Taiwan export orders plunge as demand from US, Europe plummets

Orders to Taiwan’s exporters from overseas clients nosedived in December as plummeting demand from the US and Europe brought a brief rebound to an abrupt end.

Export orders plunged 16% in December from a year earlier, according to Taipei’s Ministry of Economic Affairs. That was much worse than the 1% drop economists had forecast, according to a Bloomberg survey. Orders had risen 1% in November, the first increase in 15 months. 

No economist had predicted a decline of more than 5%. 

Steep declines in demand from the US and Europe — Taiwan’s largest and third-largest sources of orders, respectively — contributed to December’s contraction. Orders from the US were down 21.6% while those from Europe fell 39.4%. Orders from China, the second biggest source of orders, fell just 3.5%. 

The drop in December is a return to pre-pandemic norms, when the data often slowed at the end of the year — likely after Christmas production orders had been filled. But that changed from 2020 to 2022, when pandemic-induced spending caused the data to soar even at the end of the year.

The surprising scale of the decline last year raises questions about global demand and the health of Taiwan’s export recovery. Exports in December beat estimates to rise 11.8%, the fastest pace of growth since July 2022. 

Export orders is a broader measure than exports, encompassing shipments from manufacturing facilities both at home and from Taiwanese-owned factories abroad.