Taiwan Sees Drop in Export Order Value in January

Influenced by the sluggish first-month business climate and slow economic recovery in Europe, the value of export orders received by Taiwan's manufacturers and traders suffered a drop of 2.8% on an annual basis in January, to a seven-month low of US$36.11 billion, according to statistics released by the Ministry of Economic Affairs (MOEA).

Earlier, the MOEA had optimistically predicted that the value of export orders received this January would total over US$40 billion, following a record monthly high in December. In response to the January disappointment the MOEA has adopted a conservative attitude toward the export performance in February, predicting that orders received during the month will fall below US$30 billion.

L. C. Lin, director of the MOEA's Statistics Department, attributes the January decline to the fact that the Chinese New Year holidays fell during that month, shortening its working days. The sluggish business resulting from extremely cold weather in Europe and the United States also influenced Taiwan's export orders.

The growth in orders for ICT (information and communication technology) products in January was a marginal 0.6% year-on-year (YoY), tumbling by almost 13 percentage points from 13.5% seen in the previous month. Orders for basic metals, chemicals, plastic and rubber products, and machines all fell in comparison with January 2013.

January racked up a negative growth in orders from mainland China, the United States, and six ASEAN (Association of Southeast Asian Nations) members: Indonesia, Malaysia, the Philippines, Singapore, Thailand, and Vietnam. Orders from Europe and Japan, however, showed positive growth.

January orders from mainland China fell 3.9% on an annual basis and 11.2% on a monthly basis to US$9.02 billion, a seven-month low. Lin explains that manufacturers in mainland China seem to be reducing their dependence on key parts from Taiwan as they build up their own supply chains, particularly in the ICT industry. The result was a 20.9% drop in orders for ICT products from the mainland in January. (JL)

Major Orders from Mainland China in January
Product Category	Order value (US$B)	Annual Growth (%)
Electronic Products	2.97	8.5
Precision Devices	1.56	-6.1
Chemicals	0.97	0.8
Plastic & Rubber Items	0.68	-10.7
ICT Products	0.64	-20.9

Source: MOEA