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Taiwan's economy appears bound for continued recession as December exports fall

TAIWAN's export volume fell more than expected in December, which stands to hold the trade-dependent island in its current recession.

Exports were down 13.9 per cent year on year in December, an 11th straight decline, the finance ministry said. A Reuters poll forecast a 13.15 per cent fall and November had a 16.9 per cent slide.

Exports for 2015 fell 10.6 per cent, the biggest annual drop since a 20.3 per cent contraction in 2009.

This was attributed to slack demand from China and other global markets. In 2014, exports jumped 2.7 per cent, thanks to Apple Inc's iPhone.

Trends in Taiwan's exports are a gauge for global technology product demand.

Taiwan's economy slipped into recession in the third quarter. The central bank cut interest rates in September and December.

"There is still no sign Taiwan's economy will pick up into the first half of 2016," Andrew Tsai, an economist of KGI Securities, Taipei, said before the data was released.

"With the global economy in such a tough situation, there is room for the central bank to slash the rate by 12.5 basis point each in Q1 and Q2."

"Electronics export momentum is expected to pick up gradually," the finance ministry said. "However, outlook of Taiwan's exports will be dented by the slowdown of global economic growth, growing international competition, falling raw material prices and China's expanding capacity."