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Taiwan’s GDP to shrink for first time in 4 years due to coronavirus

Government estimates suggest overall figure for first half of 2020 is still positive

Taiwan's GDP shrank during the second quarter of 2020. 

Taiwan's GDP shrank during the second quarter of 2020.  (CNA photo)

TAIPEI (Taiwan News) — Taiwan’s Gross Domestic Product (GDP) is likely to shrink by 0.73 percent in the second quarter of the year, its first contraction in more than four years, the government predicted Friday (July 31).

The new forecast by the Directorate General of Budget, Accounting and Statistics (DGBAS) amounts to a cut of 1.23 percent from its previous prediction, CNA reported.

Looking at the first six months of the year, the economy was still growing by 0.41 percent overall, with the trend only negative for the second quarter, according to the DGBAS. It would be the first fall in the GDP since the first quarter of 2016.

The impact of the Wuhan coronavirus (COVID-19) pandemic, and in particular the fall in the number of foreign visitors by 99.57 percent, was a major contributor to the negative figure for the second quarter.

Earlier, the Chung-Hua Institution for Economic Research (CIER) raised its GDP growth forecast for the whole year to 1.77 percent based on the government’s current “Triple Stimulus Vouchers” campaign.