Taiwan lifted by uptick in exports Taiwan's economy grew faster than expected in the fourth quarter, boosted by a rebound in exports, closing off a lacklustre year that prompted the president to praise the nation for "toughing it out." The economy grew 3.42 per cent for the quarter, its fastest since the third quarter of 2011. Analysts had expected a rise of 3 per cent. For the full year, the economy grew 1.25 per cent, compared to forecast growth of 1.13 per cent, a figure the government had revised down repeatedly since the beginning of last year. An uptick in exports in the second half the year helped Taiwan rebound after its GDP contracted slightly in the second quarter. Taiwan is heavily dependent on exports, which are equivalent to 70 per cent of its economy, and throughout much of last year the economy was dragged down by falling demand in key markets of Europe and mainland China. "We are seeing a recovery for example in China's growth momentum and some stabilisation in the global economy, and so that is feeding through to the bottoming out and gradual recovery in Taiwan," said Grace Ng, Taiwan economist for JPMorgan. Exports rose 9 per cent year-on-year in December, an acceleration from sub-1 per cent growth in November. With key trading partners, most notably China, posting promising quarterly economic data this month, economists expect Taiwan's economy to continue expanding in 2013. The government now forecasts 3.53 per cent growth for this year. Continued recovery, however, "is contingent on a stabilising Europe and recovering Chinese demand," wrote Sylvia Liu, an economist with UBS, in a recent note. Growth in tourism, driven largely by the arrival of increasing numbers of mainland Chinese tourists, has helped boost the domestic service sector and offset to a limited extent the weakness in trade throughout the year. Further investment and continued growth in private consumption could help boost Taiwan and ease its dependence on exports, said HSBC economist Donna Kwok, but "the only issue is that it will take more than just one or two quarters, and much more substantial structural reform before this potential can be realised." The low growth has driven widespread frustration with Taiwan's president Ma Ying-jeou, whose approval rating has hovered at a low of 13 per cent for the past four months, according to polling by a local news station. The opposition party this month drew tens of thousands of people to a protest in front of his office. Mr Ma opened his New Year's address with a pledge that Taiwan's economy "will definitely perform better" this year. "Looking back on 2012, a sluggish global economy posed serious challenges," said Mr Ma. I want to say to everyone: Thank you for toughing it out!