Taiwan's export orders grew 8.5% in December from a year ago, driven by 25.1% jump in orders from Europe; orders from China, US grew at slower rate, indicating global trade rebound could be uneven in Q1

TAIPAI, Taiwan , January 21, 2013 () – Orders for Taiwan's exports in December grew 8.5 percent from a year earlier, in line with expectations, with a jump in orders from Europe providing further evidence that global demand for Asian goods is slowly improving.

The figure matched the median forecast of 10 economists polled by Reuters, although it marked a somewhat slower pace of growth than November's robust 11.1 percent annual expansion.

Taiwan's export-orders data is an indication of the strength of Asian exports and of global demand for technology. They typically lead actual exports by two to three months.

December is usually a quieter month for exporters after a surge of activity from September to November as they rush to get goods to retailers in time for the peak Christmas shopping season.

In December, orders from Europe leapt 25.1 percent from a year earlier, after increasing 9.5 percent in November, which halted an extended slide in sales to the debt-stricken region.

But orders from China and the United States grew at a much slower rate, indicating that a global trade recovery is likely to be sluggish and uneven well into the first quarter.

Orders from the United States last month rose 10 percent compared with 20.3 percent in November, according to ministry figures released on Monday.

Those from Taiwan's top customer China rose 2.4 percent, compared with 9.6 percent in November.

"Growth in orders from Europe mainly came from chemical and petroleum products," said Forrest Chen, an analyst at Ta Chong Bank.

"We're more concerned about China. As the country continues upgrading its technology industry, from doing mainly assembly work to peripheral electronics production, we have seen a fall in semi-manufactured good orders from China since the second half of last year."

Although uncertainties over the global economy continue to cloud the outlook, Taiwan expects export orders to improve in 2013 from last year as worldwide demand for handheld electronic devices such as smartphones remains strong, the economics ministry said, without giving a specific growth forecast.


"We expect export orders will grow 7 percent this year, as compared to 1 percent last year, or 5.2 percent discounting the inflation factor, on a bottoming-out in Europe and on increasing orders from Japan," Chen said.

TSMC , the world's No.1 contract microchip maker, had reported a 20 percent increase in December sales and a 32 percent rise in October-December net profit from the year-ago period.

Taiwanese firms are the main suppliers to most of the world's top tech brands, including Apple Inc, Dell and Nokia. The heavy reliance on electronics exports makes the island's economy especially vulnerable to swings in external demand.

Taiwan's index for the most recent private purchasing managers survey hit an eight-month high in December, reflecting increases in new orders and new export orders.

The economy in China, the biggest export destination for Taiwan's goods, appears to have turned a corner, though its recovery is expected to be modest.

Taiwan's fellow Asian tech exporters continue to struggle, however. South Korean exports in December fell 5.7 percent from a year earlier, while Singapore's non-oil exports tumbled 16.3 percent, led by weakness in electronics.

"It's questionable if the fourth-quarter order growth momentum (for Taiwan) is sustainable, because Apple will not introduce new products in the first quarter, so orders to its component suppliers will be hard to grow," said Anita Hsu, an analyst at Masterlink Securities in Taipei.

"Moreover, uncertainties about (flat) panel exports have increased, so we're quite conservative about the first quarter."

(Reporting by Taipei bureau; Editing by Kim Coghill)

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