Finance & Business World

Taiwan's export growth probably accelerated in May as demand from emerging markets, including China, tempered weakening sales to the U.S. and Europe.

Overseas shipments increased 15 percent from a year earlier, more than April's 14 percent gain, according to the median estimate of 11 economists surveyed by Bloomberg News. The report is due about 4 p.m. in Taipei today.

Taiwan's trade and investment with China, which regards the island as one of its provinces, is likely to improve as President Ma Ying-jeou's government works to lift a ban on direct transport across the 100-mile Taiwan Strait that separates them.

“There will be some influence from the U.S. for sure,'' Peter Kurz, head of Taiwan research at Citigroup Inc., said on Bloomberg Television. “But the growing exports to emerging markets in China, Russia, India and elsewhere will help mitigate the impact of a slowdown in the U.S.''

China's economy expanded 10.6 percent in the first quarter, compared with 11.9 percent for the whole of last year, an easing its central bank described last week as “moderate.''

Sales of electronics to the world's fastest growing major economy have helped Taiwan weather fallout from the U.S. financial crisis, which has cut demand for Asian exports. Still, a slowdown in the U.S. will inevitably affect export growth, central bank Governor Perng Fai-nan said on March 24.

Support From China

“We continue to expect robust sales to mainland China to keep overall growth supported,'' said Tony Phoo, an economist at Standard Chartered Bank in Taipei. Electronics shipments and sales to Europe and the U.S. are expected to “stay soft.''

China and the U.S electronic check payday advance. are the island's two biggest overseas markets. Overseas shipments are equivalent to about 50 percent of Taiwan's gross domestic product.

“As usual, strong demand from emerging markets boosted exports, while energy drove high imports,'' said Cheng Cheng- mount, chief economist at Citibank Taiwan Ltd. in Taipei.

Imports rose 20.3 percent in May, accelerating from April's 17.7 percent increase, according to the survey of economists.

Taiwan's economy grew a faster-than-expected 6.06 percent in the first quarter, bolstered by overseas shipments and a pickup in consumer spending. The island joined Japan, Hong Kong and Malaysia in reporting expansion that exceeded expectations as trade within Asia buoyed growth.

Hon Hai's Sales

Hon Hai Precision Industry Co., the world's largest contract electronics manufacturer, forecast 2008 sales could rise to as much as $60 billion, according to an analyst who attended the company's annual shareholder meeting in Taipei on June 2. The Taipei-based company makes iPods for Apple Inc., game consoles for Sony Corp. and computers for Dell Inc.

Many Taiwanese electronics makers ship parts and components to China that are re-exported as finished products to other markets. More than 85 percent of Taiwan's computer products are made in China.

Export orders from China and Hong Kong combined advanced 12.2 percent in April from a year earlier. Orders are indicative of actual shipments over the next one to three months.

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