Tuesday, January 6, 2009

The Outlook for 2009: Meeting Taiwan's Economic Difficulties Head On

The Outlook for 2009: Meeting Taiwan's Economic Difficulties Head On
United Daily News editorial (Taipei, Taiwan, ROC)
A Translation
January 6, 2008

The financial crisis of the century has brought down the modern West's proud financial system. The global economy has dropped into a bottomless abyss. As we look forward to 2009, the economic outlook remains pessimistic. For Taiwan's economy, 2009 will definitely be a difficult year. But as the saying goes, a crisis is also an opportunity. Precisely because we face difficulties, we will be extra careful. Precisely because we face difficulties, we will try extra hard. Precisely because we face difficulties, we will display our resilience. For Taiwan's economy, 2009 will be difficult. But we have no choice but to meet these difficulties, head on.

International organizations and economic research institutes are in agreement about this year's global economy. Trade will shrink. Growth will slow. Unemployment and inflation will increase. Social problems will worsen. International tensions will increase. Calls for protectionism will surge. Voices will be raised for governments to take aggressive measures to save the economy. In recent years Taiwan's economic growth has been almost exclusively export driven. It is at risk in the current recession. Taiwan's domestic market is small, and highly dependent upon foreign trade. It will be harder hit than other Asian countries. For example, the Economist predicts that Taiwan's growth rate will shrink 2.9 percent this year. It will experience the lowest growth rate in Asia, the sixth lowest in the world.

This year, research institutes are unanimously bearish about Taiwan's economic performance. But their forecasts about the economic growth rate are about the same. Among them, the Economist's are the most pessimistic. The International Monetary Fund's are the most optimistic. The IMF's approximate the government's official forecast of 2.1 percent. The Academia Sinica, the Chung-Hua Institution for Economic Research, and the Taiwan Research Institute all forecast a domestic growth rate of around 1 percent. Each of these agencies has its own forecasting model. But from a negative 2.9 percent, to a positive 2.1 percent, represents a 5% difference, and nearly 680 billion NT in GDP. This includes both controllable and uncontrollable variables. But these are exactly what we are working to address. Given Taiwan's economic strength, this is all doable.

The overall economic environment is relatively stable. This is Taiwan's most powerful defense against an economic recession. It is also a renewable resource. For example, Taiwan has a high savings rate. By contrast, the United States must first undergo a recovery process by accumulating savings. Taiwan already has the resources necessary for the expansion of economic activity. Interest rates in one country after another have fallen to zero. By contrast, Taiwan's relatively stable investment rates and interest rates have made it a sponge for capital. In terms of financial soundness, our government has kept its debt below 40% GDP. By contrast, the Eurozone's debt ceiling is 60%. Developed nations such as the United States and Japan have long maintained a debt ceiling of over 100%. This gives the government the ability to increase anti-recessionary measures. We have nearly 300 billion US in foreign reserves. This remains a cornerstone of our stable exchange rate and international credibility.

In addition, we have a solid industrial base. This will be crucial to any breakthrough in Taiwan's current economic circumstances. An industrial base is not built in a day. Our current achievements are the result of long-term efforts. The global economy finds itself in a downturn. Numerous industries are now at risk. But the downturn has also provided us with an opportunity for industry consolidation. The government is concerned above all about the integrity of Taiwan's industrial structure, its skilled labor, and its position in the international supply chain. None of these can be replicated quickly. When demand surges, Taiwan's industries must be able to respond swiftly.

Taiwan has substantive strength. This year Taiwan also has something other countries do not have -- the opportunity to reap economic dividends from the normalization of cross-strait relations. Cross-strait restrictions were the ruling Democratic Progressive Party's economic straitjacket. They lost Taiwan many opportunities for economic expansion on the mainland. The two sides have now established direct links. This has reduced the cost of interaction. Taiwan is now a more open platform, a more open Asia-Pacific conduit. The mainland's economy will also face difficulties. Its landing and speed of recovery are still unknown. Any dividends may not be immediately apparent. But as long as we focus on the long-term, as long as we normalize Taiwan's economic development, as long as we move towards the next phase in economic growth, we have made a start, and we stand a chance.

Of course danger lurks throughout 2009. We must proceed cautiously. In particular, we predict a deterioration in the unemployment picture and a corresponding negative impact on social order during the the first quarter. The government must consider this its number one priority. It must not take the matter lightly. This year, there will be no surprises. Nor is there any need for surprises. This is a year to roll up our sleeves and get down to work. During the first quarter the government is issuing consumer vouchers. During the second quarter, it must follow up by expanding public works. It must not simply throw money at problems. It must restore confidence in our society. Confidence is intangible, but highly contagious. Furthermore, it is self-fulfilling. This is something the government must not overlook.

Difficulties and dangers abound. But if we meet difficulties head on, and deal with them, we can still look forward to a 2009 that opens low and closes high.

2009.01.06 03:28 am

一場百年不遇的金融海嘯,掀垮了西方引以為傲的現代金融體系,也將世界經濟打落看不到底的深淵。從這個時點展望二○○九,所有的經濟預測都是悲觀的;二 ○○九對台灣經濟而言,絕對是困難的一年。但套句老話,危機就是轉機,正因為困難,我們會更小心,也因為困難,我們要更努力,更因為困難,才能展現韌性與 差異。二○○九,台灣經濟將迎難而上,也不得不迎難而進。

國際組織或經濟研究機構對今年全球經濟的預測頗為一致,大抵不脫貿易萎縮、成長遲滯、失業及通貨緊縮風險雙雙升高的基調,並由此擔心社會問題惡化、國際政 治趨於緊張、貿易保護主義再起等;進而呼籲各國必須採取積極的作為拯救經濟。在此大環境下,近年獨靠出口擴張支撐的台灣經濟,正承受極大的衰退風險,並因 台灣內需市場規模小,外貿比重相對高,所受衝擊將更甚於其他亞洲國家。例如,英國經濟學人就認為,今年台灣經濟將萎縮百分之二點九,是亞洲最低,在全球排 名倒數第六。

不過,各研究機構雖一致看淡今年台灣經濟表現,但對經濟成長率的預估差距不小。其中,經濟學人的預測最悲觀,最樂觀的是國際貨幣基金(IMF),與政府的 官方預測百分之二點一相當;中研院、中經院、台綜院等國內經濟研究機構則預測在百分之一上下。各機構自有其估測模型,但單從負百分之二點九到正百分之二點 一而言,這五個百分點的差異,代表的是近六千八百億元的國民生產毛額(GDP)能否被創造;其間固然存有可控與不可控的變數,但這正是我們要努力的目標, 而以台灣經濟的實力,這也是可以做得到的。

總體經濟環境的相對穩定,是台灣經濟力抗經濟衰退的最大後盾,更是待勢再起的推進器。例如台灣的高儲蓄率,相對於美國須先經累積儲蓄的復甦過程,我們已擁 有支持經濟活動擴張的資源;而在各國相繼走向零利率之際,台灣相對穩定的雙率更成了吸金利器。再如財政穩健度,目前我國政府債務餘額仍控制在GDP四成以 下,相對於歐元區的六成上限,以及美日等發達國家早已破百,也讓政府擁有相對較大的空間,來推動反景氣周期的擴張財政政策。至於近三千億美元的外匯存底, 更是穩定匯率及維持台灣國際信用的基石。

此外,堅實的產業基礎,則是台灣經濟突破成長困境的主要憑藉。產業的建立非一朝一夕之事,現有的成就是長時期的累積,如今雖因遭逢世界經濟逆流,導致部分 產業陷入險境,但也提供產業整合的契機,政府亦已關注;最重要的是,台灣產業的特色是結構的完整性、技術人力的匯集及在國際供應鏈上的地位;這些,皆非全 然可以快速複製的,當需求回潮,台灣產業也將能以最快的速度回應。

除了實力,台灣今年還擁有其他國家所沒有的機會酖酖兩岸關係正常化後的經濟紅利。兩岸設限曾是民進黨執政時期台灣經濟的緊身衣,也讓台灣失去許多隨大陸經 濟擴張的契機;如今兩岸實現大三通,互動成本的直接降低,更打通台灣建立亞太平台的渠道。儘管,大陸經濟今年也將面臨艱困,著陸及復甦速度未明,紅利不一 定立即可見;但著眼於長期,正常化是台灣發展新經濟型態、邁向下一階段成長高峰的前提和利基,有了開始,就有機會。

當然,二○○九的台灣經濟,絕對是險境處處,必須步步為營。尤其,第一季失業情勢的惡化及對社會秩序的影響,已可預見其發生,政府自必要當成第一要務因 應,不能掉以輕心。這一年,不太會有驚喜,也不需要驚喜,因為這該是實實在在做事的一年,除了第一季的消費券,第二季擴大公共建設必須即時接棒,而且不只 是把錢花出去,更重要的在於穩住民間信心。信心是看不到的意念,卻有很高的傳染性,更會自我實現;在這方面,政府尤其不能輕忽。

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