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New iPhone may buoy Taiwan exports after first gain in 17 months

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A jump in orders for semiconductors ahead of the release of Apple Inc's newest iPhones helped Taiwan post the first gain in exports in nearly a year-and-a-half and may boost growth in the trade-dependent economy.

[TAIPEI] A jump in orders for semiconductors ahead of the release of Apple Inc's newest iPhones helped Taiwan post the first gain in exports in nearly a year-and-a-half and may boost growth in the trade-dependent economy.

Exports in July climbed 1.2 per cent from a year earlier, the Ministry of Finance said in Taipei late Monday, with electronic goods shipped overseas rising 5.7 per cent. A low base last July helped the overall increase, the ministry said in a statement.

Exports account for nearly two-thirds of Taiwan's gross domestic product, and a recovery in shipments would give a substantial boost to economic growth. The island reversed three quarters of GDP shrinkage in the second quarter, posting a 0.69 per cent growth rate. The statistics bureau in May forecast growth of 1.06 per cent for the full year.

The next few months mark the peak season for semiconductors and telecommunications products, according to Anita Hsu, an economist at Masterlink Securities Investment Advisory in Taipei. Ms Hsu expects exports to grow as much as 5 per cent in the third quarter, since the new iPhone's release boosts shipments.

Apple could introduce new models - the 6S and 6S Plus - as early as next month, with more advanced photography capabilities and upgraded hardware, according to people familiar with the matter. The Cupertino, California-based company's biggest Taiwanese suppliers include the world's biggest contract manufacturer of microchips, Taiwan Semiconductor Manufacturing Co and iPhone assembler Hon Hai Precision Industries Co, better known as Foxconn.

The benchmark Taiex stock was little changed, while the local dollar gained 0.3 per cent to NT$31.420 per US dollar. The Taiwan dollar has risen about 5 per cent against the greenback so far this year, compared with the Chinese yuan's 2.5 per cent drop.

BLOOMBERG