Taiwan’s manufacturing industry saw a slowdown in January, according to numbers released by the Taiwan Institute of Economic Research (TIER) on Wednesday.
The latest data shows the industry’s economic indicator took a sharp drop from 13.68 points in December last year to 10.57 points in January, shifting from a stable green light to a weaker yellow-blue signal as production declined.
Experts say the extended Lunar New Year holiday played a major role, with fewer working days throughout the month, impacting output. The rubber and plastics industries saw the biggest decline while the electronics industry also lost momentum.
TIER researcher Hsu Pi-shu (許碧書) says the timing of the Lunar New Year skews month-to-month comparisons. Since last year’s holiday fell in February, this year’s numbers appear weaker. He suggests averaging January and February data for a more accurate assessment.
Beyond this, Hsu says rising trade protectionism could dampen the outlook for 2025. U.S. President Donald Trump is proposing tariffs on all imports, raising concerns about global inflation. China has responded with its own tariffs on U.S. goods, and with U.S. tariffs on Chinese imports now at 20%, China’s export sector is feeling the strain. China may try to boost domestic demand to offset losses, but whether this will drive industrial upgrades or new opportunities remains to be seen.