Orders for Taiwan's exports in February grew more than expected from a year earlier, another sign of an improving picture for Asian exporters as demand from the United States andChina picked up.
The island's high-tech exporters are benefiting from strong sales by Apple Inc., which just launched its 4-G enabled iPad.
On Tuesday, Taiwan reported that export orders in February rose 17.6 percent from a year earlier. A Reuters Poll had expected an increase of 15.5 percent.
A double-digit annual increase had been widely expected because there was a relatively low base for comparison, as Lunar New Year fell in February in 2011. This year, the holiday was in January.
The economics ministry attributed the strong gain partly to the Lunar New Year effect and partly to a 20 percent increase in orders from information and communications sector from February 2011, including hot sales of Apple's iPhone and iPad.
"The Apple fever in the first quarter matches Taiwan's export strength," said Scott Chen, economist at Sinopac Commercial Bank in Taipei. "By the same token, Taiwan and Korea's March export should also be above forecasts."
GENERALLY ENCOURAGING
In January, export orders had declined 8.63 percent from a year earlier.
In February, Taiwan's export orders from the U.S. rose 21.01 percent from a year earlier, compared with 2.45 percent in January.
In the latest data, orders from China increased 19.03 percent from a year earlier, compared with a drop of 20.83 percent in January.
Export orders from Europe, which have been falling due to the euro zone's economic woes, increased 18.3 percent compared with February 2011.
While the new export orders were generally encouraging, the total declined 1.1 percent from January on a seasonally-adjusted basis. In December and January, the month-on-month orders improved, adding to hopes that bad times had bottomed out.
Serena Tseng, economist at Jih Sun Securities in Taipei, said on Tuesday, "We expect export orders to bottom this quarter as the worst time is over, and orders will start to climb in Q2. Most orders will be from electronics gadgets."
In the second quarter, she said, "even though China will remain weak, its nation-wide promotional sales starting in April will boost some orders. U.S. economy is doing better than expected but Europe will still be weak."
Export orders fell 1.1 percent in February from the previous month, after a 2.36 percent rise in January and a 0.56 percent gain in December, while on a year-on-year basis in February they rose 17.6 percent, a reverse from January's sharp contraction.
Taiwan's export orders are a leading indicator of demand for Asia's exports and for hi-tech gadgets, and typically lead actual exports by two to three months.
Last week, Singapore reported that non-oil domestic exports surged 30.5 percent in February from a year earlier. Actual exports from South Korea rebounded in February while Philippine exports unexpectedly rose in January.
The HSBC/Markit February PMI for Taiwan showed the first manufacturing expansion in nine months, with participants noting a higher level of new export orders. China's official PMI meanwhile also showed a rise in new orders.
MILD RECESSION
A marked slowdown in global demand had pushed Taiwan into a mild recession at the end of 2011. The island is one of the most open of Asia's exporters, with an exports-to-gross domestic product ratio of 74 percent, making it extra-vulnerable to declines in external demand.
However, Taiwan's tech exporters have begun to cautiously talk of a bottoming out, with PC maker Compal now seeing its decline in shipments in the first quarter at about 10 percent instead of the 10-15 percent it earlier forecast.
Top contract chip maker TSMC, meanwhile, said last week it would hire 2,000 staff in the first half of this year to meet higher demand, and on Monday said it is considering raising capex spending this year to help enhance the advanced 28 nm process technology and meet rising demand for the technology.
Taiwan's actual exports resumed growth in February after a weak global economy and the Lunar New Year holiday had forced a contraction the previous month, with exports to China and Europe returning to growth and demand for electronics strong.
But there is still a way to go for exporters, and Taiwan's central bank is likely to hold interest rates steady at its quarterly meeting on Thursday as it looks to give a little support to the sector yet keep a lid on prices.
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