Taiwan says trade not being much affected by Red Sea disruptions

Evergreen Marine Taiwan

05/02/2024 07:00

TAIPEI, Feb 5 (Reuters) - Taiwanese companies are not
being affected much by disruptions to the key shipping lane of
the Red Sea as it has coincided with the traditional low season
in demand for exporters, Economy Minister Wang Mei-hua said on
Monday.
    Some shipping companies have suspended transit along the Red
Sea route to avoid being attacked by Yemen's Iranian-backed
Houthi group, which has launched waves of exploding drones and
missiles at vessels since November in response to Israel's
military operations in Gaza.
    The Houthi attacks have primarily targeted container vessels
moving through the Red Sea.
    Taiwanese container shipping line Evergreen Marine  2603.TW 
said in December that ships scheduled to pass through the Red
Sea would be rerouted around Africa's Cape of Good Hope.
    Speaking to reporters in Taipei, Wang said her ministry had
spoken with 14 industry groups as well as companies to gauge the
impact of the Red Sea disruptions.
    "The winter is the low season for Europe. So our shipping to
Europe in the winter is rather less. Before the Spring Festival
it's even less," she said, referring to the week-long Lunar New
Year holiday which starts this week.
    "Of course shipping costs have gone up," she said, but added
it was not nearly as bad as in the aftermath of Russia's
invasion of Ukraine in 2022.
    Taiwan has a trade dependent economy and is a major producer
of semiconductors used in everything from cars and microwaves to
smartphones and artificial intelligence servers.
    The second half of the year is when Taiwanese exporters are
traditionally busiest as they ramp up output for the year-end
holiday season in Western markets.
    Taiwan's economy grew by a preliminary 1.4% in 2023, its 
slowest pace in 14 years, but is forecast to bounce back
strongly this year to expand more than 3% given strong demand
for AI applications, many of which are powered by made-in-Taiwan
chips.

 (Reporting by Ben Blanchard; Editing by Sonali Paul)
 ((ben.blanchard@thomsonreuters.com))