Taiwan's trade surplus with China to hit record high of US$24 B. in 2003

Taipei, Dec. 1, 2003 (CENS)--Taiwan's trade surplus with mainland China is expected to hit a record high of US$24 billion this year, according to the Board of Foreign Trade (BOFT) under the Ministry of Economic Affairs.

In the first nine months of the year, Taiwan's trade surplus with the mainland accumulated to US$17.4 billion, up 12.1% from one year earlier.

In the same period the island's exports to the mainland posted an annual expansion of 18.5% to reach US$25.077 billion ; while in September alone, the export grew 14.2% year-on-year to US$3.104 billion. BOFT officials said that Taiwan's rising exports to the mainland is mainly because of the latter's strong import demand and rapid economic growth after its admission to the World Trade Organization (WTO).

In the first three quarters Taiwan's exports to the mainland accounted for 24.3% of the island's total outbound shipments, against a declined ratio of 18.5% in shipments to the U.S. This indicated that Taiwan's growing reliance on the mainland as an export outlet. However, compared to over 40% growth registered by the European Union (EU), Japan and S. Korea in their exports to the mainland in the same period, Taiwan's growth of 18.5% was relatively low and should have more room for expansion.

In the Jan-Sept. period, Taiwan's imports from the mainland totaled US$7.7 billion, up 36% from one year earlier. The annual figure for this year is expected to break the US$10 billion mark for the first time. If the imports keep growing, the mainland is very likely to become Taiwan's third largest supplier by the end of the year, next only to Japan and the U.S., market observers believed.

During the nine-month period, Taiwan's imports from the mainland accounted for 8.4% of the island's total inbound shipments. However, the percentage was still far lower than the ratios for Taiwan's imports from Japan, S. Korea, the U.S., Australia, and some European nations. The corresponding ratios stood at 19.3% and over 10% in South Korea, the U.S. and Australia.

Beer, toys, notebook computers, and wooden furniture for bedrooms and offices imported from the mainland already jumped to top imported products, even though a large portion of the imported items are believed produced by Taiwanese investors there.

Exports to Mainland China (Jan.-Sept. 2003) Unit: %
Areas	Export Growth	Export Ratio	Market Share in mainland China
Taiwan	28.5	24.3	11.7
Japan	43.8	12.0	18.0
S. Korea	48.6	17.7	10.2
U.S.	18.5	3.6	8.4
EU	46.9	4.0	-
Malaysia	21.5	6.4	3.3

Source: BOFT

Imports from Mainland China (Jan.-Sept. 2003)
Areas	Import Growth (%)	Ratio of mainland's products in import markets	Import value (US$100 M.)
Taiwan	36.1	8.4	77
Japan	21.9	19.3	539
U.S.	21.3	11.7	1,086
S. Korea	32.5	12.1	156

Source: Customs Statistics