Taiwan's Q3 economic growth may reach 7.64%: DGBAS

Taipei, Oct. 31 (CNA) Taiwan's economy might record a 7.64 percent growth in the third quarter, 4.73 percentage points higher than the August forecast, with annual growth expected to reach 5 percent this year, the Directorate General of Budget, Accounting and Statistics (DGBAS) said on Friday.

A key factor behind the stronger-than-expected growth was the much better-than-anticipated exports, Chiang Hsin-yi (江心怡), a specialist with the DGBAS, told reporters.

Goods exports in the third quarter, measured in U.S. dollars, surpassed the August forecast by US$9.16 billion, totaling US$169.4 billion, marking a 36.5 percent year-on-year increase, Chiang said.

Triangular trade, a measure used by the DGBAS to capture the combined impact of goods and services exports on economic growth, also performed strongly, registering real growth of 30.64 percent, 6.44 percentage points above the forecast, according to Chiang.

Chiang noted that the DGBAS forecast in August was based on a conservative view, which took into account U.S. President Donald Trump's vow to impose 100 percent tariffs on imports of chips and semiconductors, and the fact that information and communications technology (ICT) products account for 70 percent of Taiwan's exports.

Despite that, Chiang said, exports in ICT industries have been exceptionally strong, due to strong AI (artificial intelligence) demand.

However, traditional industries and non-AI-related manufacturing sectors have performed poorly, a sign of uneven industrial development that warrants attention, Chiang noted.

In terms of private consumption, spending related to ICT products, as well as leisure and entertainment, has increased, she said.

In contrast, demand for cars and motorcycles remained sluggish, posting negative growth, while retail and restaurant revenues were also weak, dampening overall private consumption growth, which is estimated to have increased by 0.92 percent in real terms in the third quarter, Chiang added.

The DGBAS remained confident that Taiwan's economic growth this year would be revised upward to reach at least 5 percent, Chiang said.