Government expects Taiwan to record over 1.8pct GDP growth in 2020

24-Nov-2020 Intellasia | FocusTaiwan | 6:02 AM Print This Post

The National Development Council (NDC), the Cabinet’s policy planning unit, has projected that Taiwan will enjoy annual GDP growth of over 1.8 percent this year, thanks to better-than-anticipated export orders and exports in the fourth quarter of the year.

The forecast is higher than the 1.56 percent estimated by the directorate general of Budget, Accounting and Statistics, NDC minister Kung Ming-hsin told reporters before attending a Legislative Yuan hearing on Monday.

Kung attributed the NDC’s optimistic projection to 3.33 percent GDP growth in the third quarter and what he described as the “better than estimated” performance of exports and export orders in Q4 to date.

Asked if GDP growth in 2020 could surpass 2 percent, Kung said only that the government is continuing its efforts.

Despite the global COVID-19 pandemic, which has adversely impacted economic activity worldwide, Taiwan has so far managed to sustain its economic growth.

On November 3, the Taiwan Institute of Economic Research, an independent non-profit think tank, increased its projection of Taiwan’s GDP growth in 2020 by 0.8 percentage points to 1.91 percent.

Ministry of Economic Affairs (MOEA) statistics show that Taiwan received $363.74 billion in export orders for the first three quarters of the year, up $14.78 billion, or 4.2 percent from the same period in 2019.

Export orders reached $141.08 billion in Q3, up $22.66 billion, or 19.1 percent from the previous quarter; or up $14.98 billion, or 11.9 percent from the same period of the previous year, according to the data.

The ministry has estimated that exports for the year will grow over 4.8 percent annually after recording $51.59 billion of exports in October, month-to-month growth of 3.1 percent or a year-on-year rise of 9.1 percent.

Kung said the impact of the newly-signed regional free trade pact, the Regional Comprehensive Economic Partnership (RCEP), which excludes Taiwan, would not be as great as anticipated in the short run because limited products are to be added to the RCEP list of tariff free items.

Some sensitive industries are still excluded from the list, the economist said, and also there is a long process of tariff reduction under the RCEP.

This gives Taiwan’s government time to help old economy industries upgrade and transform so they are better able to withstand the impact, he said.

The China-led RCEP, made up of 10 Southeast Asian countries, as well as South Korea, China, Japan, Australia and New Zealand, is the world’s largest trading bloc, covering nearly a third of the global economy.

Taiwan is unlikely to be able to join the trade bloc because China, which sees Taiwan as part of its territory, generally blocks its participation in international organisations to try to prevent any perception that Taiwan is a sovereign entity, independent of Beijing.


Category: Taiwan

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