Overall Output of Taiwan's Manufacturing Sectors Expected to Grow in 2018

Feb 09, 2018 Ι Industry News Ι Auto Parts and Accessories Ι By Alan Lu, CENS
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As Taiwan's Industrial Production Index for 2017 just showed the strongest year-on-year (YoY) growth of 2.9 percent ever in history, Ministry of Economic Affairs (MOEA) expects overall output of the island's manufacturing sectors to continue to grow this year.

MOEA's statistics department reported, Industrial Production Index of Taiwan last December reached 113.42, up 1.2 percent from a year ago as the second highest monthly record for the entire year; while production index of the local manufacturing industry also edged up by 0.93 percent YoY to 114.94.

Noteworthily, Industrial Production Index and a production index of the manufacturing industry for the whole year stood at 109.63 and 111.72, respectively, rising 2.9 percent and 3.74 percent YoY, both the sharpest increases in the past three years.

Wang Su-juan, deputy director of the statistics department noted that last December, combined output of machine tools, electronics, semiconductor production equipment, ball screws and linear guide, surged by 7.47 percent YoY mainly on growing demands for intelligent manufacturing equipment.

Fueled by the continued growth momentum, the statistic department pointed out that the manufacturing production index this January is expected to have posted a 5 percent compared to last January.

In the meantime, driven by the broadening application of intelligent manufacturing technologies, market demands for electronic components like IC packaging, printed circuit boards (PCBs), and flash memory products have continuously increased as well. However, as local LED chip and 12-inch wafer manufacturers have tended to churn out higher-end products in exchange for better margins rather than higher output, the YoY growth of overall production volume by the sector for last year was offset to only a 0.9 percent.

Benefiting from the continuously rising of international raw material prices, the local chemical industry and base metal industry enjoyed a 2.16 percent and 2.94 percent, respectively, in output.

On another front, production volume by local auto parts makers decreased by 2.09 percent last year from a year earlier, primarily because local carmakers were forced to cut output in response to the encroachment of imported cars on sales of locally assembled vehicles in the domestic market, as well as adequate inventory levels held by distributors and agents.

As to outlooks in the first quarter of this year, MOEA officials stressed that Taiwan's manufacturing sectors are likely to remain on an uptrend, based on IMF's global economic growth forecast for 2018, which has been adjusted upward to 3.9 percent, a percentage point of 0.2 higher than 3.7 percent for 2018. Another positive factor among others is the recent passage of the so-called Forward-looking Infrastructure Development Program by the Taiwanese government, which is expected to help further sustain local manufacturing sectors this year once put into action.
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