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.
UNION DETERMINATION: Rejecting an offer for a one-time payout as an attempt to influence opinion, the union said a strike at the memory chip manufacturer is possible The Micron Taiwan workers’ union yesterday rejected a one-time payout unveiled by US-based Micron Technology Inc last week, saying it wants a long-term mechanism under which employees would share 15 percent of the company’s operating profits. While the union and the company are still in talks over the dispute, the reward package was proposed unilaterally by the employer without reaching an agreement with the union, union head Jerry Lin (林哲瑞) told reporters. Lin said he suspected the company was seeking to influence public opinion with the move. On Friday last week, Micron announced a reward package under which employees in Taiwan would receive
MINIMAL EXPECTATIONS: Analysts think that the two sides are likely to aim for ‘status quo’-level agreements, maintaining civility, without major trade breakthroughs US Secretary of the Treasury Scott Bessent and Chinese Vice Premier He Lifeng (何立峰) were set to meet yesterday to try to set up potential agreements on artificial intelligence (AI), tariffs and critical minerals for a summit in Washington this week between US President Donald Trump and Chinese President Xi Jinping (習近平). The meetings at JPMorgan Chase & Co’s headquarters in Manhattan, which included US Trade Representative Jamieson Greer, were due to start at about 10:30am on Sunday morning and were expected to run all day. Key topics would be the status of a US-China trade truce that is set to expire
BUILDER’s RITES: The topping out ceremony is held when a project being built has its highest point laid out, a sure sign that TSMC’s European project is making solid progress A “topping out” ceremony was held on Monday at a plant under construction in Germany by Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), indicating that the fab is progressing as planned and within budget, the head of a joint-venture company in charge of the project said. A topping out ceremony is the construction milestone of laying the final beam or structural piece at the highest point of a building, and it honors the construction crew, architects and engineers. European Semiconductor Manufacturing Co (ESMC) president Christian Koitzsch said that about 2,000 workers from 106 countries are working around the clock at the site in
APPEAL: Any agreement to produce advanced memory such as HBM or DRAM could run into opposition from Seoul as those technologies are sensitive, sources said South Korea’s SK Hynix Inc is in talks with Intel Corp about a deal that would see it manufacture memory chips on US soil for the first time, three people familiar with the discussions said. Under one potential scenario, SK Hynix would lease part of Intel’s long-planned chipmaking facility in Ohio, they said. Under another scenario, it could form a venture with Intel and major cloud firms that are keen to lock in memory supplies, two of the people said. A deal would relieve pressure on Intel, which has been struggling, and mark a big win for US President Donald
RSS