The government’s statistics bureau revised down its 2023 growth forecast on Friday to 1.61% from a previous projection of 2.04% made in May. It was the third straight cut to their outlook and would represent the slowest pace of growth since 2015.
Officials also downgraded their export forecast to a 9.51% decrease, more severe than an earlier projection of a 7.27% decline. Consumer prices are likely to rise 2.14% for the year, from an earlier prediction of a 2.26% pickup.
BloombergGross domestic product figures for the second quarter were also revised downward: The economy grew 1.36% in the April-to-June period, from an earlier estimate of a 1.45% expansion.
Friday’s data indicate the government may struggle to put the economy on a favorable footing in the run-up to January’s presidential election. Growth of under 2% would present the opposition challengers to the ruling Democratic Progressive Party candidate, Vice President Lai Ching-te, with ammunition to question the government’s handling of the economy.
The government figures may still be overly optimistic, according to a Bloomberg survey of economists. They see growth of 0.9% this year, the weakest since 2009.
The island’s largest company, Taiwan Semiconductor Manufacturing Co., surprised investors last month by cutting its annual revenue outlook, projecting a 10% fall in sales this year. Executives warned that the anticipated boom in chips for training AI models may not live up to expectations and may not be long-term or sustainable.
China, Taiwan’s largest export market, provided little solace this week as authorities there cut rates in an effort to avert a sharp slowdown in the economy. In the days since, officials have stepped up efforts to buoy financial markets shaken by dismal economic data, a weakening housing market and a crisis in the shadow lending sector.
