Taiwan cuts 2023 GDP forecast with global electronics demand showing ‘no signs’ of recovery

Taiwan, which ships PCs and smartphones to much of the world, has lowered its 2023 economic growth forecast amid predictions that consumers will buy fewer electronic goods this year.

The Directorate General of Budget, Accounting and Statistics on Wednesday revised down its gross domestic product (GDP) growth forecast to 2.12 per cent, 0.63 percentage points below the government’s November outlook.

The forecast would be Taiwan’s lowest growth rate in eight years, after GDP grew 2.43 per cent in 2022, below the government forecast of 3.06 per cent.

“We expect external demand for Taiwan’s key merchandise exports to remain subdued in the coming quarter, as consumers and businesses cut spending in light of multiple growth headwinds and rising interest rates,” said George Xu, associate director for Asia-Pacific sovereign ratings at Fitch Ratings.

Notebook PCs shipped from Taiwan will decline by 10 per cent this year versus last, falling to 136,052 units, the Taipei-based Market Intelligence and Consulting Institute said. The institute forecast smartphone shipments from the island will reach 283 million units this year, a decrease of about 5.9 per cent over 2022.

Globally, shipments of smartphones reached 1.23 billion last year, 12 per cent less than in 2021, according to data from market research firm Counterpoint. It forecasts a similar number in 2023.