Taiwan: Merchandise exports slide in December
Merchandise exports plummeted 12.1% annually in December, on the heels of Novembers 13.1% drop. All key export sectors registered declines in December, including the electronics and IT sectors. Exports to China fell at a particularly sharp pace, amid the mainlands large Covid-19 outbreak. Shipments to other overseas markets also declined, albeit at softer rates. Meanwhile, merchandise imports plummeted 11.4% over the same month last year in December (November: -8.6% yoy), marking the weakest reading since January 2020.
As a result, the merchandise trade balance improved from the previous month, recording a USD 4.8 billion surplus in December (November 2022: USD 3.4 billion surplus; December 2021: USD 5.7 billion surplus). Lastly, the trend deteriorated, with the 12-month trailing merchandise trade balance recording a USD 51.9 billion surplus in December, compared to the USD 52.9 billion surplus in November.
Exports are likely to remain downbeat in the near term as momentum eases in the developed world and economic activity in China is disrupted by the pandemic. However, sustained global demand for advanced technology such as 5G will aid semiconductor exports to an extent. In addition, the Chinese governments shift towards living with Covid-19, together with an eventual rebound in the U.S. and Europe, will support exports in H2 2023.