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Machinery businesses call for NT dollar devaluation to save exports

Machinery businesses call for NT dollar devaluation to save exports

Taipei, Jan. 14 (CNA) The Taiwan Association of Machinery Industry (TAMI) called Wednesday for a depreciation of the New Taiwan dollar while asking the government for help after the sector suffered in December from its first-ever drop in exports.
The value of machinery exports in December - NT$35.4 billion (US$1.06 million) - represented a year-on-year decline of 28 percent.
TAMI Chairman Huang Puo-chih attributed the fall to South Korea's government-instructed devaluation of the South Korean won by between 30 percent and 40 percent.
The depreciation caused declines on prices of made-in-South Korea machinery products by 10 percent to 20 percent, allowing the products to enjoy stronger competitiveness in the international market and hurting Taiwanese exports, Huang said. As a result, the Taiwanese currency needs to be devalued by 20 percent in order for Taiwanese products to maintain their international competitive edge, Huang said.
Over the years, Taiwan's machinery industry has maintained an annual growth rate of around 10 percent, according to Huang.
Under the 2008 global recession, about 10 percent of manufacturers in the sector was badly affected, he said. If they go out of business, the machinery industry's production line might break off, Huang warned.
He suggested the government take measures to bail out the businesses, including providing short-term and medium-term loans, adjusting steel prices lower, allowing a devaluation of the NT dollar against the greenback at a proper level, cutting short the process of issuing business visas, and raising the industrial research budget.
Huang also asked for talks with the "top leadership" of the government and for establishment of an inter-ministerial task force that can help local businesses ride out the recession.
(By Elizabeth Hsu)




Updated : 2021-05-16 22:46 GMT+08:00