Cranes are pictured during a rainy day at a construction site in Taipei, Taiwan November 26, 2021. REUTERS/Annabelle Chih

TAIPEI, May 27 (Reuters) – Taiwan’s economy is expected to grow this year at a slower pace than originally expected, the statistics bureau said on Friday, lowering its outlook due to global inflation and weaker demand. of consumers by COVID-19 at home and abroad.

The revision came as the statistics office raised its export growth forecast for this year, with global demand still strong for the island’s tech products, buoyed by 5G, electric vehicles and high-end computing. of range.

Gross domestic product (GDP) is expected to grow by 3.91% this year, the General Directorate of Budget, Accounting and Statistics said, compared with growth of 4.42% forecast in February.

That will be a slower pace than the 6.45% recorded for 2021, which was the fastest rate in more than a decade since it rose 10.25% in 2010.

Management said the surge in COVID-19 infections in Taiwan and war-induced inflation in Ukraine were affecting domestic and foreign consumers, even as demand for semiconductors, the mainstay of Taiwan’s economy, remained strong.

He now sees exports rising 14.62% this year, from 9.69% forecast earlier.

Taiwan’s exports are a demand indicator for global tech giants such as Apple Inc (AAPL.O) as the island is a major producer of semiconductors, whose global shortage has rocked companies like automakers and is driving up the profits of Taiwanese companies.

In the first quarter, GDP rose a revised 3.14% from a year earlier, up slightly from a preliminary reading of 3.06%, the agency added.

Another risk is a slowing economy in China, Taiwan’s biggest trading partner, where stringent measures to control COVID outbreaks have led to the prolonged lockdown of Shanghai’s economic hub and restrictions on movement in many areas. cities, including Beijing. Read more

The statistics bureau said lockdowns in China and their impact on global supply chain bottlenecks are among the uncertainties for Taiwan’s economic growth this year.

Taiwan’s export orders fell for the first time in more than two years in April, taking a bigger-than-expected hit from China’s tough anti-virus measures and wider global supply chain disruptions . Read more

Reporting by Yimou Lee and Jeanny Kao; Editing by Kim Coghill

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