TAIPEI, Feb 15 (Reuters) - Taiwan’s exports contracted for a third straight month in January, albeit at a much slower pace than expected which analysts said was partly because traders shifted their orders to Taiwan from China due to a tariff increase.
However, they said the island’s exports would continue to stay weak in the coming months as technology shipments flounder amid weak global demand and a prolonged U.S.-China trade war.
“Exports in the first quarter are likely to decline (from a year ago),” said Taishin Securities Investment Advisory economist Kevin Wang, citing a slowing global economy.
The finance ministry expects exports in February to drop 1 to 3.5 percent from a year earlier, an official told a news conference in Taipei.
January exports dropped 0.3 percent from a year earlier, data from the finance ministry showed on Friday, beating a forecast of 2.93 percent decline in a Reuters poll of analysts. In December, the trade-reliant economy’s exports had contracted 3 percent on year.
Taiwan’s factories are a key part of the global supply chain for tech giants such as Apple Inc.
Earlier this week, the statistics agency cut its 2019 export growth forecast to 0.19 percent from 1.96 percent projected in November. It also lowered its economic growth estimate to 2.27 percent from 2.41 percent, citing growing global uncertainties.
Last month, the Ministry of Economic Affairs said it was “not too optimistic” that first-quarter export orders growth would be strong due to slowing demand for tech products.
January’s continued contraction of exports comes at a time when the island’s major technology companies point to a gloomy short-term outlook.
Taiwan Semiconductor Manufacturing Co Ltd, the world’s largest contract chipmaker, forecast in January its sharpest quarterly revenue fall in a decade. Apple’s key supplier Foxconn posted its first year-on-year drop in monthly revenue in December amid tepid demand for electronics. (Reporting By Yimou Lee, Emily Chan and Roger Tung; Editing by Subhranshu Sahu)
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