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Economic Daily News: Remedies for weak economy

2012/08/02 13:38:45

The Directorate General of Budget, Accounting and Statistics recently lowered its projection for Taiwan's economic growth for 2012 to 2.08 percent, down nearly 1 percentage point from the previous forecast.

This indicates that Taiwan's economy is facing very severe challenges. Some experts have even predicted that the growth rate could drop below 2 percent due to sluggish exports.

Under these circumstances, we suggest that the government take some expansionary measures to boost the weak economy.

First, the government can encourage consumption by lowering interest rates to try to increase the money supply and reduce savings. It can also consider providing consumption subsidies.

Second, the government should consider lowering the value of the Taiwan dollar to stimulate exports. It should also speed up free trade talks with China, Singapore and New Zealand.

Third, in order to expand investment, the government sector should increase its investment in major construction projects. Taiwan should also try to attract more foreign investors to set up operations in this country.

We hope the government will act boldly to implement these measures. (Editorial abstract -- Aug. 2, 2012)

(By Y.F. Low)