Am employee holds a 300 millimetre silicon wafer, with 22 nanometer chips, in the semiconductor production clean rooms at the Globalfoundries fabrication (fab) plant in Dresden, Germany, on Thursday, Feb. 11, 2021. The EU outlined a goal last year to produce at least one-fifth of the world�s chips and microprocessors by value, without giving details on how this would be achieved. Photographer: Liesa Johannssen-Koppitz/Bloomberg(Bloomberg)
Am employee holds a 300 millimetre silicon wafer, with 22 nanometer chips, in the semiconductor production clean rooms at the Globalfoundries fabrication (fab) plant in Dresden, Germany, on Thursday, Feb. 11, 2021. The EU outlined a goal last year to produce at least one-fifth of the world�s chips and microprocessors by value, without giving details on how this would be achieved. Photographer: Liesa Johannssen-Koppitz/Bloomberg(Bloomberg)

Taiwan sounds currency warning as chip demand fuels exports

Overseas demand for chips used in smartphones, artificial intelligence and high-performance computing has helped fuel an appreciation of more than 7% in the Taiwan dollar versus the greenback over the past 12 months, even as the central bank worked to slow gains.
Bloomberg
PUBLISHED ON FEB 22, 2021 04:30 PM IST

Taiwan more than doubled its forecast for export growth this year, but sounded a warning that the global scramble for computer chips is going to add further upward pressure on the local dollar. Stocks and the currency gained.

Exports will likely rise 9.58% this year, compared with a previous estimate of 4.59%, the statistics bureau said Saturday. Gross domestic product may expand 4.64%, more than previously expected and up from a revised 3.11% in 2020, when it was one of the few significant economies to register growth.

“Our trade surplus was $58.8 billion last year,” said statistics chief Chu Tzer-ming. “We expect it to be $63.9 billion this year. This might lead to pressure on the Taiwan dollar to appreciate. Everyone should watch out for this.”

Overseas demand for chips used in smartphones, artificial intelligence and high-performance computing has helped fuel an appreciation of more than 7% in the Taiwan dollar versus the greenback over the past 12 months, even as the central bank worked to slow gains.

The Taiwan dollar closed little changed after strengthening as much as 1.5% Monday, largely in line with intraday gains over the past few weeks before the central bank steps in to “smooth” the gains in late trading. The benchmark Taiwan Stock Exchange index rose 0.4%

While Taiwan’s projected growth for this year lags the global average of 5.4%, based on a Bloomberg survey of economists, it’s coming off a higher base. The island’s successful management of the pandemic and avoidance of lockdowns has also supported domestic consumption.

Despite the currency’s gains last year, the U.S. Treasury added Taiwan to a watch list of potential currency manipulators in December, citing the island’s growing current account surplus, and urged the central bank to allow further gains. That’s leaving policy makers in a dilemma: let the Taiwan dollar gain faster, potentially hurting exporters, or risk tensions with the U.S., a key ally.

“The Taiwan dollar has solid fundamental reasons to appreciate further with Taiwan’s stellar export performance,” said Gary Ng, an economist at Natixis in Hong Kong. “In addition, the central bank will try to avoid being designated a currency manipulator, and it is indeed difficult to stop the inflows driven by better economic prospects and a weaker dollar.”

The government pointed to increased demand for Taiwan’s semiconductors as a key reason it upgraded the 2021 forecasts. Given the leading position of the island’s main chip manufacturers, strong external demand will boost exports, Tsai Yu-tai, director of the statistics department of the Directorate General of Budget Accounting and Statistics, said at a briefing following the release of Saturday’s data.

“We upgraded our export outlook after taking January export data into consideration, plus the fact that Taiwanese businesses with facilities in China are investing more at home, and the changes in the global supply and demand,” Tsai said. “We expect this year’s export growth to be the strongest since 2017.”

At the same time, the export data also underscore Taiwan’s dominance in the global chip supply chain.

U.S. President Joe Biden’s top economic adviser, Brian Deese, last week sought the Taiwan government’s help in resolving the chip shortage that’s hindering U.S. automotive manufacturing. His appeal followed earlier pleas from Japanese and European officials for Taiwan’s help in ensuring supply.

The world’s largest contract chipmaker, Taiwan Semiconductor Manufacturing Co., plans to increase capital expenditure this year to as much as $28 billion to help address the shortage. Shares in the chip giant have surged 23% this year, on top of a 60% jump in 2020, making it the world’s 10th-largest company.

Taiwan’s manufacturing sector has been bolstered by the government’s largely successful handling of the Covid-19 pandemic. Taiwan has consistently ranked near the top of Bloomberg’s Covid Resilience Ranking, having had just nine deaths and fewer than 1,000 cases since the beginning of the outbreak.

That allowed it to avoid the strict lockdowns which brought many other economies to a halt. With a few exceptions, Taiwanese businesses, offices and schools stayed open throughout the year, and there was a boom in domestic travel as people opted to vacation at home rather than head overseas.


SHARE THIS ARTICLE ON
Topics
Close
Governments say getting vaccinated and having proper documentation will smooth the way to travel.(REUTERS)
Governments say getting vaccinated and having proper documentation will smooth the way to travel.(REUTERS)

Covid vaccination 'passports' may open society, but inequity looms

PTI, Tel Aviv
PUBLISHED ON FEB 26, 2021 01:03 PM IST
The highly controlled concert offered a glimpse of a future that many are longing for after months of Covid-19 restrictions.
Close
Representative Image
Representative Image

US achieves milestone of administering 50 million Covid-19 vaccine shots

PTI
PUBLISHED ON FEB 26, 2021 12:53 PM IST
President Joe Biden said on Thursday the US reached the halfway mark of 50 million shots in just 37 days since he came to office.
Close
The microfluidic chip developed by researchers from Rice University in the US measures the concentration of SARS-CoV-2 nucleocapsid (N) protein.(REUTERS)
The microfluidic chip developed by researchers from Rice University in the US measures the concentration of SARS-CoV-2 nucleocapsid (N) protein.(REUTERS)

Novel chip for Covid-19 testing delivers results on smartphone

PTI, Washington
UPDATED ON FEB 26, 2021 12:19 PM IST
The researchers noted that their process simplifies sample handling compared to swab-based PCR tests that are widely used to diagnose Covid-19.
Close
WHO director-general Tedros Adhanom Ghebreyesus (File Photo/REUTERS)
WHO director-general Tedros Adhanom Ghebreyesus (File Photo/REUTERS)

‘Hope other countries follow your example’: WHO chief lauds India, PM Modi

By hindustantimes.com | Written by Karan Manral
UPDATED ON FEB 26, 2021 12:17 PM IST
In a tweet late on Thursday night, Tedros Adhanom Ghebreyesus praised India for providing Covid-19 vaccines to more than 60 countries.
Close
If confirmed by the 100-member Senate, Neera Tanden would become the first person of colour to head the federal agency(Stock images: Getty)
If confirmed by the 100-member Senate, Neera Tanden would become the first person of colour to head the federal agency(Stock images: Getty)

White House expects Neera Tanden to have a high bar of civility and engagement

PTI, Washington
PUBLISHED ON FEB 26, 2021 12:04 PM IST
  • Neera Tanden, 50, is facing a tough time for the confirmation of her nomination over her past Twitter outbursts against several lawmakers, including those from her own Democratic Party.
Close
Umer Jan, 12, takes part in a rally to encourage Canada and other countries as they consider labelling China's treatment of its Uighur population and Muslim minorities as genocide, outside the Canadian embassy in Washington, DC, US on February 19, 2021. (REUTERS)
Umer Jan, 12, takes part in a rally to encourage Canada and other countries as they consider labelling China's treatment of its Uighur population and Muslim minorities as genocide, outside the Canadian embassy in Washington, DC, US on February 19, 2021. (REUTERS)

Canadian panel calls for ‘targeted sanctions’ on China for its role in Hong Kong

By Anirudh Bhattacharyya I Edited by Nadim Siraj
PUBLISHED ON FEB 26, 2021 11:11 AM IST
It is among the recommendations listed in a report released by the House of Commons special committee on Canada-China relations, marking yet another low in the two countries’ deteriorating ties
Close
US State Department spokesman Ned Price speaks during the press briefing at the State Department in Washington, DC. (AFP)
US State Department spokesman Ned Price speaks during the press briefing at the State Department in Washington, DC. (AFP)

United States asks Pakistan to play a ‘constructive role’ in the region

By Yashwant Raj I Edited by Nadim Siraj
PUBLISHED ON FEB 26, 2021 11:01 AM IST
The development comes in the backdrop of a ceasefire agreement along the Line of Control and amid growing calls from experts for a re-set of US-Pakistan ties
Close
Jamal Khashoggi was killed and dismembered at the Saudi consulate in Istanbul in October 2018.(Reuters File Photo)
Jamal Khashoggi was killed and dismembered at the Saudi consulate in Istanbul in October 2018.(Reuters File Photo)

Saudi Crown Prince implicated in Khashoggi murder, US finds

Bloomberg
PUBLISHED ON FEB 26, 2021 10:41 AM IST
It wasn’t immediately clear how much detail the declassified version of the report will provide about Prince Mohammed’s role in the killing.
Close
Vivek Murthy returns as Surgeon General, his old job in the administration of Barack Obama.(Reuters file)
Vivek Murthy returns as Surgeon General, his old job in the administration of Barack Obama.(Reuters file)

'Priority is to turn the pandemic around': US Surgeon General nominee Murthy

PTI
UPDATED ON FEB 26, 2021 12:28 PM IST
Indian-American Dr Vivek Murthy, US President Joe Biden's nominee for America's Surgeon General on Thursday appeared for his confirmation hearing by the Senate.
Close
In a proclamation issued on Wednesday, President Joe Biden said the ban “does not advance the interests of the United States”.(Reuters Photo)
In a proclamation issued on Wednesday, President Joe Biden said the ban “does not advance the interests of the United States”.(Reuters Photo)

US lifts Trump-era ban on legal immigration

By Yashwant Raj, Washington
UPDATED ON FEB 26, 2021 08:00 AM IST
In April 2020, Trump had temporarily suspended for 60 days the entry of legal immigrants - affecting green cards - as layoffs had begun to spike. There were some exceptions, such as dependents of US citizens.
Close
A pedestrian wearing her facemask and holding a cup of coffee walks past a closed sign hanging on the door of a small business in Los Angeles, California.
A pedestrian wearing her facemask and holding a cup of coffee walks past a closed sign hanging on the door of a small business in Los Angeles, California.

In US' California, death toll due to Covid-19 tops 50,000

ANI
PUBLISHED ON FEB 26, 2021 07:58 AM IST
As per the latest data, 1,114 deaths were reported during the previous 24 hours, taking the total toll to 50,991.
Close
In a statement, the FATF noted that Pakistan has made “significant progress” on the entire action plan, and has “largely addressed 24 of the 27 action items”.(AP)
In a statement, the FATF noted that Pakistan has made “significant progress” on the entire action plan, and has “largely addressed 24 of the 27 action items”.(AP)

Terror financing watchdog keeps Pakistan on ‘grey list’

UPDATED ON FEB 26, 2021 07:55 AM IST
The outcome was widely anticipated, though Pakistan has failed to meet all deadlines set by the multilateral watchdog to complete the 27-point action plan that was drawn up after the country was placed on the grey list - which is the list of countries under increased monitoring - in June 2018.
Close
The UN logo at the United Nations headquarters in New York. (HT archive)
The UN logo at the United Nations headquarters in New York. (HT archive)

UNGA President welcomes ceasefire agreement between India, Pakistan

ANI
UPDATED ON FEB 26, 2021 07:53 AM IST
On Thursday, India and Pakistan released a joint statement saying that they have agreed to a ceasefire along the Line of Control (LoC) starting from February 25.
Close
External Affairs Minister S Jaishankar and Chinese State Councilor and Foreign Minister Wang Yi met for nearly two hours on the sidelines of the SCO meet in Russia last year. (PTI)
External Affairs Minister S Jaishankar and Chinese State Councilor and Foreign Minister Wang Yi met for nearly two hours on the sidelines of the SCO meet in Russia last year. (PTI)

Border dispute objective reality, should be put at right position in ties: China

By Sutirtho Patranobis, Beijing
PUBLISHED ON FEB 26, 2021 07:45 AM IST
  • The phone call was the first formal contact between Jaishankar and Wang since they met on the margins of the Shanghai Cooperation Organisation (SCO) meeting in Moscow on September 10 last year.
Close
FILE PHOTO: A 3D-printed Facebook logo is seen in front of a displayed Australian flag in this illustration photo taken February 18, 2021. REUTERS/Dado Ruvic/Illustration/File Photo(REUTERS)
FILE PHOTO: A 3D-printed Facebook logo is seen in front of a displayed Australian flag in this illustration photo taken February 18, 2021. REUTERS/Dado Ruvic/Illustration/File Photo(REUTERS)

Facebook signs pay deals with 3 Australian news publishers

AP, Canberra
PUBLISHED ON FEB 26, 2021 07:22 AM IST
The commercial agreements are subject to the signing of full agreements within the next 60 days, a Facebook statement said.
Close
SHARE
Story Saved
OPEN APP