Taiwan is edging back from the recession triggered by the global downturn, as export and manufacturing figures show a gradual recovery from the gloom.

But the island's performance is still well below where it was a year ago, and it still faces a long haul back to anything like the breakneck growth it experienced during the 1990s.

Exports have been Taiwan's lifeblood, and orders for exports in December improved markedly on the 11% decline seen in November over the previous year, and was better than many had feared.

For 2001 as a whole, export orders dropped 11.5%, again showing that the decline was capped in December, the Ministry of Economic Affairs said on Tuesday.

The year before saw double-digit growth.

On the way back

"Things are improving... from double-digit declines to single digits," said Daniel Chen, chief economist at the Industrial Bank of Taiwan.

"In addition to an improving external environment, domestic consumption will expand with a rising stock market and recovery in the property market."

But the $11.44bn figure was still 8.11% down on December 2000.

Industrial output, too, was creeping back while continuing to be much lower than a year ago.

In December, output was down 6.14% from December 2000, an improvement both on November's 6.49% fall and the 7.53% seen in 2001 as a whole.

The figures emerged a day after Taiwan's president, Chen Shui-Bian, appointed a new Cabinet intended to strengthen economic policy.

Across the Strait

The downturn - which saw Taiwan enter recession in the July-to-September quarter last year - has also hit overseas investment which, at $4.39bn, was 13.5% lower last year than in 2000.

December's figure was, at $260m, little more than half that seen in November.

But money is still flowing from Taiwan to the People's Republic of China.

Although the larger mainland neighbour sees Taiwan as a rebel province, this has not stopped Taiwanese companies from exploiting the cheaper costs available from mainland manufacturing.

China-bound investment was, at $2.78bn, up 6.79% in 2001 on the year before.

Even so, the upsurge in electronics manufacture in China has eased off, with paper, machinery and chemicals investments sharply rising.