TAIPEI (Reuters) - Taiwan’s export orders rose for a 13th straight month but at a slower pace in August, a boon for the region’s tech-manufacturing economies riding the surge in global demand for electronics products.
Strong exports of chips and other tech devices will set the export-driven economy up for a strong year-end and help Taiwan meet its bumped-up growth forecast of 2.11 percent this year. The solid outlook will also give the central bank leeway to stand pat on interest rates at its policy review on Thursday.
Export orders in August jumped 7.5 percent from a year earlier, government data showed on Wednesday, slower than the 8.5 percent median estimate in a Reuters poll and 10.5 percent in July. Total export order value for August was $40.8 billion.
The economics ministry said it expects September export orders to grow in the range of 1.3 to 3.6 percent, and total $43.5 billion to $44.5 billion, due to the deferred launches of some new smartphone models, Lin Li-chen, director of the ministry’s statistics department, told a news conference.
“This year’s situation is not quite the same compared to the past where there was one main smartphone model type...It is related to the effect of the iPhone models,” Lin added.
Taiwan’s export orders are a leading indicator of demand for Asia’s exports and for hi-tech gadgets such as Apple’s new iPhone 8 and iPhone X, whose models will be launched in September and November, respectively.
While both the iPhone 8 and 8 Plus will be available in September, the premium iPhone X won’t be launched until November, slightly later than some expectations.
The product launches are likely to keep manufacturers busy well into the fourth quarter, as orders typically lead actual shipments by two to three months.
Taiwan’s near-term outlook for electronics exports will largely depend on Apple’s supply chain pattern of production and shipments, DBS said in a research note ahead of the data.
Last week, Apple announced three new iPhone models, including the iPhone 8 and 8 Plus, and a premium version iPhone X which includes OLED screen and facial recognition technology.
“The implications for Taiwan are that electronics exports will still enter a seasonal upturn from 3Q onwards, similar as in the previous years. But a strong rise may only emerge in 4Q when the mass production of iPhone X kicks in,” DBS said in its note.
DBS said demand for electronics components could remain buoyant well into the first half of 2018, due to belated support from the iPhone X.
Orders from Taiwan’s two biggest markets showed a mixed picture. While August export orders from China grew 11.6 percent on year, faster than 10.7 percent the previous month, they fell 0.8 percent from the United States versus 7.7 percent growth in July.
For 2017, U.S. export orders are still expected to be the biggest in volume terms, as many communications products orders come from the United States and Europe, particularly Apple orders, Lin said.
Export orders leapt 21.3 percent from Europe and rose 13 percent from Japan.
Earlier on Thursday, Japan reported its strongest export growth in nearly 4 years on booming global demand for its cars and electronics.