Lin Hsin-i upbeat about future for nation's economy

Outgoing Vice Premier Lin Hsin-i (林信義) yesterday expressed optimism about the nation's future economic growth, saying that he expects second quarter GDP growth to hit 7 percent.

"It's likely that the government-forecast 6.77 percent GDP figure for the second quarter may be under-estimated," Lin told reporters at a tea party yesterday afternoon held by the Council for Economic Planning and Development (CEPD) -- of which he was also chairman -- to bid him farewell.

"In light of the improving performances in exports, imports, domestic demand and orders, we may see a 7 percent rise in GDP in the second quarter," he added.

Dubbed "Taiwan's Lee Iacocca," -- in reference to the former Chrysler chief executive officer -- Lin, 58, is the first entrepreneur to become a Cabinet official in Taiwan's history.

He became minister of economic affairs in 2000 after serving as vice chairman of China Motor Corp (中華汽車) between 1997 and 2000. In early 2002, he was promoted to serve concurrently as vice premier and CEPD chairman.

Lin is expected to be appointed to head President Chen Shui-bian's (陳水扁) economic advisory task force, but he yesterday denied the speculation, saying that nothing was confirmed.

Even though he has decided to leave the Democratic Progressive Party (DPP) government, Lin expressed confidence in the nation's economy.

"Taiwan's economic fundamentals are quickly improving, bolstered by the solid global recovery," he said.

But he also urged the government to carry out domestic economic reforms including upgrading the nation's industrial development and tackling unemployment.

Lin said he expected the nation's jobless rate to fall below 4.5 percent for the full year this year.

The unemployment rate dropped to 4.45 percent in March, the lowest since June 2001, the Directorate General of Budget, Accounting and Statistics reported last month.

"[Taiwan] has completely bottomed out of a three-year recession," Lin said.

The vice premier yesterday expressed concern over deteriorating relations between Taiwan and China, saying the establishment of a cross-strait framework for peace was necessary to improve trade relations between the two countries.

Lin said that Taiwan had overreacted to China's measures to rein in its runaway economy, which he said would prevent its economic bubble from bursting.

"The cooling measures will trigger a short-term negative impact on raw-material sectors, which few China-based Tai-wanese investments are focused on," he said.