Exports rise for 6th straight month on solid demand for AI, HPC devices

Taipei, May 8 (CNA) Taiwan's exports rose more than 4 percent from a year earlier in April, marking the sixth consecutive monthly year-on-year increase, on the back of global strong demand for emerging technologies, the Ministry of Finance (MOF) said Wednesday.

At a time when solid demand for artificial intelligence applications and high performance computing (HPC) devices offset the impact from slower demand faced by many old economy industries, the country's outbound sales rose 4.3 percent from a year earlier to US$37.48 billion after a 18.9 percent year-on-year increase in March.

However, the April exports failed to meet an earlier forecast by the MOF that indicated a range of between US$38.8 billion and US$39.9 billion, rising 8-11 percent from a year earlier.

In April, Taiwan's imports hit US$31.02 billion, up 6.6 percent from a year earlier with a trade surplus of US$6.46 billion, down 5.4 percent from a year earlier, the MOF data indicated.

In the first four months of this year, Taiwan's exports totaled US$147.81 billion, up 10.6 percent from a year earlier, and imports reached US$122.39 billion, up 3.8 percent, while the trade surplus soared 61.0 percent year-on-year to US$9.63 billion.

Speaking with reporters, Beatrice Tsai (蔡美娜), director-general of the MOF's Department of Statistics, said the lower-than-expected exports for April showed the uneven recovery of the global economy, with the high-tech sector benefiting from the increasing popularity of AI and HPC applications, while old economy industries continued to face demand weakness.

The old economy sector also faces rising competition on global markets due to an increase in supplies from foreign exporters, Tsai said.

In April, the information communications and video/audio industry posted US$11.74 billion in outbound sales, surging 114.6 percent from a year earlier, largely due to business opportunities created by AI applications, Tsai added.

AI development has boosted shipments of Taiwan-made AI servers and graphics cards, she said.

In addition, the industry, which accounted for 31.3 percent of Taiwan's total exports in April, also benefited from global supply chain restructuring, which has led many Taiwanese investors to relocate production to Taiwan, according to Tsai.

However, exports generated by the electronic components industry fell 17.7 percent from a year earlier to US$12.95 billion in April, accounting for 34.5 percent of the country's total outbound sales.

In the electronic components industry, the MOF said, although demand for high-end chips for emerging technology use remains strong, the smartphone and automotive IC markets are still fragile, which pushed down exports from integrated circuit suppliers by 18.8 percent from a year earlier to US$11.98 billion in April.

Meanwhile, with the restructuring of the global supply chain, the MOF said, sales previously categorized as exports now belong to domestic sales, which dragged down outbound sales in the electronic components industry.

The MOF said a move by the ministry to recategorize products under international standards by assigning parts of items to other industries continued to affect the optoelectronics and precision equipment industry, which posted US$831 million in exports in April, down 33.5 percent from a year earlier.

Major old economy industries continued to feel the pinch resulting from weak demand from end-users, the MOF said.

In April, the base metal, machinery, plastics/rubber and chemical product industries recorded US$2.25 billion, US$1.85 billion, US$1.55 billion and US$1.47 billion in outbound sales, respectively, down 10.2 percent, 13.1 percent, 8.2 percent and 3.2 percent from a year earlier.

In addition, exports generated by the electric machinery, transportation and mineral industries also fell 10.7 percent, 20.0 percent and 27.9 percent, respectively, to US$1.02 billion, US$833 million and US$858 million in April.

In April, China and Hong Kong remained the largest buyer of Taiwan's goods after purchasing US$11.30 billion worth of merchandise in April, down 11.3 percent, due to weak domestic demand in China and escalating trade tensions between Beijing and Washington, the MOF said.

On the back of strong demand for information communications gadgets, Taiwan's exports to the United States soared 81.6 percent from a year earlier to US$10.16 billion in April, the MOF added.

Exports to the Association of Southeast Asian Nations (ASEAN) bloc rose 2.8 percent from a year earlier to US$6.54 billion, while exports to Europe and Japan fell 6.5 percent and 39.6 percent, respectively, from a year earlier to US$3.27 billion and US$1.93 billion in April.

The ministry attributed the plunge in exports to Japan to a relatively high compassion base over the same period of last year, as well as a decline in electronic component shipments.

Looking ahead, the MOF said Taiwan's exports in May are forecast to grow 7-10 percent from a year earlier to US$38.7 billion-US$39.7 billion on continued strong demand for high tech devices, marking the seventh straight monthly year-on-year increase.

However, high interest rates globally, geopolitical unease and continued competition between the U.S. and China are expected to create uncertainties in the global economy down the road, the MOF said.