Taiwan: Economy continues to slow in Q4
February 1, 2012
In the fourth quarter, GDP rose 1.9% over the same period the previous year, according to data released by the statistical institute on 23 February. The reading confirmed an advance estimate released on 1 February and came in below both the 3.4% expansion recorded in the third quarter as well as market expectations of a 2.8% increase. The deceleration in the fourth quarter came on the back of weaker domestic demand, which offset an improvement in the external sector. Private consumption slowed from a 3.4% annual expansion in the third quarter to a 1.0% increase in the fourth, while gross fixed investment plunged 12.4% (Q3: -9.1% year-on-year). In contrast, the external sector's contribution improved from 3.7 percentage points in Q3 to 4.8 percentage points in the fourth quarter, as imports of goods and services contracted 7.2% (Q3: -3.7% year-on-year), while exports expanded 0.8 % (Q3: +2.1% yoy). On a quarterly basis, GDP contracted 0.15% over the previous period in seasonally adjusted terms, which follows on the 0.05% decline observed in Q3. For the full year 2011, the economy expanded 4.0%, which is less than half the 10.7% expansion recorded in 2010. The government recently revised its GDP forecast for this year downwards, from 4.2% to 3.9%.