The Taiwanese Economy 215 CCIFT General Assembly April 9, 215 1
The Taiwanese economy in a few words Key figures A DYNAMIC ECONOMY TAIWAN, 5 th ECONOMIC POWER IN ASIA 214 GDP Growth: +3,74% World s 14 th most competitive economy (WEF) World s 13 th dynamic economy (IMD) World s 5 th currency reserve (418 bn USD, Feb. 215) A LARGE POTENTIAL 64% services, 34% industry, 2% agriculture 23,1 M population with high revenues (Asia s 5th GDP per capita: 22 632 USD ) World s 27 th economy, Asia s 6 th economy (214) A PROMISING MARKET A regional hub to Mainland China World s 18 th importer of goods (27 bn USD in 213) April 9, 215 2
Taiwan in the globalized economy Taiwan, 6 th Asian Economy India 2,48 (1 th ) Japan 4,77 (3 rd ) China PIB : 1,355 Mds USD (2 nd ) Korea 1,34 (14 th ) Indonesia 87 (16 th ) Taiwan 53 (27 th ) Source: IMF, 214 Thailand 387 (3 th ) Malaysia 313 (35 th ) Singapore 298 (36 th ) Hong Kong 274 (39 th ) Philippines 272 (4 th ) April 9, 215 3
The economic situation in Taiwan Taiwan s economic recovery 12 1 1,63 8 6 4 2-2 5,44 6,52,7-1,57 3,8 2,6 2,23 3,74 Contributions to Economic Growth -4-6 26 27 28 29 21 211 212 213 214(p) Private final consumption Government final consumption Investment Stock variation Foreign Trade Economic growth rate Source : DGBAS The main economic indicators 12 1 8 6 4 2-2 -4 21 22 23 24 25 26 27 28 29 21 211 212 213 214 Inflation Unemployment Growth April 9, 215 4
Contributions to Economic Growth Rate (by quarters 214-215*) 5 4,32 4 3,41 3,87 3,35 3,5 3,93 3,76 3,9 3 2 1-1 Q1-214 Q2-214 Q3-214 Q4-214 Q1-215(p) Q2-215(p) Q3-215(p) Q4-215(p) Private final consumption Government final consumption Investment Stock variation Foreign Trade Economic growth rate Source : DGBAS (*) : forecast for 215 (updated on Feburary 16th 215) April 9, 215 5
The major role of the industrial sector Composition of GDP by economic sectors 1981 1983 1985 1987 1989 1991 1993 1995 1997 1999 21 23 25 27 29 211 213 8 7 6 5 4 3 2 1 Agriculture/Mines Industry Services GDP by economic sectors Industry accounts for 34% of GDP in 214 Source : DGBAS/MOEA GDP by kind of activity Services 64,1% Agriculture 1,9% Industry 34,1% 35 3 25 2 15 1 5 (1) Includes accommodation and food services, professional, scientific and technical services, support services, education, human health and social work services, arts, entertainment and recreation, other services, import duties and value-added tax. April 9, 215 6
Key economic indicators for 215 213 214Q1 214Q2 214Q3 214Q4 214 215(f)* Economic Growth 2,23% 3,41% 3,87% 4,32% 3,35% 3,74% 3,78% Inflation,79%,8% 1,63% 1,51%,84% 1,2%,26% Unemployment 4,18% - - - - 3,96% 3,7% Private final consumption (yoy) Investment (GFCF) (yoy) Government final consumption (yoy) 2,35% 2,37% 3,3% 3,76% 2,39% 2,96% 3,12% 4,98%,94% 1,63% 4,83% -,42% 1,74% 3,76% -1,15% 4,17% 2,35% 3,89% 3,5% 3,35% -1,28% Exports (FOB) 1,41%,96% 2,86% 6,67%,45% 2,74% 1,2% Imports (CIF) -,21% -1,64% 3,77% 7,7% -3,23% 1,6% -2,7% Balance (Bn USD) 35,5 6,5 9,7 1,2 13,2 39,6 48,4 Source : DGBAS (*) : forecast for 215 (updated on Feburary 16th 215) April 9, 215 7
Taiwan s Foreign Trade Exports are driving the Taiwanese economy 35 3 25 2 15 1 5 23 24 25 26 27 28 29 21 211 212 213 214 Exports Imports Balance of Trade In 214, exports have reached 314 bn USD (+2,7%), imports 274 bn USD (+1,6%), for a trade surplus of 4 bn USD (+11,4%) Source: DGBAS, BOFT April 9, 215 8
Domestic Investment 3 25 2 15 1 5-5 -1-15 -2 27 28 29 21 211 212 213 214 215(f) Investment growth rate by category Private Enterprises Public Enterprises Government Source : DGBAS, February 215 4 35 3 25 2 15 1 5 Production Index of Manufacturing Investment Goods Import of Capital Goods (in USD, RHS) 4 3 8 6 2 4 1 2 27 28 29 21 211 212 213 214 27 28 29 21 211 212 213 214-1 215(f) -2 Savings/GNP Investment/GNP Savings-Investment/GNP -2-4 April 9, 215 9
Employment Employed persons by sector Number of employees per industry Agriculture; 5% Industry; 36% Services; 59% 35 3 25 2 15 1 5 24 214 Source : DGBAS, February 215 14% Unemployment rate by age (214) Unemployment rate by Educational Attainment (214) 12% 6% 1% 5% 8% 4% 6% 3% 4% 2% 2% 1% % 15~19 2~24 25~29 3~34 35~39 4~44 45~49 5~54 55~59 6~64 65 & over % Primary school & below Junior high Senior high Vocational Junior college University & graduate school April 9, 215 1
Household Income 48 47 46 45 44 43 42 41 4 39 Monthly Earning of Employees (NT$) 6% 4% 2% % -2% -4% 38 2 21 22 23 24 25 26 27 28 29 21 211 212 213 214-6% Source: DGBAS, February 215 Earnings Growth April 9, 215 11
Industrial Production 15 Indexes of Principal Manufacturing Production 1 5 212 213 214-5 Metal & Machinery Industry Information & Electronic Industry Chemistry Industry Food, Textile & Other Industry April 9, 215 12
s of these and low oil prices and continuous launches of consumer electronic Private consumtion cts are expected to boost private consumption. te consumption is projected to rise by 3.12% in 215, higher than 2.96% in the ous year. % 4 2.96 3.12 3 2.35 2 1.82 forecast 1 year 212 213 214 215f Source: DGBAS, Feb. 215. Source: DGBAS, February 215 1 8 6 4 2-2 Indicators for Private Final Consumption Expenditure (%) 27 28 29 21 211 212 213 214 Sales of Retail Trade Sales of Eating-Drinking places New Registered Private Cars (RHS) 22 5 4 3 2 1-1 -2-3 -4 April 9, 215 13
1-212 2-212 3-212 4-212 5-212 6-212 7-212 8-212 9-212 1-212 11-212 12-212 1-213 2-213 3-213 4-213 5-213 6-213 7-213 8-213 9-213 1-213 11-213 12-213 1-214 2-214 3-214 4-214 5-214 6-214 7-214 8-214 9-214 1-214 11-214 12-214 1-215 2-215 Exchange Rates and Oil Prices 115 BIS effective exchange rate 15 95 85 75 65 Taiwan Euro area France Japan Korea United States 32, Exchange rates TWD/USD 31,5 31, 3,5 3, 29,5 29, 214/1 214/2 214/3 214/4 214/5 214/6 214/7 214/8 214/9 214/1214/11214/12 215/1 215/2 215/3 Source: Central Bank of Taiwan April 9, 215 14
Taiwan s Foreign Trade Contribution to imports & exports by trade partners Oceania; 3,3% Middle East; 14,7% Taiwanese imports by origin in 214 Latin America; 2,4% Europe; 11,2% North America; 1,6% Africa; 2,7% Asia; 55,1% Mainland China & HK: 18,1% Japan: 15,2% Asean-6: 12,2% EU 28: 8,9% Taiwanese exports by destination in 214 Latin America; 2,% Middle East; 2,6% Europe; 9,2% Oceania; 1,4% Mainland China & HK: 39,7% Japan: 6,3% Asean-6: 18,7% EU 28: 8,4% Africa;,9% North America; 11,9% Asia; 7,9% Source : MOF, BOFT April 9, 215 15
France s foreign trade with Taiwan French imports from Taiwan in 214 Total Trade in 214 : 3,8 bn EUR ( France, 22 nd trade partner of TW) French imports : 2,25 bn EUR (24 th client of TW) French Exports : 1,6 bn EUR (2 th supplier of TW) 647 M EUR of Trade deficit Commodities Value K euros (growth yoy) Computers, electronics and optical products 999 944 (-8,3%) Machineries and electrical equipments 315 737 (+6,4%) Other industrial products 35 534 (+3,1%) Basic metals and articles thereof 283 13 (+11,9%) Vehicles, Aircraft, Vessels and associated transport equipment 216 142 (+3,9%) Chemicals, Perfumes and Cosmetics 9 36 (-1,%) Others 2 827 (-6,1%) Agroprocessing Industry 8 792 (-33,8%) Natural Hydrocarbon, other products from 3 677 (-29,5%) extractive industries, electricity, waste Produits agricoles, sylvicoles, de la pêche et de 2 419 (+1,%) l aquaculture Products based on refined oil & coke 16 (-1,%) Vehicles, Aircraft, Vessels and associated transport equipment; 9,6% Basic metals and articles thereof; 12,6% Chemicals, Others; Perfumes and,9% Cosmetics; 4,% Other industrial products; 13,6% Machineries and electrical equipments; 14,1% Agroprocessing Industry;,4%Natural Hydrocarbon, other products from extractive industries, electricity, waste;,2% Computers, electronics and optical products; 44,5% Produits agricoles, sylvicoles, de la pêche et de l aquaculture;,1% Products based on refined oil & coke;,% Total 2 246 524 Source : French Customs April 9, 215 16
France s foreign trade with Taiwan French exports to Taiwan in 214 Commodities Vehicles, Aircraft, Vessels and associated transport equipment Value K euros (growth yoy) 332 739 (-4,1%) Other industrial products 313 356 (+8,9%) Chemicals, Perfumes and Cosmetics 257 487 (+12,8%) Agroprocessing Industry 23 958 (+9,8%) Computers, electronics and optical products 214 74 (-38,5%) Machineries and electrical equipments 122 663 (+4,4%) Basic metals and articles thereof 77 82 (+6,1%) Others 23 961 (+37,4%) Produits agricoles, sylvicoles, de la pêche et de l aquaculture 13 33 (+9,5%) Basic metals and articles thereof; 4,9% Machineries and electrical equipments; 7,7% Computers, electronics and optical products; 13,4% Agroprocessing Industry; 14,4% Products based on refined oil & coke;,5% Others; 1,5% Chemicals, Perfumes and Cosmetics; 16,1% Produits agricoles, sylvicoles, de la pêche et de l aquaculture;,8% Vehicles, Aircraft, Vessels and associated transport equipment; 2,8% Natural Hydrocarbon, other products from extractive industries, electricity, waste;,3% Other industrial products; 19,6% Products based on refined oil & coke 8 427 (+3,9%) Natural Hydrocarbon, other products from extractive industries, electricity, waste 5 247 (-29,4%) Total 1 599 747 Source : French Customs April 9, 215 17
Conclusion Solid recovery in 214 and 215 Growth is driven by surge in external demand for ICT/electronic products Geographically, strong demand from the US and Europe (consumer electronics and machinery) Decline of oil price will boost Taiwan s GDP growth and widen trade surplus Low inflation environment Robust private consumption Competitiveness of currency under control Strong exposure of Taiwan s supply chain to product cycles of the electronic industry Households income remains an issue April 9, 215 18