Taiwan's export market to slow in second half of 2025 due to U.S. tariffs

Taipei, July 22 (CNA) Taiwan is expected to see slower growth in export orders in the second half of 2025, following a strong performance in the first six months, ahead of U.S. tariff hikes, the Ministry of Economic Affairs said on Tuesday.

While the export-oriented country will likely continue to benefit from exporting to overseas markets, July export orders are forecast to range between US$54 billion and US$56 billion -- a year-on-year increase of 7.9 to 11.9 percent -- according to Huang Wei-jie (黃偉傑), head of the ministry's statistics department.

That projection, though still positive, marks a sharp contrast with the first half of the year, during which Taiwan recorded a higher year-on-year growth of more than 15 percent in four out of six months.

In January and March, Taiwan saw a 3 percent year-on-year decline and a 12.5 percent increase, respectively, while the remaining months posted strong growth ranging from 18.5 to 31.1 percent.

Citing industry feedback, Huang attributed the robust demand in the first two quarters to pull-in momentum driven by the "reciprocal tariffs" announced by U.S. President Donald Trump in April, though the measures were delayed until August.

"Some companies said the momentum has faded, while others told us it's still continuing," Huang said.

On Tuesday, the ministry also released Taiwan's June export order data, showing the second-highest June figure on record thanks to sustained global demand for artificial intelligence (AI) applications.

Taiwan booked US$56.77 billion in export orders in June, a 24.6 percent increase from the US$45.56 billion recorded in the same month last year.

It marked the fifth consecutive month of year-on-year growth, following a record-breaking May that saw orders reach US$57.93 billion.

The country posted export orders worth US$171.1 billion in the second quarter and US$320.6 billion in the first half, up 20.9 percent and 16.6 percent year-on-year, respectively, the ministry said.

According to ministry data, the product rankings remained unchanged, with AI and cloud-related demand driving orders for information and communication products -- such as servers, networking devices, and graphics cards -- to US$17.51 billion, up 37.4 percent from a year ago.

That the figures beat projections made a month earlier was "beyond expectation," Huang noted, adding that demand for AI-related products appears impervious to the pending U.S. tariffs.

Meanwhile, Vice Premier Cheng Li-chiun (鄭麗君) is set to depart for the U.S. for a fourth round of negotiations over the tariffs this week, amid rumors that the proposed rate has already been set at 32 percent -- a claim the government has denied.

Also in June, export orders for electronic products such as semiconductors and printed circuit boards reached US$20.98 billion, up 35 percent year-on-year.

By contrast, traditional industries continued to struggle. Orders for rubber and plastic products fell 11.4 percent, while basic metals declined 10.2 percent.

Looking ahead, Huang said another round of momentum could boost consumer electronics orders in August, as mobile phone brands typically unveil new models around that time.

Still, the outlook will largely depend on the outcome of U.S. tariff decisions, "be it better or worse," he added.