Taiwan's industrial production up for 18th straight month on AI support

Taipei, Sept. 24 (CNA) Taiwan's industrial production rose more than 14 percent from a year earlier in August, marking the 18th consecutive month of year-on-year growth, as strong global demand for artificial intelligence applications continued to support the export-oriented manufacturing sector, the Ministry of Economic Affairs (MOEA) said Wednesday.

Data compiled by the MOEA showed the industrial production index rose 14.41 percent from a year earlier to 117.36 in August, with the subindex for the manufacturing sector, which accounts for more than 90 percent of total production, up 15.48 percent at 118.22.

The latest overall index and the manufacturing sector's subindex both hit highs for August, the MOEA said.

In the first eight months of this year, the industrial production index rose 16.59 percent from a year earlier to 108.14, while the subindex for the manufacturing sector grew 17.75 percent to 108.86.

Speaking to reporters, Chen Yu-fang (陳玉芳), deputy head of the MOEA's Department of Statistics, said Taiwan continued to benefit from growing demand for emerging technologies such as AI, high-performance computing (HPC) and cloud services, as well as the debut of new consumer electronics gadgets, which helped industrial production advance in August.

The electronics components industry enjoyed a 31.52 percent increase in production in August due to higher output from the 12-inch wafer foundry business, IC designers, IC packaging and testing service providers, and IC substrate makers amid strong demand for AI and HPC applications, the MOEA said.

Production in the computer and optoelectronics industry rose 3.80 percent from a year earlier in August, also because of AI development, which boosted production of communications devices, IC inspection equipment, and industrial computers, the MOEA said.

But a decline in exports of portable PCs and PC components offset some of that growth, the MOEA added.

The strength of industrial production in Taiwan, however, appeared uneven, with old-economy industries facing fragile global demand, Chen said.

In August, production in the base metal industry fell 0.69 percent from a year earlier due to weaker demand for steel products, while the machinery industry saw production fall 1.24 percent on a relatively high comparison base from the same period last year, reversing growth seen in recent months.

In addition to the comparison base effects, Chen said the machinery industry also felt the pinch from a 20 percent tariff imposed by the United States, effective Aug. 7.

The chemical materials and fertilizer industry posted a 1.71 percent year-on-year decline in production last month due to escalating price competition, while the auto and auto parts industry's production fell 11.95 percent on weaker orders.

The MOEA estimated the subindex for the manufacturing sector will reach 114.58-118.58 in September, up 15.0-19.0 percent from a year earlier. Chen said it is possible for the subindex to hit a new high this year on the back of growing AI applications.