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Economic Daily News: Staying on top of the economic situation

Economic Daily News: Staying on top of the economic situation

Monitoring indicators released Friday showed that Taiwan's economy flashed a yellow-blue light in September, ending a 10-month run of blue lights that indicate an economic slump. The change means the economy is no longer suffering from a rapid downturn, but it does not mean that the economy will return to normal. The government and people, therefore, cannot lower their guard. The first reason why we should not be too optimistic about the economy is that the change may be the result of a low base of comparison, which makes the indicators look better than would be justified by the actual economic situation. The second reason is that after a downturn has persisted for a period of time, a rebound usually follows naturally, but that does not mean that the economy has improved. In previous downturns, Taiwan's exports were hit harder than those of other countries but did not recover at a faster pace than in other countries when the global economy began gaining steam. During the global financial crisis, for example, Taiwan's exports in 2008 and 2009 fell by a total of 17.5 percent, while the exports of South Korea, Singapore and the world dropped only 2.2 percent, 9.9 percent and 10.6 percent, respectively. In 2011, however, Taiwan's exports were only 25 percent higher than in 2007, lower than South Korea's 49.5 percent, Singapore's 37 percent and the world's 30 percent. If the global and domestic economy have truly begun to recover, Taiwan needs to find a way to help its exports grow at a faster clip than in other countries. If the improvement reflected by the economic indicators is only a temporary phenomenon, we absolutely cannot relax. (Editorial abstract -- Oct. 27, 2012) (By Y.F. Low)


Updated : 2021-03-07 17:35 GMT+08:00