Taiwan's economic expansion is expected to edge down next year due to deceleration of trade growth, a local think tank said Wednesday.
The Taiwan Institute of Economic Research (TIER) estimated the island's growth of gross domestic product would be 2.3 percent next year, 0.2 percentage point lower than that expected this year.
The island's economy expanded steadily in the first three quarters as strong export growth on solid global demand offset weak local consumption and investment.
Taiwan's real GDP rose 3.11 percent year on year in Q3, the highest level in more than two years.
The island's economic growth so far this year is related to the recovering global economy, especially the economic expansion of the Chinese mainland, said Sun Ming-Te, director of the TIER macroeconomic forecasting center.
However, fixed asset investment and consumption remain weak. The retail sector shrunk in the first two quarters partly due to a drop in the number of Chinese mainland visitors to the island.
Sun pointed out that geopolitical uncertainties and a moderate commodity price increase might dampen trade growth next year, while rising incomes due to a rallying stock market and salary increase might boost consumption and investment.
The think tank also found that cross-Strait economic and trade relations and policies weighed heavily on the island's manufacturing and service sectors, both of which are placing the mainland at the top of their desired investment destinations.
