Taiwan April exports jump, outlook good but some clouds ahead

TAIWAN'S exports rose for a 22nd straight month in April, and the government said the outlook was strong due to sustained demand for chips while also warning of uncertainties cast by the war in Ukraine and China's Covid lockdowns.

Exports rose 18.8 per cent in April from a year earlier to US$41.46 billion, the Ministry of Finance said on Monday (May 9). Although the rise was less than the 21.3 per cent jump posted in March, it was still the third highest monthly figure on record.

And it beat the forecast from a Reuters survey of analysts for a 16.05 per cent rise for the month.

The ministry attributed the April growth to "continuous" strong demand for technology products, and said supply chain problems were gradually easing though raw material prices were being affected by the war in Ukraine.

Exports of electronics components rose 27.5 per cent in April to US$17.21 billion, the second highest monthly figure on record, with semiconductor exports surging 29.6 per cent from a year earlier.

Chip supplies will continue to exceed demand, and Taiwanese firms are actively investing in expanding capacity in response, the ministry said, adding it saw the island's exports rising more than 10 per cent year-on-year in the first half.

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Ministry official Beatrice Tsai said first half exports could hit a new record.

Many companies expect global chip shortages to last at least for the rest of the year, which will continue to fill Taiwanese semiconductor firms' order books.

Firms such as TSMC, the world's largest contract chip-maker, are major suppliers to Apple Inc and other global tech giants, as well as providers of chips for auto companies and lower-end consumer electronics.

United Microelectronics, a smaller competitor of TSMC's, reported on Friday that April sales surged 39.16 per cent compared with the year-earlier period.

The finance ministry however warned of uncertainty over the ongoing war in Ukraine, inflationary pressures and China's lockdowns to control the spread of Covid-19.

April exports to China, Taiwan's largest trading partner, grew an annual 10.6 per cent to US$16.34 billion, compared with a 13.4 per cent on-year rise in March, while exports to the United States were up 26.6 per cent, slower than a 36.6 per cent jump recorded the previous month.

China's export growth slowed to single digits, the weakest in almost 2 years, while imports barely changed in April as tighter and wider Covid-19 curbs halted factory production and crimped domestic demand, adding to wider economic woes.

Taiwan's April imports rose 26.7 per cent, better than economists' expectations of a 20 per cent rise, after an increase of 20.3 per cent in March.

Taiwan could see May exports increase in the range of 12 per cent to 16 per cent from a year earlier, the finance ministry said. REUTERS