Get more with myNEWS
A personalised news feed of stories that matter to you
Learn more
Global demand for 5G-related applications, including infrastructure and smartphones, boosted Taiwan’s exports of electronics products, including semiconductors, in August. Photo: Agence France-Presse

Taiwan exports surge to record amid Huawei scramble for chips

  • Overseas shipments from Taiwan increased 8.3 per cent in August to a record high of US$31.2 billion, aided by suppliers rushing to deliver hi-tech components to Huawei
  • The grace period for the US export ban on Huawei ends on September 14
Taiwan’s exports rose to a record in August, aided by suppliers rushing to ship as many components as possible to Huawei Technologies before a US ban on sales to the company comes into effect next week.

Overseas shipments from Taiwan increased 8.3 per cent last month to a record high of US$31.2 billion, according to a statement from Taiwan’s Ministry of Finance on Monday.

That was more than even the most bullish estimate in a survey of 13 economists, which had a median forecast of a 0.8 per cent gain. Imports unexpectedly rose 8.5 per cent and the trade surplus widened to US$6.47 billion.

The size of the increase was “unexpectedly strong”, according to the ministry’s chief statistician Beatrice Tsai, who also cited the upcoming launch of new smartphones as a contributing factor.
There were four main drivers of the export surge, according to the finance ministry’s statement: the impending US ban on technology sales to Huawei; rising demand for technology products to allow people to work and study at home amid ongoing Covid-19 lockdowns; a seasonal pickup in demand in the second half of the year; and stabilising global material prices.

The grace period for Huawei’s US export ban ends on September 14. Huawei helped add between US$1.5 billion and US$2 billion to the finance ministry’s original estimates for August exports, Tsai said.

US sanctions drive up Huawei handset prices as company grapples with impending chip shortage

The outlook for Taiwan’s exports will remain solid as more high-end production is brought back to the island, according to Australia & New Zealand (ANZ) Banking Group’s Greater China chief economist Raymond Yeung, the most accurate economist in Bloomberg’s survey.

Exports to China including Hong Kong, Taiwan’s biggest trading partner, rose 22.9 per cent even as Chinese imports unexpectedly fell last month. That was the biggest gain since February. Shipments to the US rose 13.8 per cent.

Taiwan’s export recovery is coinciding with a rebound in manufacturing sentiment. The purchasing managers’ index for August rose to 52.2, the strongest level in two years. September exports are likely to rise between 1.5 per cent and 4.5 per cent year on year, according to the finance ministry.

“Headline growth may start to come down as the Christmas holiday approaches,” ANZ’s Yeung said via email. “The trade cycle is often tied to Apple’s new model. Typically, exports outperform in the third quarter.”

Relentless global demand for 5G-related applications, including infrastructure and smartphones, is poised to keep electronics production humming. Production of computers and integrated circuits climbed by double digits in July.