The export orders from Taiwan have shrunk for an 8th consecutive month in June, with global firms more and more reluctant to make new investments in machinery as the trade war between the two giant countries i.e. China & the United States continues.
According to the yesterday’s data, there was a sharp decline in export orders from China & Japan as compared with the last month, and shrinkage from Europe, even though United States demand for Taiwan products increased for the first time in months, mainly due to supply chain adjustments.
When combined with a steep decline in the preliminary exports of South Korea reported earlier in the day, the readings indicate further tensions on Asia’s trade-reliant economies in the upcoming months, in particular to those which are highly dependent on sales of high-technology memory chips and electronics.
There was a drop of 4.5 percent in the orders in June year-on-year of $38.5 billion, data from Taiwan’s Ministry of Economic Affairs revealed.
The ministry is expecting July export orders to further decrease 6.7-9.1 percent on-year.
It was stated by the ministry that affected by the trade spat between the US-China, the global economy is unstiffening and clients give their orders with a hesitant and conservative approach.
Global orders for machinery saw the greatest drop, decreasing 22.3 percent while electronics fell 4.3 percent even though telecom products rose.
But, the ministry stated that orders could improve in the 2nd half, due to the rising demand for the 5th-generation telecommunications (5G) technology & as retailers prepare for the highest year-end shopping season when major vendors of the smartphone are ready to launch new products.
The major suppliers for global technology heavyweights like Qualcomm & Apple Inc. are Taiwan’s high-tech factories, and the persistent drop in orders proposes global electronics could remain soft for some time.