Taiwan's Manufacturing Turnover for H1, 2014 up 3.8% YoY

With the US Fed Reserve delaying QE for some time to allay jitters in global markets, the new Indian prime minister promising to reform labor structure to boost its own economy, coupled with sub-US$85 per barrel oil prices and China pumping new liquidity into its economy, global economic prospects are brightening to help drive growth of manufacturing in Taiwan, the overall turnover of  the island's manufacturing industries for H1, 2014, totaled NT$12.95 trillion (US$431.67 billion), up 3.8% year-on-year (YoY), according to the report on investment and performance of manufacturing by Taiwan's Ministry of Economic Affairs (MOEA).

The report indicates, among other manufacturing sectors, the base metal sector saw turnover show the strongest growth of 7.3%, followed by that of electronic parts and components with a 6.9% increase, during the period.

Meanwhile, the metal product and machinery sector finished H1 with turnover of over NT$2.5 trillion (US$83.33 billion) for a 6.7% YoY increase, thanks to a few  factors, including international price hikes of nickel that help drive domestic steelmakers' sales of stainless steel as result; brisk global demand for fasteners and machine tools; less periodic maintenance of furnaces and production equipment by local manufacturers during the period; and the persistently increasing car production and sales worldwide.

The information technology and consumer electronics sector witnessed turnover near NT$6.5 trillion (US$21.67 billion), soaring 3.8% YoY, to which the MOEA attributes promotion of 4G communication, explosively growing global demand for low-to-middle-end smartphones and development of wearable electronics. Under the scenario, domestic production of semiconductors, wafers, solar cells, LEDs for backlights, lighting and automotive had steadily increased during H1.

While overall turnover rose, Taiwanese manufacturing industries' total spending on fixed assets declined 9.2% YoY in H1 to indicate a persistent downturn for two straight quarters, to which the MOEA attributes mainly a high base.

In Q2, the electronic parts and component sector totally spent NT$146.1 billion (US$4.87 billion) on fixed assets to lead  other manufacturing sectors, but still lagged by 14.2% than a year ago. The sectors of chemicals and base metals spent NT$20 billion (US$666.67 million) and NT$9 billion (US$300 million) to rank No.2 and No.3, according to the  report. (SC)