TAIPEI — Taiwan’s trade-reliant economy
is expected to have expanded on the back of strong global demand
for computer chips, though COVID-19 lockdowns in top export
market China and a surge in domestic infections could drag on
demand, a Reuters poll showed.
Gross domestic product (GDP) likely grew 3.1% in April-June
versus a year earlier, the poll of 24 economists shows, after it
expanded 3.14% year-on-year in the first quarter.
Policymakers have said they expect full-year 2022 growth of
less than 4%, downgrading it from previous forecasts of more
than 4% and slower than the 6.45% logged for 2021. That was the
fastest rate in over a decade since it expanded 10.25% in 2010.
Economists’ forecasts for preliminary GDP data due on Friday
varied widely from growth of 1.4% to as high as 4.4%.
“Investment should be the key growth driver in 2Q, thanks to
the still strong capital spending among the leading
Semiconductor firms,” said analysts at DBS bank.
Demand for Taiwanese goods has been hit by COVID-19
lockdowns in China, while domestic consumption has taken a hit
from a surge in local cases, though infections are now waning
and Taiwan has never fully locked down.
As a key hub in the global technology supply chain for
giants such as Apple Inc , Taiwan’s economy has
outperformed many of its regional peers.
A global shortage of semiconductors has swelled order books
for Taiwanese chipmakers such as Taiwan Semiconductor
Manufacturing Co Ltd (TSMC).
TSMC reported forecast-beating second quarter earnings this
month, saying it was “highly confident” about its long-term
The economy in China, Taiwan’s largest trading partner, grew
a tepid 0.4% in the second quarter, highlighting the colossal
toll on activity from widespread COVID-19 lockdowns.
Taiwan’s preliminary figures will be released in a statement
with minimal commentary. Revised figures will be released a few
weeks later, with more details and forward-looking forecasts.
(Poll compiled by Arsh Mogre, Anant Chandak, Devayani Sathyan
and Carol Lee; Reporting by Ben Blanchard and Yimou Lee; Editing
by Jacqueline Wong)