People ride a motorcycle while a container ship passes by at Keelung port in northern Taiwan July 20, 2010. REUTERS/Pichi Chuang (TAIWAN – Tags: BUSINESS MARITIME)/File photo
TAIPEI – Taiwan’s export orders beat expectations in January amid robust demand for artificial intelligence applications, but the outlook remains soft as high interest rates in major Western markets and geopolitical uncertainty weigh on demand.
Export orders last month edged up 1.9 percent from a year earlier to $48.42 billion, beating a 3.6- percent decline forecast in a Reuters poll. Orders dropped 16 percent in December from a year earlier.
Orders for goods from the island, home to tech giants such as chip manufacturer TSMC, are a bellwether of global technology demand.
“The 1.9 percent on-year gain was mainly because of strong demand for new applications of high-performance computing and artificial intelligence,” the economy ministry said in a statement.
It was also due to increased stockpiling before the week-long Lunar New Year break, it added, the most important holiday in the Chinese-speaking world.
However, looking ahead, the ministry said it expects export orders in February to fall between 11 percent and 15.7 percent from a year earlier. The first part of the year is traditionally the low season for orders for Taiwan’s high-tech goods.
Weak demand
The ministry cited risks ahead including the impact of high interest rates in the United States and Europe, China-U.S. trade disputes and broader geopolitical uncertainty.
Weak demand for Taiwan’s technology products amid global economic uncertainty saw the export-dependent economy grow at its slowest pace in 14 years in 2023.
Taiwan’s orders in January for telecommunication products slipped 19.3 percent , while electronic products gained 16.1 percent from the prior year, the ministry said.
Orders from China jumped 28 percent compared with a 3.5-percent drop in the prior month. Orders from the United States were up 2.7 percent compared with a 21.6-percent slide in December.
Orders from Europe sank 50 percent , worse than December’s 39.4 percent plunge.
From Japan, orders fell 21.2 percent last month, improving from a contraction of 30.5 percent in December.