This autumn GDP contracted by 0.9% yoy (Q3: +4.0% yoy). The This autumn studying was the weakest since Q3 2009, beating market expectations for growth. The studying introduced the growth for 2022 to 2.4% general, a big slowdown from 6.5% progress in 2021.
Family spending progress slowed to 2.9% within the fourth quarter (Q3: +7.0% yoy) on a a lot much less favorable base impact. Public spending, then again, elevated by 3.1% within the fourth quarter (Q3: +2.1% yoy). Gross investments flattened out (Q3: +0.3% pa).
Exports of products and companies fell by 5.1% in This autumn (Q3: +2.8% yoy), a multi-year low. The decline was because of the disruption in China attributable to Covid-19 and slowing international expertise demand. As well as, imports of products and companies deteriorated, contracting by 1.6% within the fourth quarter (Q3: +2.3% yoy).
On a seasonally adjusted quarterly foundation, financial exercise contracted by 1.1% within the fourth quarter, in distinction to progress of 1.8% within the earlier interval.
The consensus is for the economic system to return to progress in Q1, though dangers are on the draw back given a lot weaker than anticipated This autumn numbers and weak exterior demand. The velocity of the Chinese language economic system’s restoration from the present wave of Covid-19 instances can be essential; China accounts for over 1 / 4 of Taiwan’s items exports. Stable non-public consumption and a rebound in vacationer arrivals following the easing of journey restrictions ought to assist exercise within the first quarter.
Relating to the outlook, Ho Woei Chen of United Abroad Financial institution stated:
“The contraction in overseas demand, together with semiconductors, is prone to proceed this quarter and given Taiwan’s important publicity, there may be now a danger of a technical recession in 1Q23. Nonetheless, we see additional enchancment in non-public consumption this yr and it will stay the primary driver of Taiwan’s economic system as home demand and worldwide journey proceed to recuperate.”
FocusEconomics panellists anticipate GDP progress of two.2% in 2023, unchanged from final month’s forecast, and a couple of.6% in 2024.