Taiwan's economy remains stable on improving exports, production

Taipei, March 28 (CNA) Taiwan's overall economy remained stable for the second consecutive month in February on the back of improving outbound shipments and industrial production, the National Development Council (NDC) said Wednesday.

Data released by the NDC, the top economic planning agency in Taiwan, showed the composite index of monitoring indicators rose two points from a month earlier to 29, placing it in the "green" range, the same as in January.

The NDC uses a five-color system to gauge the country's economic performance, with blue indicating economic contraction, yellow-blue representing sluggishness, green signifying stable growth, yellow-red referring to a warming economy, and red pointing to an overheated or booming economy.

Among the nine factors in the composite index of economic indicators, the subindex on industrial production moved higher by two points to sit in the yellow-red range in February, compared with yellow-blue a month earlier, the NDC said.

The subindex for average monthly overtime hours of the industrial and service sectors also rose one point from a month earlier to sit in the yellow-red range in February, while the subindex for customs-cleared exports rose two points to red.

Furthermore, the subindex for money supply dropped by one point to blue, while sales posted by the retail, wholesale and food/beverage industries dropped by two points to yellow-blue, the NDC added.

The other four factors -- share price changes (red), imports of machinery and electric equipment (yellow-blue), producer's shipment for manufacturing (green), and TIER manufacturing sector (green) -- remained unchanged from a month earlier.

The expansion of emerging technology applications such as artificial intelligence and replenishing inventories in some industries helped drive production and exports, the NDC explained, adding that the improving February indicators show the domestic economy continues to recover.

Wu Ming-hui (吳明蕙), head of the NDC's Department of Economic Development, said the January and February data show signs of an improving economy.

However, concerning Taiwan's sluggish machinery and electric equipment imports, Wu said this was due to domestic manufacturers becoming cautious over their purchases as the recovery of many advanced economies begins to slow down while their purchasing managers' indexes are under contraction due to weak demand.

As local semiconductor makers and major international firms continue to invest more in Taiwan, coupled with companies promoting net-zero initiatives and improvement in R&D, this will help Taiwan maintain its investment momentum, Wu said.

In terms of outlook, the department director said she was confident about the results of the composite index of monitoring indicators in March, as the domestic manufacturing business climate has been rising for three consecutive months, and also because the Consumer Confidence Index released by National Central University on Wednesday showed an upward trend.