TAIPEI — Taiwan’s manufacturing sector continued to show signs of recession in May due to the lingering eurozone debt crisis, the economic slowdown in China and sluggish domestic demand, according to a report released Friday by the Taiwan Institute of Economic Research (TIER).
The manufacturing index stood at 9.6 for the month, down 0.84 points from April, flashing a blue light, which represents contraction, for the third consecutive month.
The May index was the lowest since October 2008, when it dropped to 9.01 owing to the global financial crisis. Since October last year, the manufacturing index has signaled seven blue lights except for February.
Gordon Sun, director of the TIER’s Macroeconomic Forecasting Center, said the institute had previously predicted that the sector would bottom out in the first quarter.
In reality, however, the sector has yet to hit bottom toward the end of the second quarter, as evidenced by its performance over recent months, he added.
By category, the computer, electronics and optoelectronics segments continued to decline in May because of the eurozone debt crisis and a transition period for new products.
The machinery and equipment segment, which previously experienced a slowdown in April, entered a recession in May due to decreased orders from Europe and China, according to the institute.