( Observer Network News) After two months of growth, Taiwan’s export orders fell again in July. This indicator is very different from previous economists' forecasts. Bloomberg pointed out that this is even worse than the "most pessimistic forecast" made by Bloomberg economists, which originally forecast a growth of 6.2%.
According to data released by Taiwan’s economic department on August 22, export orders in July were US$54.26 billion, a decrease of approximately 1.9% compared with the same period last year. Taiwan's "Economic Daily" pointed out that rising geopolitical risks such as the Russia-Ukraine conflict, Sino-US relations, and tensions in the Taiwan Strait will "suppress the growth momentum of Taiwan's export orders" in the long term. It is expected that it will continue to fall by 0.9% to 3.7% in August, ushering in a "second consecutive decline".
Taiwan’s export orders in July fell by about 1.9% compared with the same period last year. Picture from Taiwan's economic department
Taiwan's statistics department originally expected July's export orders to increase by 0.4% to 3.1% last month, barely maintaining positive growth. However, in fact, July's export orders "unexpectedly" fell by 1.9%.
From the perspective of the economic sector, although the annual stocking season for consumer technology products such as mobile phones is about to begin, communications manufacturers still behave conservatively.
Among Taiwan’s export commodities, except for electronic products, which hit a new high in July with orders of US$17.78 billion, an increase of 8.8%, the six major categories of communications, chemicals, machinery, metals, rubber, and optical equipment all experienced declines. Among them, optical equipment and rubber products experienced the largest declines, falling by 37.4% and 26.3% respectively.
In addition, from a regional perspective, mainland China (including Hong Kong) accounts for 20.5% of Taiwan's export orders, second only to the United States at 32.4%, while Europe ranks third, accounting for 17.8%. In July this year, data showed that orders from mainland China (including Hong Kong) fell by 22.6%, falling for four consecutive months. In Europe, the number of orders fell by 5.1% due to factors such as rising energy prices due to the Russia-Ukraine conflict, resulting in inflation and slowdown in infrastructure demand. Although the US order volume increased by 6.9% and and ASEAN increased by 22.9%, it is still difficult to conceal the decline.
It should be noted that the above is only export order data. In terms of export value data, mainland China (including Hong Kong) was still Taiwan's largest export market (USD 10.51 billion, accounting for 24.3%) in July.
In April this year, Taiwan’s export orders fell by 5.5%. The Economic Daily pointed out that this was the second time Taiwan experienced negative growth in three months since April this year, and the performance was significantly lower than expected.
Not only that, the next August is obviously not optimistic either.
According to Taiwan’s economic department, under the influence of factors such as the epidemic, inflation, and the situation in the Taiwan Strait, the export order volume in August is expected to be approximately US$51.5 billion to US$53 billion, a decrease of 0.9% to 3.7% compared with the same period last year, and is about to appear. "Second consecutive decline".
The decline in export sales is obvious. Analysts from Taiwan's economic department said that first of all, the Federal Reserve's interest rate hike led global central banks to raise interest rates, inflation remains high, resulting in continued weak end market demand, and global industries must first adopt inventory adjustment strategies.
Secondly, rising geopolitical risks such as the conflict between Russia and Ukraine, competition between China and the United States, and tensions in the Taiwan Strait will "suppress the growth momentum of Taiwan's export orders" in the long term.
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