The domestic production share of export orders received by Taiwanese companies rose to a record 52.9 percent last year, while the combined share produced in China and Hong Kong fell below 30 percent for the first time, the Ministry of Economic Affairs (MOEA) said yesterday.
The decline was mainly attributed to US-China trade tensions, which have prompted Taiwanese businesses to gradually relocate production back to Taiwan or expand their manufacturing operations outside China, the ministry said in a report on its annual survey of the overseas production of export orders.
The survey showed that the domestic production ratio rose 1.6 percentage points from 2024, as strong artificial intelligence (AI) and cloud computing demand drove growth in semiconductor manufacturing and server orders, which are mostly produced in Taiwan.
Photo: CNA
Meanwhile, the share produced in China and Hong Kong fell 6.9 percentage points to 26.2 percent, while ASEAN’s share rose 2.1 percentage points to a record 11.3 percent, led by Vietnam at 4.5 percent.
Self-production, including output by subsidiaries and affiliated companies, remained the dominant category at 78.4 percent of export orders, though the share fell 4.2 percentage points from a year earlier, the survey indicated.
Outsourced production rose to 11.5 percent owing to higher reliance on contract manufacturers by smartphone and laptop makers, while purchases from other manufacturers rose to 10.1 percent amid higher order volumes at semiconductor distributors, the ministry said.
Of 2,779 companies surveyed, 802, or 28.9 percent, had overseas production, citing customer requirements (51.7 percent), lower costs (47.9 percent) and easier access to local materials (32.2 percent) as the main reasons, according to the survey.
Goods made overseas were mostly resold to third countries (71.5 percent), followed by local sales (22.1 percent) and shipments back to Taiwan (6.5 percent).
The share of China and Hong Kong-made goods exported to the US fell 4.7 percentage points to 14.8 percent, as US-bound production shifted to Taiwan and other locations.
ASEAN, led by Vietnam, remained the top destination for new and expanded production lines, while two-thirds of relocated lines moved out of China and Hong Kong, the ministry said.