Government Procurement Research (CIER, 中經院) Yesterday
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CIECA News Letter No. 18 / November, 2013 Index Headline News .................................................................................. P.2 Taiwan, Singapore sign ASTEP pact Taiwan manufacturing PMI rises in November Special Report .................................................................................. P.4 Eurozone inflation rise eases pressure on ECB Kenya launches mega $13.8 bn railway project Philippine economy slips to 7% in third quarter Bilateral Meetings ............................................................................ P.8 The 1stJoint Meeting between CIECA and UMFCCI The 6th Taiwan –Luxembourg Joint Business Council Meeting Taiwan-New Zealand Business Leaders Forum The First Portugal-Taiwan Joint Business Council Meeting 2013 The Joint Conference of the Spain-Taiwan Economic and Business Cooperation Committee The 12th Session of the Taiwan -Czech Joint Business Council Guests From Abroad ................................ ...................................... P.16 Mr. Eray Akdağ, Permanent Ankara Representative & Main Liaison to the Turkish Parliament visits CIECA CIECA Dinner in honor of Mr. Ricardo Quijano, Minister of Trade and Industry of Panama Mr. Alfredo Piotrovski, Vice President of FIESC called on Mr. Chi-Yuan Chin, Board Director of CIECA Economic News ............................................................................... P.18 Activity Report ............................................................................... P.26 An Outline of Republic of China’s Economics .......................... P.29 2013 Conference Schedule of CIECA ................................ .......... P.32 1/34 Headline News According to the study conducted by Taiwan, Singapore sign ASTEP pact Chung-hwa Institution of Economic Singapore and the Separate Research, ASTEP is expected to Customs Territory of Taiwan, Penghu, increase Taiwan’s GDP by 701 million Kinmen and Matsu (Chinese Taipei), U.S. dollars, the total national output by both members of the WTO, have signed 1.4 billion U.S. dollars, and add a total the Agreement between Singapore and of 6,154 jobs in Taiwan after fifteen the Separate Customs Territory of years of the Agreement entering into Taiwan, Penghu, Kinmen and Matsu on effect. Economic Partnership (ASTEP) on Press release of Ministry of Economic November 7, 2013 in Singapore. Affairs (11/07/2013) ASTEP was signed by Mr. Calvin Eu, Trade Representative of the Singapore Taiwan manufacturing PMI rises in Trade Office in Taipei, and Mr. Hsieh November Fa-dah, Representative of the Taipei TAIPEI, Taiwan -- Taiwan's Representative Office in Singapore. manufacturing purchasing managers' ASTEP is a comprehensive and index (PMI) registered 52 points in high quality agreement covering areas November, up 0.4 points from October, such as trade in goods, trade in services, according to a report released by the investment, dispute settlement, Chung-Hua Institution for Economic e-commerce, government procurement Research (CIER, 中經院) yesterday. and customs procedures. It is expected PMI is a gauge of manufacturing that ASTEP will enhance economic expansion in which any score above 50 cooperation between Singapore and points represents expansion and any Chinese Taipei and will bring about score below indicates contraction. significant mutual benefits for the While Taiwan's manufacturing peoples of both sides. sector has expanded since March of this Singapore is Taiwan's 5th largest year, the pace of expansion had been trading partner, 4th largest export market, declining for seven consecutive months. with bilateral trade totaling November marked the first time in approximately 28.2 billion U.S. dollars. eight months that the pace of expansion 2/34 marked a positive change. well as previously expected, private Of the five sub-indices, the new domestic demand remained stable, Wu orders expansion index stood at 52.7 said, adding that if the electronics and points, the production index at 53.6, the IT sector regains momentum next year, employment index at 53.7, the supplier Taiwan may experience higher deliveries index at 50.8 and the economic growth at that point. Wu said inventories index at 49.3. that Taiwan's strength in IC design and Electronics and Optical Industry new “cloud” technologies may help Underperform boost Taiwan's IT sector. Of the six manufacturing industries, Pessimistic Outlook except for the electronics and optical Two indices showed anomalise in industry (for which PMI was pegged at November. The PMI for new export 48.8), all industries reported growth in orders was pegged at 46.9, a 0.9-point November. In the order of magnitude of downward adjustment from the expansion, the industries were: previous month's score of 47.8. The transportation equipment (64), economic outlook (for the next six electrical and machinery equipment months) index was pegged at 48.3, (56.1), chemical, biological and which was slightly higher than 47.3, the medical (53.5), basic raw materials mark that the index registered in (53.5), and foods and textiles (52.1). October. The electronics and optical industry Nevertheless, exports usually jump has experienced contraction over the in the fourth quarter because of past two months. Since the industry Christmas shopping season. The low comprises a large portion of Taiwan's indices for new export orders and exports, the industry's weak economic outlook were “very unusual,” performance took a heavy toll on CIER President Wu Chung-shu (吳中 Taiwan's GDP growth this year, which 書) said. was forecast at 1.74 percent by the This phenomenon was particular Directorate-General of Budget, obvious in the IT sector. CIER pointed Accounting and Statistics. out that sales of HTC were While exports did not perform as worse-than-expected in the fourth 3/34 quarter, and the company even delayed dampening fears that the eurozone is some of its product launches from about to face a debilitating period of Christmas shopping season until the falling prices, also known as deflation. Chinese New Year. The inflation rate rose to 0.9 Furthermore, Apple's sales also did percent in the year to November from not go as well as expected, hurting October’s 0.7 percent, slightly ahead of local manufacturers responsible for market expectations for a 0.8 percent supplying the computer giant. Supply increase. Management Institute Taiwan Still, inflation remains well below Executive Director Steve Lai (賴樹鑫) the ECB’s target of just under 2 percent. pointed out that local technology It was a sharp fall in October to a near companies' innovation capabilities have four-year low that spurred the central declined over recent years, in turn bank this month to cut its main interest hurting their performance in the fourth rate to a record low of 0.25 percent. quarter. The fall in inflation had raised fears (The China Post 2013.12.03) of deflation, a protracted fall in prices ------------------------------------------------------ that can cause a slide in consumer Special Report spending as individuals put off purchases in the hope of getting better Eurozone inflation rise eases bargains. Deflation has blighted Japan’s pressure on ECB economy for the best part of two LONDON — Welcome news on decades. inflation and unemployment on Friday Friday’s figures will likely will ease pressure on the European convince the ECB to hold rates Central Bank to act again next week to unchanged at its monthly policy next shore up the 17-country eurozone week, especially as a separate survey economy. But they do little to ease pointed to a turning point in the labor longer-term worries over the recovery. market. Eurostat, the EU’s statistics office, Frederik Ducrozet, an economist at said unemployment was down for the Credit Agricole, said the rise in first time since early 2011 and that inflation “should buy the ECB more inflation edged higher in November, 4/34 time to decide whether or not to further next week, many economists provide more accommodation.” think it will be forced to give the Separately, Eurostat said region’s economy a further shot of unemployment across the eurozone support early next year. eased from September’s record high of Despite the rise in inflation in 12.2 percent to 12.1 percent in October. November, the specter of deflation That was the first decline in the rate hasn’t gone away, partly because wage since February 2011 but still compares increases are muted due to high unfavorably with the equivalent U.S. unemployment and the high value of rate of 7.3 percent. the euro has made imports cheaper. Though the overall rate masks huge Some countries, notably Greece, are disparities across the eurozone, already facing falling prices, a particularly among the young, Eurostat development that may make its debt said that the number of people servicing even more difficult. unemployed in the region fell by Marie Diron, senior economic 61,000 to 19.30 million during the adviser at EY, formerly Ernst & Young, month. The fall, largely a result of thinks policymakers at the ECB need to declines in the largest economies of be mindful of deflation. Germany and France, was the first “The ECB needs to recognise the since April 2011 and came despite a 0.1 risk of deflation more clearly and act percentage point increase in the overall pre-emptively,” said Diron. She said the youth unemployment rate to 24.4 ECB should provide clearer indications percent. that its interest rates will remain low for The figures showed labor market a long period of time. conditions in weaker countries