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Taiwan's economy forecast to grow 2.27% in 2018

2017/08/19 16:26:34

Taipei, Aug. 19 (CNA) Taiwan's gross domestic product (GDP) is expected to grow 2.27 percent in 2018, the highest increase in four years, largely on the back of increasing government investments, according to the Directorate General of Budget, Accounting and Statistics (DGBAS).

Government investments are projected to rise by an annual 10.59 percent next year, showing the biggest growth in nine years, as public infrastructure projects come on stream under the recently passed Special Budget Statute for Forward-Looking Infrastructure, the DGBAS said.

A special fund of NT$108.90 billion (US$3.58 billion) has been allocated for phase one of the public infrastructure program from September 2017 to December of 2018, pending legislative approval of the budget.

The government's total investment in the program over a four-year period is estimated at NT$420 billion.

Boosted by government spending, capital formation in 2018 is projected to grow 2.68 percent compared with an estimated 2.13 percent rise in 2017, the DGBAS said.

The DBGAS said private investment growth in 2018, however, is expected to much smaller than the government's, at an annual 1.55 percent.

It forecast that Taiwan's exports of merchandise and services will grow 2.96 percent in 2018, and imports will climb 2.69 percent.

In addition, private consumption is expected to increase 1.92 percent next year, while the consumer price index is estimated to rise 0.87 percent, the DGBAS said.

On a quarterly basis, the 2018 economy overall will register growth of 2.17 percent, 2.22 percent, 2.30 percent and 2.36 percent, respectively, the DGBAS forecast.

The forecast full year growth of 2.27 will be the highest since 2014, when it hit 4.02 percent, the DBGAS said.

Meanwhile, the DGBAS has raised its forecast for Taiwan's 2017 GDP growth from 2.05 percent to 2.11 percent, citing solid global demand which has been driving Taiwan's exports.

Exports, which account for about 60 percent of Taiwan's economy, are expected to show 4.02 percent annual growth for the whole of 2017, the DGBAS said, raising its forecast 0.07 percentage points.

It dropped its 2017 growth forecast for imports to 3.77 percent, 0.08 percentage points lower than its previous estimate.

Due to a strong showing in the local equity market, private consumption is expected to grow by an annual 1.89 percent in 2017, the DGBAS said, upgrading its forecast by 0.05 percentage points.

Private and government investments are expected to rise 1.70 percent and 3.74 percent, respectively, it said.

With international crude oil and domestic food prices remaining stable, Taiwan's CPI for 2017 is expected to grow 0.66 percent, the DGBAS said.

(By Chen Cheng-wei and Frances Huang)
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