For the first time this year, Taiwan’s exports of machine tools to mainland China swung to growth in July, increasing a staggering 15% from the same month of last year, according to Taiwan Association of Machinery Industry (TAMI).

The brisk growth was credited for helping swell the island’s total exports of machine tools to US$398 million in July, a 12.7% increase over a year earlier and better than originally projected US$350 million.

Mainland China has been Taiwan’s prime export outlet for machine tools. However, throughout the first half of this year Taiwan’s exports to the mainland have contracted mostly because of cautious investment sentiment among the mainland’s manufacturers in face of a hazy global economic outlook and increasing uses of Germany-made and Japan-made machines by some mainland Chinese manufacturers with quality-improvement mindset.

In the Jan.-July period, Taiwan shipped US$2.49 billion of machine tools, a gain of 9.90% from the same period of last year. Industry executives, impressed by the increase, put their projections for the island’s machine tool exports at US$4.5 billion at yearend, an increase of around 10% year on year.

In the first half of this year, the Taiwan shipments to the United States spiked 92.4%, to Thailand up by over 60% and to Indonesia up 35.4% year on year. However, exports to India slumped 16.8% to India and shipments to Brazil declined 31.4% to Brazil in the meantime.

TAMI executives worry that Taiwan’s machine tool exports would slow down in the fourth quarter of the year and the first quarter of 2013 due to a slowdown in orders for Taiwan’s machine tools.