Taiwan lowers 2023 GDP growth forecast to 2.04% as exports weigh

Taiwan lowers 2023 GDP growth forecast to 2.04% as exports weigh

TAIPEI: Taiwan’s economy will probably grow more slowly in 2023 than previously forecast, the government’s statistics office said on Friday (May 26), as weakening global demand weighs heavily on its key technology exports.

The island’s gross domestic product (GDP) is now expected to expand 2.04 per cent in 2023 from last year, the Directorate General of Budget, Accounting and Statistics said, revising its earlier 2.12 per cent growth forecast.

The statistics agency now sees 2023 exports falling 7.27 per cent from last year, compared with a 5.84 per cent slide predicted earlier. Taiwan’s export orders slipped for an eighth straight month in April and missed forecasts.

First quarter GDP fell by a revised 2.87 per cent year on year versus a preliminarily forecast 3.02 per cent fall, the agency said, the worst performance since 2009.

Taiwan’s economy has slipped into recession after contracting for two quarters in a row, and the central bank governor warned this week it may not rebound until the fourth quarter.

Governor Yang Chin-long said on Wednesday that policymakers will weigh both inflation and economic growth when making their next interest rate decision on Jun 15. It has raised rates five times since March last year.

The statistics office also revised upwards Taiwan’s inflation outlook for 2023 to 2.26 per cent, versus a previous forecast of 2.16 per cent.