Machinery Exports Out of Taiwan Grow 2.8% in 2008

Taiwan exported US$16.633 billion of machinery in 2008, for a moderate 2.8% growth year-on-year from US$16.175 billion, according to the Taiwan Association of Machinery Industry (TAMI). Despite the slight growth, the industry saw continued decline in exports in the last two months of 2008 due to the global recession.

The TAMI's tallies show that Taiwan's exports of machinery amounted to US$1.259 billion and US$1.095 billion in November and December last year, down 7.7% and an amazing 30.8% respectively.

Machine Tool Leads Export

In terms of export categories, machine tools led with export value reaching US$3.721 billion in 2008, up 5.9% year-on-year. The second biggest category was special-purpose machinery at US$1.258 billion, up 3.7%, with the category of plastics and rubber machinery coming in third at US$1.081 billion, up 3.4% from that in 2007.

Hong Kong & China Top Buyers

In terms of export destinations, Hong Kong and China together were the biggest buyer of Taiwan-made machinery in 2008, absorbing US$4.545 billion worth of the products, down 11.4% year-on-year and accounting for 27.3% of the total exports. The second-largest buyer was the U.S. at US$2.637 billion, up 2.3% and commanding 15.9%. Japan was the island's third-biggest buyers at US$998.18 million, up 5% and accounting for 6%. The non-top-10 buyers such as South Korea, Turkey, Brazil, United Kingdom, the Netherlands, etc. collectively absorbed more than that bought by H.K. and China in 2008, just the opposite in 2007, with the top-buyer's procurement having dropped some 11% in 2008, likely impacted by the global recession.

Machinery Imports Unchanged

The TAMI's figures show that Taiwan imported US$18.45 billion of machinery in 2008, up a mere 0.1% year-on-year, which was likely due to plummeting imports late in the year: the island imported US$1.22 billion and US$1.073 billion of the products in November and December last year, down 12.6% and down a whopping 39.7% from the year earlier, respectively. The TAMI attributes such sharp declines in imports to the sluggish investment willingness in Taiwan.

The largest import category was special-purpose machinery with value amounting to US$5.072 billion, down 6.5% year-on-year and accounting for 27.5% of the total import value. TAMI vice president C.C. Wang says the imported machinery is mainly employed by such high-tech industries as 3C (computers, communications and consumer electronics) and semiconductor.

The category of machine tools was second at US$21.535 billion, down 39.9% and commanding 8.3%. The third place was pumps, compressors and fans at US$1.066 billion, up 8.4% and accounting for 5.8%.

Reliance on Japan and the U.S.

Like in the past, Taiwan relied on Japan and the United States for advanced machinery in 2008. Japan was Taiwan's top supplier by selling US$7.958 billion of machinery in 2008, up 1.8% year-on-year and accounting for 43.1% of the total imports. The U.S. ranked second with US$3.758 billion, down 19.4% and accounting for 20.4%. The third place went to Hong Kong and mainland China together with US$1.832 billion, up 25.2% and commanding 9.9%.

The TAMI estimates that the overall production value for Taiwan's machinery industry came to NT$910 billion in 2008, up 5% from a year earlier, attributing the growth to the 8%-10% annual growth in domestic demand for machinery by makers of PCB (printing circuit board), precision machinery and machinery parts.

Exports of Taiwan-made Machinery (2007-2008) by Product Unit: US$1,000
Rank	Product Category	2007	2008	Annual Change (%)
1	Machine Tools	3,513,829	3,721,503	5.9
2	Special-purpose Machinery	1,213,116	1,258,307	3.7
3	Plastics & Rubber Machinery	1,045,874	1,081,827	3.4
4	Valves & Parts	950,356	960,682	1.1
5	Pumps, compressors, Fans	860,409	904,202	5.1
6	Bearings, Gears, Ball Screws	622,755	712,305	14.4
7	Machine-tool Parts & Components	678,731	689,893	1.6
8	Woodworking Machinery	693,139	601,412	-13.2
9	Molds & Dies	513,073	537,884	4.8
10	Textile Machinery	657,649	481,336	-26.8
11	Sewing Machines	388,320	361,092	-7
12	Paper Making, Printing Machinery	279,950	252,154	-9.9
13	Leather & Shoes Making Machines	81,211	84,264	3.8
	Others	4,677,255	4,986,563	6.6
	Total	16,175,667	16,633,424	2.8
Source: Taiwan Association of Machinery Industry

Machinery Imports Into Taiwan (2007-2008) by Product Unit: US$1,000
Rank	Product Category	2007	2008	Annual Change (%)
1	Special-purpose Machinery	5,425,019	5,072,916	-6.5
2	Machine Tools	2,557,365	1,535,735	-39.9
3	Pumps, Compressors, Fans	979,397	1,061,688	8.4
4	Engines & Parts	930,786	789,663	-15.2
5	Valves & Parts	615,341	623,028	1.2
6	Plastics & Rubber Machinery	317,274	323,819	2.1
7	Textile Machinery	385,887	314,646	-18.5
	Others	7,225,103	8,729,523	20.8
	Total	18,436,172	18,451,018	0.1
Source: Taiwan Association of Machinery Industry

Export Destinations of Taiwan-made Machinery (2007-2008) Unit: US$1,000
Rank	Nations	2007	2008	Annual Change (%)
1	China + Hong Kong	5,129,283	4,545,191	-11.4
2	United States	2,578,510	2,637,312	2.3
3	Japan	950,871	998,181	5
4	Germany	541,126	651,524	20.4
5	Vietnam	546,781	633,576	15.9
6	Thailand	524,042	529,163	1
7	Indonesia	348,903	435,370	24.8
8	Malaysia	374,190	405,558	8.4
9	India	332,891	394,635	18.5
10	Italy	283,959	338,801	19.3
	Others	4,565,111	5,064,113	10.9
	Total	16,175,667	16,633,424	2.8
Source: Taiwan Association of Machinery Industry

Origins of Machinery Import Into Taiwan (2007-2008) Unit: US$1,000
Rank	Nations	2007	2008	Annual Change (%)
1	Japan	7,185,705	7,958,703	1.8
2	United States	4,664,229	3,758,088	-19.4
3	China + Hong Kong	1,464,104	1,832,754	25.2
4	Germany	1,454,060	1,732,029	19.1
5	South Korea	730,295	641,481	-12.2
6	Italy	293,918	374,440	27.4
7	Switzerland	347,343	321,004	-7.6
8	United Kingdom	265,924	304,437	14.5
9	France	161,437	141,410	-12.4
	Others	1,293,157	1,386,672	11.9
	Total	18,436,172	18,451,018	0.1
Source: Taiwan Association of Machinery Industry