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Taiwan cannot count on new iPhones to boost exports: TIER

Taiwan cannot count on new iPhones to boost exports: TIER

Taipei, Sept. 12 (CNA) While Apple Inc. unveiled its latest iPhone models last week, raising optimism toward Taiwanese suppliers' shipments, the Taiwan Institute of Economic Research (TIER) said Monday that global demand remains slow, so that Taiwan cannot count on the new iPhones to raise its exports for the rest of this year.

In a seminar held by the TIER on the economic climate in the region, Gordon Sun, director of the TIER's Economic Forecasting Center, said that with major economies such as Europe, the United States, China and Japan having shown no signs of any meaningful rebound, Taiwan is expected to continue its slow pace in economic recovery.

Many market analysts, and even the government, have anticipated that Apple's new smartphones -- the 4.7-inch iPhone 7 and the 5.5-inch iPhone 7 Plus, which were launched Sept. 7 and will go on global sale Sept. 16, will give a boost to Apple concept stocks in Taiwan in terms of outbound sales.

These Taiwanese suppliers to Apple account for about 40 percent of market capitalization of the local equity market and play a critical role in Taiwan's outbound sales. Taiwan's economy depends heavily on outbound sales, since exports make up about 60 percent of the country's gross domestic product.

But Sun said that such anticipation over the presence of the new iPhones has been too optimistic and he preferred to hold a cautious attitude, since Taiwan cannot isolate itself from the slow global economy.

In the first eight months of this year, Taiwan's exports totaled US$180.1 billion, down 6.6 percent from a year earlier. But the country's outbound sales in August rose 1 percent from a year earlier, marking the second consecutive month in which exports have recorded a year-on-year increase.

In response to the export improvement in the past two months, the Ministry of Finance said earlier this month that the export growth momentum is expected to continue into September during the current peak season for the global high-tech industry.

Sun said he remained cautious about the pace of the global economic growth, as China -- the second-largest economy in the world, and with close business ties with Taiwan -- expected to have a longer-than-expected transition period.

The TIER economist said that the global economy is unlikely to have a significant rebound until 2018. He said that it is not wise to expect too much from Taiwan's economy in the short term just because the new iPhones are hitting the market.

By taking an improvement in Taiwan's outbound sales into account, however, the government raised its forecast of the country's economic growth to 1.22 percent in 2016, an increase of 0.16 percentage points from its previous estimate in mid-August. (By Tsai Yi-chu and Frances Huang)

Updated : 2021-05-08 01:02 GMT+08:00