Trade Balance in Taiwan
Taiwan - Trade Balance
Exports contract further in May for seventh month running, April orders also decline
Merchandise exports fell 4.8% in annual terms in May, worsening from the 3.3% contraction registered in April and marking the seventh consecutive month of decline in Taiwan’s trade sector. As in previous months, the print was weighed on by weak global demand for tech products, the ongoing Sino-American trade war and a slowdown in mainland China. Export orders, which typically lead actual exports by two to three months, also fell 3.7% year-on-year in April, up from the 9.0% yoy fall logged in March. Furthermore, export order data was not yet affected by the latest escalation of the U.S.-China dispute in early May. Due notably to this factor, the government now expects export orders in May to slump further by 7.6% to 11.0%.
Despite a steeper overall contraction, the May print was not entirely negative, as exports of electronic product parts—accounting for just under a third of total exports—slightly rebounded after months of continuous decline. In addition, export growth for information, communication and audio-video products—a category that notably includes smartphones—accelerated at a strong pace. On the other hand, the contraction in exports steepened for other main product categories, mainly base metals, machinery, and plastics and rubber..
Meanwhile, imports fell 5.9% year-on-year in May, contrasting April’s 2.6% yoy growth. The 12-month trailing sum of exports fell 0.2% yoy, contrasting April’s 1.3% growth print, while growth of the 12-month trailing sum of imports fell from 7.2% in April to 5.7% in May. Lastly, the trade surplus ticked up to USD 4.5 billion from USD 4.4 billion in May 2018 (April 2019: USD 2.7 billion), while the 12-month trailing trade surplus inched up to USD 45.4 billion in May, from USD 45.3 billion in April.
Looking ahead, short-term prospects remain bleak, as Taiwan is critically vulnerable to a further escalation of tariffs between the U.S. and China. Tariffs currently drafted by the Trump administration on USD 300 billion of Chinese goods would indeed severely impact the tech sector, as Taiwan is a key part of the Chinese and global supply chains for tech products.. Nevertheless, according to a statement from the Ministry of Economic Affairs, which releases export order data, demand for tech products could rebound in H2 2019 thanks to new smartphone launches as well as increasing demand for applications such as 5G, cloud computing and artificial intelligence.
Our panelists forecast that exports will expand 2.6% in 2019 and imports will rise 2.7%, bringing the trade surplus to USD 50.7 billion. In 2020, our panel expects exports will expand 6.1%, while imports will rise 5.9%, bringing up the trade surplus to USD 54.4 billion.
Taiwan - Trade Balance Data
|Trade Balance (USD billion)||33.4||38.2||48.1||49.8||58.0|
5 years of economic forecasts for more than 30 economic indicators.
Taiwan Trade Balance Chart
Source: Central Bank of China.
|Bond Yield||0.71||1.28 %||Jun 13|
|Exchange Rate||31.48||0.07 %||Jun 13|
|Stock Market||11,561||0.37 %||Jun 13|
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June 11, 2019
Merchandise exports fell 4.8% in annual terms in May, worsening from the 3.3% contraction registered in April and marking the seventh consecutive month of decline in Taiwan’s trade sector.
June 5, 2019
Consumer prices rose 0.15% in May from the previous month, down from the 0.75% increase logged in April.
June 3, 2019
Operating conditions in the Taiwanese manufacturing sector continued to deteriorate in May for the eighth month running, though at a marginally slower pace than in April.
May 23, 2019
Industrial output increased 1.0% year-on-year in April, contrasting the 9.4% year-on-year decline logged in March—the worst fall in the production index since January 2012.Output in the manufacturing sector—which represents more than 90% of total industrial production—rose 0.9% in April, contrasting the 11.0% fall registered in March.
May 7, 2019
Consumer prices rose 0.75% in April from the previous month, contrasting the 0.62% decline logged in March.