Exports fell 1.9 percent from a year earlier, against a median forecast for growth of 1.78 percent in a Reuters poll of 10 economists. The island's finance minister had told parliament earlier in the week that exports in October would contract, though he did not give specific reasons.

Exports to China, Taiwan's largest trading partner, edged up 0.3 percent, while those to the U.S. contracted 9.5 percent after rising in the previous month. Exports to Europe fell anew.

The finance ministry said it still saw the possibility that fourth-quarter exports would see a slight growth from a year earlier, due to a low base effect.

Exports had risen 10.4 percent on year in September, the first rise after six straight months of contraction and well above forecasts, raising hopes the economy had bottomed out, though the figure was coloured by a one-off surge in refined oil products.

Taiwan is one of Asia's most export-dependent economies and is highly leveraged to the cycle of demand for technology products due to its leading position in the component supply and contract manufacturing chain.

It traditionally benefits from the year-end shopping season as new gadgets go on sale, but faces leaner times after that until the next new product cycle begins. A number of new gadgets, such as Apple Inc's iPhone 5, have recently gone to market.

Official data last month showed that orders for its exports, a leading indicator of demand for Asia's exports which typically leads actual exports by two to three months, picked up in September, while a private PMI survey noted a slowdown in export orders in October had moderated.

Contract chip maker Taiwan Semiconductor Manufacturing Co (TSMC) recently predicted a slowdown in sales in the six months to next March as its customers adjust inventories, followed by a rebound in sales in the second quarter of 2013 thanks to strong demand for mobile devices.

Its rival, UMC, said its October sales rose 12.4 percent from a year earlier, though Quanta Computer Inc, the world's top contract laptop PC maker, said its October sales fell 7.46 percent.

Shipments from fellow technology exporter South Korea saw their first annual gain in four months in October, raising hopes that global demand may be recovering, albeit slowly.

Taiwan's imports fell 1.8 in October, reflecting lower prices for some raw materials but also manufacturers' unwillingness to make fresh investments until the murky external outlook clears. (Reuters)