Taiwan trade surplus rises to record as export decline slows

Taiwan’s trade surplus surged to a record high as the plunge in exports slowed in a sign that global demand for technology may soon start to recover.

The trade surplus rose to $8.5 billion in July, its highest level since records began, as the 11-month decline in exports showed signs of easing. 

Overseas shipments fell 10.4% to $38.7 billion last month compared to a year earlier, the Ministry of Finance said Tuesday. That was the mildest decline since October and better than an estimated 20.7% contraction in a Bloomberg survey of economists.

Imports meanwhile dropped 20.9% from a year earlier, following a 29.9% plunge in June. 

While exports are likely to fall as much as 10% in August, they should return to growth at some point between September and November, Beatrice Tsai, the finance ministry’s chief statistician, said in a briefing. 

Home to the world’s leading chipmakers, Taiwan is facing a year-long slump in overseas appetite for technological goods — including its main product, semiconductors — worsened by slowing global economic growth.

Chip exports, the largest single category of shipments, declined 6.2% in July, Tuesday’s data showed, the smallest fall this year.

“We see some signs that the semiconductor cycle may be troughing,” ING Groep NV economists Robert Carnell, Min Joo Kang and Nicholas Mapa wrote in a note before Tuesday’s data. “That could see some moderation in the rate of decline relative to the consensus and to last month’s figures.”