Taiwan growth hit by low technology exports and US-China trade war
- Gross domestic product expanded 1.76 per cent in the fourth quarter of 2018 from a year earlier, the slowest pace since June 2016
- Two of the island’s heavyweight companies, chip maker Taiwan Semiconductor Manufacturing and manufacturer Foxconn, count Apple as a major customer
Taiwan’s economy grew at its slowest in more than two years in the fourth quarter of 2018 as the island’s technology exports floundered amid weaker global demand and the trade war between China and the United States.
The economy’s prospects look dimmer this year as rising trade protectionism and a slowing Chinese economy begin to take a toll on demand for semiconductors and other electronics.
Gross domestic product expanded 1.76 per cent in the October-December period from a year earlier, preliminary data showed on Thursday, the slowest pace since June 2016 and down from 2.27 per cent in the third quarter.
A Reuters poll of economists had estimated growth of 2 per cent.
For 2018 overall, growth was 2.60 per cent, the government statistics agency said, compared with the government’s downwardly revised forecast of 2.66 per cent.
In 2017, the economy expanded 3.08 per cent, according to the latest government data.
Analysts expect Taiwan’s economic growth to slow further in 2019 due to spillover from trade tensions between the United States and China – its two largest trading partners.
“The figures announced today are roughly within expectations mainly because Apple sales fell short of expectations in the fourth quarter,” said Kevin Wang, analyst at Taishin Investment Advisory.