Taiwan’s Export Orders Increase for Second Month
Taiwan’s export orders climbed for a second consecutive month in November as demand for the island’s semiconductors, television screens and computers rose.
Orders, an indication of shipments in the next one to three months, rose 37.11 percent from a year earlier, after a 4.41 percent gain in October, the Ministry of Economic Affairs said in Taipei today. The median estimate of 10 economists in a Bloomberg News survey was for a 38.06 percent advance.
Taiwan is dependent on a revival of exports, which make up more than half of its economy, to recover from a yearlong recession. Increasing demand for electronics prompted Quanta Computer Inc. to forecast rising shipments next year and Taiwan Semiconductor Manufacturing Co., the island’s biggest company by market value, to boost capital spending in 2010.
“Taiwan’s electronics companies have been posting monthly revenue increases in November from October, and that shows a recovery in demand,” said Alan Liao, an economist at Chinatrust Commercial Bank in Taipei. “We expect the growth momentum to continue on a strengthening economic recovery.”
China’s economy, Taiwan’s biggest export market, expanded 8.9 percent last quarter from a year earlier, the fastest pace in a year, spurring sales for electronics makers including Mediatek Inc., Taiwan’s largest producer of handset chips.
AU Optronics Corp., Taiwan’s biggest maker of screens for televisions, is also seeking to expand production next year through acquisitions or construction of additional facilities.
Government Spending
Gross domestic product shrank 1.29 percent in the three months through September, the slowest pace in a year, after contracting a revised 6.85 percent in the second quarter. GDP will probably rise 4.39 percent in 2010, after falling 2.53 percent this year, the cabinet’s statistic bureau said Nov. 26.
President Ma Ying-jeou’s administration plans NT$858.5 ($26.5 billion) of spending over four years, or about 6 percent of GDP, on infrastructure, consumer grants and tax cuts to help revive the economy.
Governor Perng Fai-nan will keep interest rates unchanged at a record-low 1.25 percent when the central bank’s board meets tomorrow, according to analysts surveyed by Bloomberg News. The bank cut borrowing costs by 2.375 percentage points from September 2008 to February to try to boost the economy.
Industrial production rose 31.46 percent in November from a year earlier, today’s report showed.
Morris Chang, chairman and chief executive officer of Taiwan Semiconductor, the world’s largest custom-chip maker, said this month 2010 capital spending will be “much higher” than $2.7 billion budgeted for this year.
Industry Barometer
The company, a barometer for the industry because it makes chips for everything from mobile phones to medical equipment, said this week it will raise the base salary for all employees by 15 percent from next year as part of structural changes to the way it compensates workers.
Quanta, the world’s largest maker of notebook computers by revenue, posted third-quarter profit that beat analysts’ estimates. The company, whose clients include Apple Inc. and Hewlett-Packard Co., expects laptop shipments to rise 40 percent to 50 million next year
The value of export orders was $31.26 billion last month, compared with $31.75 billion in October, today’s report showed.
Export orders to China and Hong Kong combined increased 73.32 percent last month, compared with a gain of 19.6 percent in October. Orders from the U.S. climbed 28.27 percent from a year earlier, compared with a 0.67 percent gain in October.
Demand from the U.S., Taiwan’s second-largest export market, is improving as the economy recovers from the deepest recession since the Great Depression.
Orders for electronics rose 43.23 percent last month, compared with an increase of 4.07 percent in October, today’s report showed. Demand for information technology and communications products climbed 33.91 percent in November, after rising 5.63 percent the previous month.
Filed under: technology by Wolf