TAIPEI (Taiwan News) — Taiwan’s Ministry of Economic Affairs (MEA) has predicted that retail spending for this year will reach NT$4.5 trillion (US$139 billion).

Data from MEA’s statistics department indicates the retail industry's revenue surpassed NT$4.2 trillion in 2022. This is higher than the pre-pandemic years, per UDN.

In the first half of this year, it reached NT$2.2 trillion, setting a new high for the same period in recent years. It is expected the full year will stabilize at NT$4.5 trillion, surpassing the previous year's record.

Despite a post-pandemic return to physical consumption, physical footfall is still lower than pre-pandemic levels. This indicates that consumers have become accustomed to online shopping channels, MEA said.

MEA’s data shows the retail industry had an average growth rate of 3.6% during the pandemic period from 2020 to 2022. This surpassed the pre-pandemic average of 2.1% over the previous three years.

In the first half of this year, the retail industry’s NT$2.2 trillion revenue was the highest for the same period in nearly six years. It represented a year-on-year growth rate of 9%.

The COVID-19 pandemic was a catalyst for online consumption. It also resulted in slower growth in physical storefronts retail growth.

The retail industry previously relied heavily on physical stores. They accounted for more than 85% of retail revenue.

Due to controls during the pandemic, however, average growth in physical retail was down to 2%. Pre-pandemic average growth in physical retail was 3.6%. In contrast, online sales grew, with an average growth rate of 19.7% from 2020 to 2022. 

As control policies were lifted and the impact of a lower base year was felt, physical store revenue saw a year-on-year growth rate of 10%. Online sales growth slowed to 1.1% due to the effect of a higher base year.