TAIPEI: Taiwan's economic growth likely slowed in the first three months of 2018 given some softening in global demand for technology goods that has been a bright spot for its trade-reliant economy.
The median forecast in a Reuters poll of 16 economists was for first quarter gross domestic product to expand 2.84 percent versus a 3.28 percent growth pace in the fourth quarter - the fastest quarterly growth in nearly three years.
The government nudged up its full-year 2018 growth to 2.42 percent in February from 2.29 percent forecast in November, but mixed data from key markets recently has raised questions about whether the strong tech exports that fuelled 2017 expansion can be sustained.
Some economists are questioning the economy's ability to maintain its vigor, given indications that the electronics cycle is peaking.
"Taiwan is a small open economy that focuses on production of parts of smart-devices. If production reaches a peak, it would be difficult for the rest of the economy to make up the loss of growth," said Iris Pang, an economist with ING Wholesale Banking.
The island's export orders rebounded in March but signalled some weakening in global demand even as manufacturers worry about growing trade protectionism.
Taiwan Semiconductor Manufacturing Co Ltd, the world's largest contract chipmaker, trimmed its full-year revenue target last week on softer demand for smartphones, sending its shares and other Apple Inc supplier stocks tumbling.
Other sectors of Taiwan's economy are also unlikely to make up for the slowdown in electronics exports in the coming months, some analysts have said.
"We are cautious about the prospect of services cushioning an export slowdown. Taiwan remains export-oriented. Domestic demand remains stable. At current levels, it will likely lack the drive to support growth further," said Jeff Ng, economist at Continuum Economics.
Taiwan's preliminary figures will be released on Friday in a statement with minimal commentary. Revised figures will be published two to three weeks later with more details and forward-looking forecasts.
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