FILE PHOTO: People cross a street in Nangang District in Taipei, Taiwan, October 26, 2021. REUTERS/Ann Wang
January 26, 2022
TAIPEI (Reuters) – Taiwan’s trade-reliant economy is expected to have expanded at a slightly faster pace in the fourth quarter supported by strong tech exports though unable to match the burning pace of earlier in the year, a Reuters poll showed.
Gross domestic product (GDP) likely grew 3.8% in October-December versus a year earlier, the poll of 25 economists shows, after it rose 3.7% year-on-year in the third quarter.
But that would still lag the 7.43% growth in the second quarter and 8.92% in the first quarter.
Policymakers have said they expect full-year 2021 growth to slightly exceed 6%, which would be the fastest pace in over a decade, since a 10.25% expansion in 2010.
Economists’ forecasts for preliminary GDP data due on Thursday varied widely from growth of 2.7% to as high as 4.9%.
As a key hub in the global technology supply chain for giants such as Apple Inc, Taiwan’s economy has outperformed many of its regional peers during the COVID-19 pandemic as it benefited from robust demand for its tech exports during the work-and-study-from-home trend.
But domestic consumption was hit by a rare rise in community COVID-19 transmissions starting mid-May and imposition of strict restrictions on gatherings and other curbs.
While that outbreak has now ended, the government is on alert for a smattering of local Omicron variant infections that began earlier in January, though curbs on people’s activities have been limited so far.
Fitch Solutions last week noted retail sales growth between September and November, pointing to a recovery in consumer spending.
“However, the emergence of highly infectious variants, such as Omicron, and the implementation of strict COVID-19 measures are a downside risk to our outlook,” it said.
Firms like Taiwan Semiconductor Manufacturing Co Ltd (TSMC) have also seen demand soar due to a global shortage of chips that has shuttered some auto production lines and affected consumer electronics.
Taiwan’s exports rose 29.4% in 2021 to a record high.
The economy in China, Taiwan’s largest trading partner, grew 8.1% in 2021 and 4.0% in the final quarter, faster than expected but still its weakest pace since the second quarter of 2020 off the back of weak consumption and a property downturn.
Taiwan’s preliminary figures will be released in a statement with minimal commentary. Revised figures will be released a few weeks later, with more details and forward-looking forecasts.
(This story corrects date data is due).
(Poll compiled by Devayani Sathyan, Prerana Bhat and Carol Lee; Reporting by Ben Blanchard; Editing by Kim Coghill)
Source: One America News Network
