13.3% to $15.17 billion, versus a 9.9% shrinkage in August, which is attributed to the country’s economic issues. China’s trading data will not be declared until October 14th, when the weeklong National Day holiday comes to its end. Total exports of electronics components increased 2.4% (to $16.99) last month.
Meanwhile, chip shortages in the world are expected to continue more or less for the end of the year. Hence, production of semiconductor chips in Taiwan’s companies will continuously grow even though consumer electronics demand declines in some parts.
Companies like Taiwan Semiconductor Manufacturing Company, TSMC, mostly supply global tech giants such as Apple and provide chips for auto manufacturing companies and lower-end market. A report by TSMC on Friday stated that sales in the month of September saw a 36% rise on-year, 4.5% down from August. On Thursday, United Microelectronics Corporation (another Taiwanese company) declared 34.5% growth year-on-year in September.
The finance ministry forewarned “trouble ahead” due to tight monetary policy in the U.S. and Europe as manufacturing in several countries is dramatically decreasing. However, there is doubt over the prospects.The ministry also expressed concerns that these issues might throw a spanner in our exports for the fourth quarter.
Exports to the U.S. in September decreased 2.1% versus 2.3% a month earlier. In the meantime, the country’s imports dropped 2.4% to $32.5 billion, which was quite lower than what economists had predicted after a growth of 3.5% in the month of August. The finance ministry expected Taiwan’s exports in October could be in a range of a 3% to 6% shrinkage from a year ago.