Fri, Oct 17, 2008 - Page 12 News List

No recession on the horizon: Ma

STABLE FUNDAMENTALS The country’s inflation rate is still among the lowest in Asia and its foreign reserves are ranked fifth-largest in the world, the president said

By Ko Shu-ling  /  STAFF REPORTER

President Ma Ying-jeou, center, receives a group of business leaders led by business tycoon Hsu Sen-rong, right, at the Presidential Office yesterday morning. Ma encouraged them to increase investment in the local economy.

PHOTO: CNA

President Ma Ying-jeou (馬英九) said yesterday that Taiwan would not fall into recession, but would see an “economic slowdown,” adding that the nation’s economic fundamentals were sound and its industries vibrant.

Ma said his administration had adopted several measures in response to the financial crisis in the US and the global economic downturn and that he believed the initiatives would yield results.

“Some are worried about whether [the situation] will lead to a recession, but I can assure you that there will only be an economic slowdown,” he said. “The industries are vibrant and it is perfect timing for businesses to show their vitality.”

Ma made the remarks while receiving board members of the Taiwan Provincial Industrial Association and Taiwan Chamber of Commerce and Industry at the Presidential Office yesterday morning.

This year’s government budget was laid out by the former Democratic Progressive Party (DPP) administration, Ma said, adding that his government would allocate more funding next year to boost the economic system.

“I will also take the lead in spending more money,” he said.

Ma said the government was duty-bound to help the failing financial system and that it simply made sense to do so.

He dismissed criticism that government intervention constituted socialism.

In an era characterized by globalization, Ma said all countries feel the pinch when there is something wrong elsewhere in the world.

Luckily, the fundamentals of Taiwan’s economy are sound, Ma said, particularly in the sectors of information technology, research and development and traditional industries.

In addition, the country’s foreign reserves are ranked fifth-largest in the world, with US$280 billion, or an average of US$12,000 per person, he said.

As the nation’s savings rate is 28 percent, Ma said its financial resources were substantial.

The nation’s inflation rate is also among the lowest in Asia and its banking system is sound, he said.

“However, we must not content ourselves,” he said. “With an export-based economy, it is important to increase domestic demand and we will address this issue in next year’s government budget.”

Ma promised to continue deregulation and to reform the tax system, but emphasized the importance of risk control and crisis management.

“As long as we are vigilant, we can reach the goal,” he said.

Ma accused the former DPP government of taking a conservative approach that drove between NT$3 trillion and NT$5 trillion in capital overseas.

With the new measures of his administration, Ma said he was confident that his government would create an international operation headquarters for Taiwanese businesspeople, a global innovation center and a regional financial and trade hub.

Ma said while he was confident the county would weather the economic crisis, it must brace itself for difficulties ahead, improve the fundamentals of its business sectors and continue key reforms.

“Let’s work together,” he said. “As Taiwan goes forward, victory will be ours.”

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