Taiwan’s economy might expand 3.1 percent next year, faster than the 1.1 percent growth estimated for this year, as inventory adjustments would end this quarter, allowing restocking demand to increase, Standard Chartered Bank Taiwan said yesterday.
Demand for consumer electronics might return to growth next year following several quarters of downcycles induced by sharp global inflation and monetary tightening, Standard Chartered senior economist Tony Phoo (符銘財) told a media briefing in Taipei.
That would benefit local firms in supply chains for such products, Phoo said.
Photo, Lam Yik Fei, Bloomberg
Business in the US, Europe and Japan has showed signs of improving after global inflation eased and major central banks halted rate hikes, he said, adding that these factors would facilitate a resumption in growth for Taiwan’s exports next year, while private investment would stop being a drag.
Semiconductor shipments have accounted for 38.7 percent of Taiwan’s exports so far this year, thanks to fast-growing global demand for advanced chips, Ministry of Finance data showed.
China, Taiwan’s largest export destination, is expected to report a better economic performance next year, as Beijing is likely to roll out more measures to support its infrastructure and property sector, Phoo said.
Chinese tourists would contribute to Taiwan’s tourism sector if the two sides allow greater civilian exchanges after Taiwan’s presidential election next month, he said.
Taiwan’s consumer prices might increase 2.2 percent year-on-year this year, but grow 1.5 percent next year, which would give the central bank reason to leave policy rates intact at its quarterly board meeting tomorrow, he said.
The domestic property market would also come out of the woods next year after dodging a hard landing this year, Phoo said.
The property market’s resilience has much to do with relatively low borrowing costs and prudent financial planning by homebuyers, he said.
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