The government’s business climate monitor showed that the economy floundered in slowdown mode last month as the COVID-19 pandemic continued to weigh on wholesale and retail business, manufacturing-sector sales and corporate sentiment, the National Development Council (NDC) said yesterday.
“The pace of the slowdown in Taiwan is easing, but uncertainty is building abroad due to a surge in global confirmed cases and therefore bleaker outlooks for the world’s economy from international research institutes,” NDC research director Wu Ming-huei (吳明蕙) said, citing the IMF as an example.
Taiwan cannot afford to let its guard down, and must closely watch the pandemic and US-China trade tensions, the two largest downside risks in the second half of the year, Wu said.
The overall monitor shed 1 point from a month earlier to 18, reading “yellow-blue” — which indicates a sluggish economic state — for the third straight month.
The council uses a five-color system to portray the state of the nation’s economy, with “green” indicating steady growth, “red” suggesting a boom and “blue” signaling a recession. Dual colors indicate a transition.
Of the nine components measured, only the narrow M1B money supply gauge — cash and cash equivalents — as well as industrial production and share closing prices registered positive movements, the council said.
The leading indicator series, which aims to predict the economic scene in the coming six months, shrank 0.77 percent to 97.45, falling for the seventh consecutive month with a cumulative retreat of 5.46 percent, the council said.
The decline is tapering off, meaning the bite of the pandemic is losing steam, Wu said.
Export orders, a gauge of actual exports in the next one to three months, returned to positive territory, due to robust demand for 5G and remote learning and working arrangements, the council said.
Construction floor space, imports of semiconductor equipment and labor accession rates have not improved, it said.
The index of coincident indicators, which reflect the current economic situation, dropped 1.05 percent to 97.63, the council said.
Readings on total electricity utilization, non-farm payroll, as well as food and beverage sales, registered negative cyclical movements, it said.
Coincident indices might improve from this month, as people regained confidence regarding shopping, domestic tours and social gatherings after local infections stabilized, Wu said.
The distribution of stimulus vouchers next month would lend further support to consumer activity, she said.
Already, the just-concluded Dragon Boat Festival holiday weekend saw a solid increase in domestic travel and spending, Wu said.
However, Taiwan cannot stay above a global downturn, she said.
The government is closely monitoring the international situation and would take necessary steps to meet challenges, she added.
EQUAL SHARE: A row over Micron’s payouts coincides with a global debate about who deserves a cut of the sudden wealth generated by the artificial intelligence boom Micron Technology Inc is to provide its engineers in Taiwan a cash bonus of NT$1 million (US$31,600) plus equity rewards, as the company’s local unions are demanding an additional payout to reflect their contribution to the chipmaker’s blowout profits. The Idaho-based chipmaker said in a statement yesterday that its entry-level, Taiwan-based engineers’ average compensation would reach NT$3.4 million for the past fiscal year after the cash and equities awards. All employees in Taiwan would receive equities as part of the annual merit grants, the company added. Before the announcement, Micron’s unions asked for a one-time cash payout equal to about seven years
UNDER PRESSURE: Samsung taunted Apple with sarcastic posts on X during its launch, saying ‘reheating our leftovers,’ and ‘so far, so same’ Samsung Electronics Co launched a publicity campaign for its foldable phones, touting its hardware advantage and its early entry into the segment as it seeks to fend off a major challenge from Apple Inc. Apple on Wednesday unveiled the Duo, a folding US$1,999 iPhone aimed at shaking up a category long dominated by Samsung and Chinese companies such as Huawei Technologies Co (華為), whose devices have struggled to move beyond a niche audience. Apple adopted the passport-shaped design that Samsung Electronics unveiled less than two months ago with the Galaxy Z Fold 8, priced at US$1,899 and powered by Alphabet Inc’s Gemini
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
SOME CUSHION: Taiwan’s GDP is forecast to grow more than 11 percent this year, so the economy should be able to absorb the impact of a rate hike, an expert said With domestic inflation topping the 2 percent alert level for a fourth consecutive month last month and several major central banks around the world raising their key interest rates, Taiwan’s central bank is facing growing pressure to raise rates at its quarterly policymaking meeting on Thursday, economists said. At its June meeting, the central bank left interest rates unchanged for the ninth consecutive quarter, with the discount rate at 2 percent. Central Bank Governor Yang Chin-long (楊金龍) had said that the bank maintained a somewhat hawkish stance, with two board directors voicing support for a rate hike at the meeting. Cathay United
RSS