Taiwan's Jan export order growth jumps to highest in nearly a year

TAIPEI: Taiwan's export orders in January grew at their fastest pace in nearly a year, exceeding expectations, on strong global tech demand and boosting the island's economic prospects this year.

January's solid performance indicates stable growth of the global economy and was boosted by a lower base last year due to the Lunar New Year holiday, the Ministry of Economic Affairs said on Thursday.

January export orders rose 19.7 percent to $43.06 billion from a year earlier, the ministry said, rising for the 18th successive month. That compared with a 16.1 percent rise forecast in a Reuters poll.

The yearly growth in January was the strongest since February last year.

The ministry sees the value of February orders possibly dropping 21-23.4 percent compared with January, as the new year fell in February this year.

Taiwan won record export orders in 2017 after orders rose 17.5 percent in December and 11.6 percent in November from a year earlier.

Export-reliant Taiwan last month raised its 2018 economic growth forecast to 2.42 percent from 2.29 percent as strong exports continued to drive economic momentum, while consumption and private investment gradually improved.

Taiwan's orders are a leading indicator of demand for Asia's exports and for hi-tech gadgets, and typically lead actual exports by two to three months.

STRONG GLOBAL DEMAND

While Taiwan's solid order growth points to continuing strength for Asian exporters thanks to strong global demand for new smartphone models and memory chips, analysts said orders will cool in the coming months.

Traditionally, the first quarter is Taiwan's weakest for exports after the holiday season in the fourth quarter.

Carl Liu, an analyst at KGI Securities, said Taiwan's annual export order growth in the first quarter could reach 10-13 percent helped by a better-than-expected recovery in the global economy.

The ministry said January's performance was boosted by growth of key products, including information communications and electronic goods.

Export orders from China rose 31 percent from a year earlier and were up 16.3 percent from the United States. Orders rose 15.3 percent from the European Union and 17.8 percent from Japan.