TAIPEI (Reuters) – Taiwan’s economy grew slightly more slowly than expected in the third quarter as coronavirus curbs to contain a local COVID-19 outbreak weighed on consumption, though the island’s hi-tech exports remained strong on sustained global demand for chips.
Gross domestic product (GDP) grew 3.8% in July-September from a year earlier, preliminary data from the statistics agency showed on Friday. That was smallest growth since the second quarter of 2020, when the economy gained 0.35%.
The reading was below the 4% increase forecast in a Reuters poll, and down from a 7.43% rise in the second quarter.
The seasonally adjusted annual rate of growth rose 2.27% in the third quarter, compared to a 7.86% drop in the second quarter.
Headline growth slowed after the government imposed tougher coronavirus restrictions from mid-May to contain a surge in domestic COVID-19 cases.
The government restricted personal gatherings, closed entertainment venues and limited restaurant operations but has since lifted most of those curbs as it managed to get the outbreak under control.
But a surge in exports helped somewhat to offset weak consumption in the quarter, which dropped 5.49% on the year.
Total exports rose 30.12% year-on-year in U.S. dollar terms in the third quarter, the statistics agency said.
Taiwan’s electronics exports have been buoyed by a work-from-home trend during the pandemic and strong demand for new technologies such as 5G and artificial intelligence.
(Reporting by Keanny Kao and Yimou Lee; Editing by Ana Nicolaci da Costa)
