Alexa

Academia Sinica lowers forecast for Taiwan's economic growth (update)

Academia Sinica lowers forecast for Taiwan's economic growth (update)

Taipei, Dec. 29 (CNA) Academia Sinica, Taiwan's top research institute, lowered its forecast for Taiwan's 2012 economic growth Thursday amid the global economic slowdown. It estimated that Taiwan's gross domestic product (GDP) growth rate in 2012 could fall to 3.81 percent, lower than this year's 4.38 percent. The figure was by far the lowest forecast by Taiwan's research institutes and think tanks. The Directorate General of Budget, Accounting and Statistics had forecast recently that Taiwan will project a growth rate of 4.51 percent in 2012. Ray Chou, a research fellow with Academia Sinica's Institute of Economics, attributed the low forecast to the fact that the global economic situation "has continued to deteriorate since November," saying Taiwan's industrial production index and export orders are both declining. "The development of the European debt crisis is very critical (in influencing the GDP)," Chou said at a press conference. Wang Fan-sen, vice president of the institute, also attended the press conference and echoed Chou's statement, saying that "when Europe sneezes, the rest of the world catches a cold." Although the institute estimated that the inflation rate will be low and stable in 2012, the private consumption growth rate will still fall from 3.38 percent this year to 2.72 percent in 2012 due to the negative impact caused by worker furloughs and declining Taiwan share prices. In terms of foreign trade, it said that although demand in Europe and the United States is declining, the Economic Cooperation Framework Agreement (ECFA) with China will be the driver of the nation's exports, as over 90 percent of the items on the ECFA "early harvest" list will have zero tariffs. Taking uncertainties into consideration, the institute said, there is a chance that Taiwan's GDP will register between 2.07 percent and 5.64 percent growth for the whole of 2012. The Cabinet-level Council for Economic Planning and Development, citing the latest forecasts by the International Monetary Fund, Global Insight and the Asian Development Bank, said a day earlier that Taiwan is likely to have higher growth in 2012 than other highly developed economies in the region such as Hong Kong, Singapore and South Korea. (By James Lee)


Updated : 2021-03-08 10:01 GMT+08:00