Taiwan Lowers 2023 GDP Growth Outlook

(RTTNews) - Despite continued recovery in tourism, Taiwan downgraded its growth projection for this year citing weak global demand and investment.

The Directorate General of Budget, Accounting and Statistics forecast real gross domestic product to grow 1.42 percent in 2023 and 3.35 percent next year.

The 2023 outlook was revised down from 1.61 percent estimated in August. The initial forecast for 2024 was 3.32 percent expansion.

The agency expects exports to shrink 3.75 percent in 2023 and real fixed capital formation to decline 9.81 percent. Real private consumption is projected to grow 8.36 percent.

In the third quarter, GDP grew 2.32 percent on a yearly basis, much faster than the 1.41 percent rise a quarter ago.

On a quarter-on-quarter, seasonally-adjusted annualized basis GDP advanced 7.81 percent after rising 7.47 percent in the preceding period.

Household spending advanced 9.23 percent driven by expenditures on services such as transportation, dining out, accommodation, recreation, as well as consumption on vehicles and the flourishing outbound tourism.

Meanwhile, exports declined 1.35 percent despite the emerging of AI applications. At the same time, imports were down 4.45 percent.

Regarding gross capital formation, data showed that investment in transportation equipment grew significantly, while investment in construction and machinery equipment reduced.

Combining the reduction of inventory, real gross capital formation plunged 12.29 percent.

Further, the agency upgraded its 2023 inflation outlook by 0.32 percentage point to 2.46 percent due to rising fruits and vegetable prices owing to typhoons in the second half year. In 2024, inflation is seen at 1.64 percent.