A slow year for Taiwanese chip makers will stifle the job market, temper new investments in tech hardware and ultimately weigh on economic output, analysts say.
Taiwan’s economy shrunk 0.86 per cent between October and December from a year earlier, the first quarterly contraction in more than six years, as booming pandemic-era demand for hi-tech goods dried up.
Although third quarter economic growth was faster than expected, demand for Taiwan’s hi-tech exports is being undermined by global inflation and Covid disruptions in mainland China, analysts say.
Taiwan’s industrial output index fell for the first time in more than two and a half years in September, with production in South Korea and Singapore having also eased due to weak consumer demand caused by the war in Ukraine, high inflation and fallout from China’s zero-Covid policy.