Taiwan’s Manufacturing Production Index Hits 12-Month High in February 2014

Taiwan’s industrial production index stood at 87.00 in February for an annual growth of 7%, with manufacturing production index up 7.59% to 88.04, a new 12-month high, according to the statistics released by the Ministry of Economic Affairs (MOEA).

China’s continuing market demand and slow economic recovery in the United States and Europe will likely drive Taiwan’s industries including semiconductor, optical components, petrochemicals, and machinery, hence making Taiwan’s manufacturing production very likely to keep rising in the first quarter of the year.

Some worry that the current severe protest by students of the Cross-Strait Agreement on Trade in Services and its delay of the signing with China may impact Taiwan’s manufacturing production, with Taiwan’s major trade rival—South Korea, to benefit from such fallout.

Taiwan and South Korea are arch-rivals in such industries as electronics, LCD panels, information technology, and telecommunications, with the former to lag further behind S. Korea in global competitiveness without signing as many free trade agreements with trade partners.

In the first two months Taiwan’s manufacturing production index rose 2.32% year on year due mainly to expanding production of semiconductor, LED, solar energy, petrochemicals, and iron & steel.

In the same period, the production of electronic parts rose an annual 5.78% because of hot sales of wearable devices and low-end consumer electronic items. Likewise, active demand of wafer foundry and packaging ICs boosted production of semiconductors to a year-on-year rise of 7.52% and machinery & related equipment went up 4.98% thanks to the growing investments in operations. However,  weak demand for TVs and computers led to a drop of 8.55% in LCD panels. (JL)