Taiwan's export orders plunge

Taiwan relies on electronic exports to the US

Taiwan's export orders and industrial output plunged steeply in September, suffering twin blows from typhoons and terrorist attacks on the US.

Taiwan's economy depends heavily on electronics exports to the US, the island's biggest export market, and its economy was reeling under the impact of the US economic slowdown before 11 September.

People know the third and fourth quarters will be bad, but probably won't get worse

Daniel Chen, Industrial Bank of Taiwan

Both exports and industrial output have fallen throughout the year, except for a brief seasonal rise in February.

The latest data are thought to be the worst September figures ever.

The falls are in sharp contrast to double-digit growth in both exports and industrial output a year earlier, in September 2000.

Counting the cost

Taiwan's Ministry of Economic Affairs estimated that the turmoil following the terrorist attacks on the US cost the island at least $1.5bn in lost orders.

Meanwhile, typhoons Nari and Lekima temporarily halted production across Taiwan, further cramping September's industrial output.

But economists were braced for bad news, and the figures were not quite as dire as many had feared.

"The numbers are a little better (than expected)," said Daniel Chen, chief economist at Industrial Bank of Taiwan.

"People know the third and fourth quarters will be bad, but probably won't get worse."

Poor outlook

However, October's figures are likely be similarly bleak, economists said.

October's export orders are expected to "continue a double-digit decline between 15% and 20%", according to Hermes Yang, an economist with Chung Hsing Securities.

Taiwan's export orders fell to $10.5bn last month, one quarter down on September 2000, and 8.13% lower than in August, the Ministry of Economic Affairs said.

Exports to the US were 14.4% lower last month than in August.

Electronics orders

Total exports for the crucial electronics sector slumped 40.2% from September last year to $2.11bn, while orders for information and telecoms goods fell by more than one third to $1.72bn.

Industrial output was 14.1% below its September 2000 level, with the information and electronics sector recording the biggest fall, of 20.9%.

Industrial output had shrunk 7.86% from August.

Earlier this month, figures for Taiwan's actual exports in September revealed they dived by 42.5%.