Taiwan: Merchandise exports gain steam in February
Latest reading: Merchandise exports soared 31.5% annually in February, following January’s 4.4% rise. February’s outturn marked the strongest increase since February 2022. A sharp rise was always expected given that this February had more working days than February 2024. Even so, exports growth was nearly double market expectations, with IT and electronics the key growth drivers. Meanwhile, merchandise imports shot up 47.8% over the same month last year in February (January: -16.9% yoy), marking the strongest reading since May 2010.
As a result, the merchandise trade balance deteriorated from the previous month, recording a USD 6.6 billion surplus in February (January 2025: USD 10.0 billion surplus; February 2024: USD 7.9 billion surplus). Lastly, the trend deteriorated, with the 12-month trailing merchandise trade balance recording a USD 86.7 billion surplus in February, compared to the USD 88.1 billion surplus in January.
Panelist insight: On the outlook, ING’s Lynn Song said:
“Given Taiwan’s rising trade surplus with the US, there was and still is a risk of tariffs hitting. Taiwan’s trade surplus with the US has more than septupled since 2017, rising from USD8.4bn to USD64.9bn in 2024. The surge of exports to the US sent Taiwan to ninth place in the ranking of US import partners. Taiwan’s average tariff rate for most favored nations is 6.5%, which, while not the highest in Asia, is higher than the US and thus does risk reciprocal tariff action. Given how Taiwan’s export growth has been largely driven by exports to the US, the potential for tariffs is a significant wildcard for this year’s trade and growth story.”