Wednesday, August 31, 2011

Lower GDP growth projected for Taiwan this year

l  According to the latest projections by the Cabinet-level Directorate General of Budget, Accounting and Statistics (DGBAS), Taiwan’s gross domestic product (GDP) growth for the year is expected to fall below 5 percent.

l  In fact, following the recent global market volatility and the sluggish performance of the US and European economies, it should surprise no one that Taiwan's projected growth, which has been driven primarily by exports, will experience a slowdown.

l  Since the island’s export trade, which accounts for over 60% of the total GDP in the last five years, remains the key driving force of its continued economic growth and development, it will be hard to fill the gap—whether through private investment or domestic consumption—to keep the economic growth rate close to the original projections at slightly over 5%.

l  On the other hand, leading research agencies have kept its 2011 growth forecast for China unchanged at 9 percent. Therefore, if many of the developed economies do slump back into recession, or a protracted period of meager growth, China may not be in a position to reprise its role to help the global economy recover as it did in 2008-09.

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