Alexa

Taiwan legislature approves NT$134 billion budget deficit for 2009

Taiwan legislature approves NT$134 billion budget deficit for 2009
Taiwan legislature approves NT$134 billion budget deficit for 2009

Taiwan’s legislature approved plans for a wider budget deficit in 2009 as the government raises infrastructure spending to boost the economy.

The government expects a NT$134.6 ($4 billion) deficit this year, bigger than the NT$124.8 billion proposed in August. It’s the second consecutive shortfall, and higher than the NT$91.4 billion for 2008.

Taiwan plans to spend NT$858.5 billion, including NT$500 billion on infrastructure projects, over four years to boost domestic growth as exports declined amid a global slowdown. Overseas shipments in December fell by a record 41.9 percent on weaker demand from the U.S. and China.

“The government has embarked on an expansionary policy to stimulate domestic demand and boost the economy,” Cheng Cheng- mount (鄭貞茂), an economist at Citigroup Inc. in Taipei said before the budget was passed. “The government still has room to sell about 5 percent to 6 percent more bonds in 2009 to fund the deficit as Taiwan has a low debt-to-GDP ratio.”

Central government expenditure will climb to NT$1.81 trillion, while income is estimated to reach NT$1.68 trillion, according to Taiwan’s Directorate General of Budget, Accounting and Statistics. Proposed income is 1.8 percent less than previously planned while spending was trimmed 1.1 percent.

The central bank on Jan. 7 cut its benchmark interest rate to 1.5 percent from 2 percent, the lowest level since 2004 after plunging exports and imports added to signs the economy is in a recession. Taiwan slashed its forecast for economic growth in 2009 to 2.12 percent from an earlier projection of 5.08 percent and said exports will fall 9.59 percent in U.S. dollar terms, the first decline in eight years.


Updated : 2021-03-03 11:56 GMT+08:00