Summary of Trends in International Trade for December 2021

2022-01-06

According to the forecast released by IHS Markit (IHS) on December 15, 2021, the global economy will grow by 5.6% in 2021. Due to the continuous changes in the global epidemic have navigate multiple transitions, including the transition from pandemic to endemic COVID-19, the shift from fiscal policy stimulus to monetary policy, and energy transition from hydrocarbons to renewables. It is estimated that the economic growth rate in 2022 will slow down to 4.3%.

In November 2021, Taiwan’s economy continued to show a red signal and the Purchasing Managers Index and the Coincident Indicators continued to expand. While manufacturing and export orders continued to increase due to the shortage of some products has eased, the demand for digital transformation and the application of emerging technologies continues to increase, and the prices of international raw materials are still at high level, which driving the demand for technology application products and traditional industrial products. Also, the Leading Indicators has turned to increase, and the outlook for manufacturing and purchasing managers over the next six month signals expansion, which means that domestic economy is growing steadily. However, the risk of the spread of the new variant virus epidemic and the restart or increase the epidemic control rules in some countries, and the continuous interference of supply chain shortage, which deserve close observation on follow-up developments.

Taiwan’s export orders in November 2021 amounted to US$65.50 billion, for an increase of US$7.72 billion or 13.4% over the same period in 2020. This was mainly because of some products shortage has eased, digital transformation and the demand for emerging technology applications has continued, as well as the continued high prices level in international raw materials markets, which drove the increase in orders for technological application products and traditional industrial products.

In November 2021, total trade value reached US$77.44 billion, for an increase of 31.8% over the same period last year. Of this, exports totaled US$41.58 billion, for a year-on-year increase of 30.2%, while imports totaled US$35.86 billion, for a year-on-year increase of 33.8%. Given the drive for the emerging technology applications and digital transformation business opportunities, as well as the year-end peak season effect, Taiwan's exports reached the highest scale in a single month compared to past year.

Observations on the trade performance of Taiwan and its major trading partners:

Taiwan's exports in November 2021 to its major trading partners (mainland China, the ASEAN 10, the US, the EU, and Japan) grew across the board. The increase in exports to the EU was the highest, at 59.6%, followed by exports to the US, the ASEAN, Japan and mainland China, by 39.2%, 31.2%, 29.1% and14.4%, respectively.

Taiwan's imports from its major trading partners (mainland China, Japan, the EU, the ASEAN 10, and the US) in November 2021 were driven by the continued high price level in international raw material. The highest increases in imports came from the ASEAN 10 at 41.8%, followed by imports from Japan, mainland China, the EU, and the U.S. which increased by 21.5%, 20.6%, 10.0% and 1.7%, respectively.

Of the top 10 exports in November 2021, due to the continuous demand recovery of traditional industrial products and high raw material prices level, fossil fuels (HS27) grew by 152.7% year-on-year for the highest growth rate. In addition, the growth rate of iron and steel (HS72) increased with 110.9%, organic chemical products (HS29) and steel products (HS73), both have an annual growth rate of more than 50%, also showing outstanding growth performance.

CTR:242