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Thursday, October 23, 2003

Taiwan Sept export orders at record high $15.4 bn

Reuters
Taipei, October 23

Taiwan posted record-high export orders and firm industrial output data for
September on Thursday, making a strong start to the island's peak export
season on soaring demand for electronics from the United States and China.
The economics ministry said export orders had jumped 20.4 per cent from a
year earlier to $15.4 billion, the fastest pace of growth in a year and
double analysts' estimates.

The ministry also forecast double-digit growth in export orders in the
fourth quarter over the same period in 2002.

"The numbers are very encouraging. It is more than just the run-up to the
Christmas orders," said Lian Chia-liang, an economist for JPMorgan Chase
based in Singapore.

"You have export orders up 14 per cent q/q (quarter on quarter) in Q3.
That's a very dramatic increase," said Lian.

A Reuters poll had predicted September export orders, an indicator for
future exports, would be up 11 per cent, as an improving global economy adds
to the pre-Christmas boom.

JPMorgan is considering hiking its 2003 economic growth forecast for Taiwan
from 2.5 per cent to as high as three per cent, Lian said. The robust export
sector is Taiwan's most important driver of growth, as domestic consumption
has been slow to pick up.

The United States remained the largest source for orders for Taiwan, surging
20 per cent from a year earlier to $4.38 billion in September, the fastest
growth in three years.

"The United States is recovering and Japan is stabilised, while we head into
the traditional peak period," Chang Yaw-tzong, the ministry's chief
statistician, told reporters.

The ministry also said Taiwan's industrial output in September had been 7.5
per cent higher than a year earlier, close to expectations seen in the
Reuters poll.

MERRY CHRISTMAS

Orders from Hong Kong and China combined jumped 20.4 per cent to $3.47
billion, second only to the United States.

Thousands of Taiwan manufacturers have moved production lines to low-cost
China, but a large portion of goods shipped there are processed and
re-exported to markets such as the United States.

Electronics export orders surged 27.4 per cent to $3.33 billion last month,
making it the largest single product category. Orders for information and
telecommunications products were also strong, rising 27.2 per cent to $3.32
billion.

September, October and November are a peak export and manufacturing season
for Taiwan as demand is boosted by end-year holiday orders from major
markets in the United States, Europe and Japan.

Analysts said the economic data, combined with good corporate results,
indicate global economic growth is strengthening.

Compal Electronics Inc, the world's number-two contract maker of notebook
computers, said on Thursday it expected to ship 30 per cent more laptops in
the fourth quarter than in the previous quarter.

Compal, which supplies US giants Dell Inc and Hewlett-Packard Co, posted a
record high net profit of T$2.65 billion ($78 million) for the third
quarter.

Taiwan raised its official forecast for 2003 economic growth to 3.1 per cent
from 2.9 per cent in August, due mainly to expectations of continued
recovery in the global economy.

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