The Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) yesterday cut its GDP growth forecast for the nation this year from the 3.55 percent it forecast in April to 2.36 percent, due to the impact of near-zero growth in the second quarter because of global economic uncertainties.
The Taipei-based think tank’s latest forecast was higher than the 1.94 percent GDP growth estimated by Academia Sinica last week.
“Although economic momentum in the second quarter was weak, our overall economic outlook for this year is not that pessimistic [compared with Academia Sinica’s forecast],” CIER president Wu Chung-shu (吳中書) told a press conference.
Wu said the nation’s exports showed a contraction in the first six months due to the impact of various global economic uncertainties led by the eurozone’s debt crisis, further dragging down the GDP growth rate and the institute’s growth forecast.
However, the nation’s overall economic momentum for this year may not be as slow as during the global financial crisis of 2008 and 2009, Wu added.
The institute forecast GDP to grow just 0.18 percent in the second quarter from a year earlier, worse than the 0.39 percent annual growth posted in the first quarter, an indication that the second quarter could be the bottom of this round of the economic cycle.
However, the economy in the second half of the year may rebound from the first half by rising 3.48 percent and 5.13 percent in the third and fourth quarters respectively, as exports recover from their slump, the institute said in its quarterly report.
The institute expects the annual growth of exports to reach 0.41 percent this year, with imports to slide 0.25 percent from a year earlier.
On the domestic demand front, private consumption is expected to rise 1.91 percent this year, while private investment may fall 2.23 percent, as most companies in Taiwan maintain a relatively conservative attitude on capital expenditure, the report said.
Since various domestic institutes have revised downward their latest forecasts for economic growth this year, it seems increasingly likely that the Directorate-General of Budget, Accounting and Statistics (DGBAS) will follow suit and may cut its full-year growth forecast next Tuesday.
In May, the DGBAS estimated the nation’s economy would grow 3.03 percent this year.
PATENTS: MediaTek Inc said it would not comment on ongoing legal cases, but does not expect the legal action by Huawei to affect its business operations Smartphone integrated chips designer MediaTek Inc (聯發科) on Friday said that a lawsuit filed by Chinese smartphone brand Huawei Technologies Co (華為) over alleged patent infringements would have little impact on its operations. In an announcement posted on the Taiwan Stock Exchange, MediaTek said that it would not comment on an ongoing legal case. However, the company said that Huawei’s legal action would have little impact on its operations. MediaTek’s statement came after China-based PRIP Research said on Thursday that Huawei filed a lawsuit with a Chinese district court claiming that MediaTek infringed on its patents. The infringement mentioned in the lawsuit likely involved
Taipei is today suspending work, classes and its US$2.4 trillion stock market as Typhoon Gaemi approaches Taiwan with strong winds and heavy rain. The nation is not conducting securities, currency or fixed income trading, statements from its stock and currency exchanges said. Authorities had yesterday issued a warning that the storm could affect people on land and canceled some ship crossings and domestic flights. Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) expects its local chipmaking fabs to maintain normal production, the company said in an e-mailed statement. The main chipmaker for Apple Inc and Nvidia Corp said it has activated routine typhoon alert
GROWTH: TSMC increased its projected revenue growth for this year to more than 25 percent, citing stronger-than-expected demand for AI devices and smartphones The Taiwan Institute of Economic Research (TIER, 台灣經濟研究院) yesterday raised its forecast for Taiwan’s GDP growth this year from 3.29 percent to 3.85 percent, as exports and private investment recovered faster than it predicted three months ago. The Taipei-based think tank also expects that Taiwan would see a 8.19 percent increase in exports this year, better than the 7.55 percent it projected in April, as US technology giants spent more money on artificial intelligence (AI) infrastructure and development. “There will be more AI servers going forward, but it remains to be seen if the momentum would extend to personal computers, smartphones and
CHANGE OF FORTUNES: Concern over a pricey valuation and the risk of tighter US curbs on chip sales to China have poured cold water on TSMC’s bullish momentum Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) shares fell the most in three months yesterday upon trading resumption, joining a global technology rout as investors dramatically soured on the promises of artificial intelligence (AI). The shares declined 5.62 percent to close at NT$924 in Taipei, dragging down the benchmark TAIEX, which fell 3.29 percent to 22,119.21 points amid a technical correction, Taiwan Stock Exchange data showed. Other chip stocks also fell, with ASE Technology Holding Co (日月光投控) plunging 9.86 percent, MediaTek Inc (聯發科) dropping 2.35 percent, Realtek Semiconductor Corp (瑞昱) falling 1.33 percent and United Microelectronics Corp (聯電) retreating 1.17 percent, while Apple