TAIWAN’S export orders contracted for the 13th straight month in September and missed expectations as demand remains subdued due to factors like high interest rates and the slow global economy, with the outlook hemmed in by wars, inflation and rate hikes.

Export orders last month fell 15.6 per cent from a year ago to US$51.4 billion, the Ministry of Economic Affairs said on Friday (Oct 20). Export orders for goods from the island, home to tech giants such as Taiwan Semiconductor Manufacturing Co (TSMC), are an indicator of global technology demand.

The rate of decline was almost identical to the 15.7 per cent drop in August, and trailed the 13.9 per cent fall predicted in a Reuters poll.

The ministry has repeatedly warned that demand for Taiwan’s exports may continue to be stifled in the foreseeable future by high inflation and rising interest rates, along with the global repercussions of the war between Russia and Ukraine.

The ministry said it expected export orders in October to fall by between 4.3 per cent and 7.9 per cent from a year earlier.

While the ministry said export orders will be helped by the traditional year-end holiday shopping season in Western markets, wars in Ukraine and Israel, inflation and interest rate hikes “may inhibit the momentum of global trade growth”.

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But November and December could be more positive, said Huang Yu-ling, the director of the ministry’s statistics agency, given “enthusiastic” demand from artificial intelligence companies and inventory draw-downs.

The fourth quarter may show positive growth, Huang added.

Weak demand for Taiwan’s technology products amid global economic uncertainty has prompted the government to forecast that the export-dependant economy will grow at its slowest pace in eight years in 2023.

Taiwanese companies such as TSMC are major suppliers to Apple, Nvidia and other global tech companies.

Orders in September for telecommunications products fell 19.2 per cent and electronic products dropped 16.7 per cent from a year earlier, the ministry said.

Orders from China were 1.6 per cent lower, narrowing slightly from a 2.0 per cent dip in the prior month.

Orders from the US fell 16.1 per cent, versus a 14.5 per cent drop in August.

Orders from Europe plummeted 46.5 per cent versus August’s 33.6 per cent drop. REUTERS