TAIPEI: Taiwan’s exports in May fell for a third straight month but at a slower pace than expected, with the government “cautious” about the outlook due to the impact of the coronavirus pandemic on global demand and U.S.-China frictions.
Exports dropped 2.0% from a year earlier to $27 billion in May, the finance ministry said on Monday. A Reuters poll had forecast an annual drop of 4.7%.
In April, exports slipped 1.3%.
The ministry said strong demand for telecommuting amid the coronavirus outbreak and advanced chips was offset by weakening global consumption for products from textiles to plastics.
Exports for telecommunications products and tech gadgets jumped nearly 11% from a year earlier to their third highest monthly record, but the telecommuting boom could be disrupted by the coronavirus crisis and renewed U.S.-China trade tensions, the ministry said.
“Our foreign trade is facing a high degree of uncertainty. The outlook is likely to be cautious,“ the ministry said in a statement.
May imports fell by a more-than-expected 3.5%, against economists’ expectations of 2.1%.
Taiwan, whose largest trading partner is China, could see June exports come in within a range of -2% to -5% on the year, Beatrice Tsai, head of the ministry’s statistics department, told reporters.
While Taiwan has prevented a rapid spread of the COVID-19 disease without going into total lockdown, the government has repeatedly warned of economic uncertainty and is rolling out a stimulus package worth T$1.05 trillion ($35.34 billion).
It has also pledged to attract manufacturers to move production home from China and is seeking to draw foreign tech firms.
Taiwan’s economic growth is likely to slow to its weakest in five years in 2020 as the pandemic hurts domestic consumption and the job market, though strong global demand for electronics could cushion the blow for the island.
In neighbouring China, exports contracted in May as global coronavirus lockdowns continued to devastate demand, while a sharper-than-expected fall in imports pointed to mounting pressure on manufacturers as global growth stalls. -Reuters