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Capital goods imports to back Taiwan 2014 GDP growth: bank

Capital goods imports to back Taiwan 2014 GDP growth: bank

Taipei, Jan. 8 (CNA) A strong rise in imports in December indicates that Taiwan's economy could gain momentum in 2014, even if exports for the month were lower than expected, according to an analysis by Standard Chartered Bank. The Ministry of Finance reported Tuesday that Taiwan's exports fell 1.9 percent year-on-year in December, below the market consensus of 0.5 percent growth and Standard Chartered's expectation of a 0.9 percent increase. But the increases in imports of capital goods and raw materials seen in the December figures signaled that country's economy is still likely to grow in the future, said Tony Phoo, a Taipei-based economist at Standard Chartered. "This marks improving producers' confidence, and in line with our view that higher capital spending and hiring in the manufacturing sector (will) provide strong support to overall GDP growth in 2014," he said in a report. Breaking down the December figures, exports of electronic components and information and communication products fell on both a monthly and annual basis for the second consecutive month, with shipments dropping after the year-end holiday season, Phoo said. That was accompanied by year-on-year declines in exports to the United States and Europe, Phoo said, but exports to China and Hong Kong increased for the second consecutive month on both a monthly and yearly basis due to rising demand ahead of Chinese New Year. On the upside, Taiwan's imports rose significantly by 10.1 percent year-on-year in December after declining for five consecutive months, the economist noted. More importantly, imports of capital goods jumped by 24.6 percent annually in December, the largest rise January 2013, Phoo said. Raw material imports grew 7.3 percent year-on-year, the first annual rise in the past four months, which also signaled renewed optimism for the future, Phoo said.
(By Jeffrey Wu)


Updated : 2021-05-17 19:29 GMT+08:00