Taiwan needs diverse trade amid US-China row: Finance chief

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Taiwan’s trade has been pressured this year by waning demand from China and around the world. Read more at straitstimes.com.

Escalating US-China tensions have further clouded Taiwan’s outlook and rattled the global semiconductor industry. After the US announced tighter controls over chip exports to China this month, shares in Taiwan Semiconductor Manufacturing Co. fell the most in 28 years. The Taiwanese firm makes chips for major companies that rely on the Chinese market for much of their business, while also taking in about 10 per cent of its own revenue from China-based customers.

Su said Taiwanese businesses have already started relocating factories from China to South-east Asia – not so much in the semiconductor industry, but in machinery and other labour-intensive sectors. Vietnam and Thailand are targets, he added. The finance minister also said Taiwan is looking “very carefully” at how to manage financial stability, as the local dollar has weakened this year and as the benchmark Taiex Index has declined. Global funds have pulled a net US$47 billion from local equities in 2022, putting Taiwan on track for its biggest annual outflow in more than two decades.

The Taiex was up 1.3 per cent as of 9.16am on Monday morning after gaining as much as 1.6 per cent earlier, the first gain in four days, after those regulatory curbs were announced.

 

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