Exports in December declined for the fourth consecutive month and compared with the 23.30 per cent fall in November to US$16.78 billion, said the finance ministry.

However, Taiwan still registered a trade surplus of US$1.86 billion in December, up from US$1.52 billion in November, the ministry said.

The surplus came as the island a record drop in imports in December of 44.6 per cent year on year to US$11.78 billion as domestic demand dried up amid the global financial crisis.

Exports of LCD TVs dived 65.6 per cent year on year to US$0.72 billion while sales of other electronic products fell 43.4 per cent to US$3.24 billion.

Sales to China and Hong Kong last month fell 54 per cent from the previous year to US$4.42 billion and shipments to Southeast Asia dropped 46 per cent to US$1.94 billion.

Imports of agricultural and industrial raw materials last month fell 47.0 per cent to US$8.63 billion, while imports of consumer goods fell 12.3 per cent to US$1.32 billion.

Taiwan's central bank announced its sixth rate cut in three months on Wednesday - by 50 basis points to 1.5 per cent - at an unscheduled meeting, shortly after the record trade declines were released.

'Declines in exports kept widening in the past four months, severely hurting the island's economic activities,' the bank said in a statement.

Mr Tony Phoo, a Taipei-based economist for Standard Chartered, said December's trade data were 'very awful,' adding he expected the key discount rate to fall to one percent by the end of the June. -- AFP