Taiwan’s economic growth seems to have strengthened in Q4 2016 on firm exports

The Taiwanese economic growth is expected to have bolstered in the fourth quarter, owing to a decisive turn in electronics exports. According to a Societe Generale research report, the nation’s real GDP growth is likely to have accelerated to 3.4 percent year-on-year in the December quarter from 2 percent in the prior quarter.

Net exports are expected to have contributed greatly to the economic growth as real merchandise exports grew 10.9 percent year-on-year in the fourth quarter from the previous quarter’s 4.4 percent year-on-year. Real goods imports rose more slowly than exports. It grew 7.7 percent as compared with the 3.8 percent growth seen in the third quarter.

With regards to domestic demand, growth in investment is expected to have boosted, as showed by the surge in capital goods imports. On the contrary, consumption growth possibly decelerated as retail sales and government fiscal revenues slowed in October and November.

The export rebound’s momentum is expected to last through the first half of 2017, given buoyant orders and positive base effects, stated Societe Generale. The risk of slowdown in growth would possibly re-emerge in the second half of 2017 when the property market of China loses momentum.