Sat, Mar 14, 2009 - Page 12 News List

Council studying need for second round of vouchers

By Crystal Hsu  /  STAFF REPORTER

The Council for Economic Planning and Development (CEPD) said yesterday it would present a report in September on whether the government should issue a second round of consumer vouchers to boost domestic consumption.

CEPD Chairman Chen Tain-jy (陳添枝), the architect of the voucher program, which aims to raise GDP by 0.66 percentage points this year, said he had seen some favorable indicators pointing to a potential economic recovery, although their impact remained to be seen.

Some business leaders and shop owners have called on the government to issue another round of shopping vouchers after the economy contracted a historical 8.36 percent in the fourth quarter. They have suggested that the Mid-Autumn Festival would be a good time to issue new vouchers.

Chen said there would not be enough time to do so since the current batch distributed in January would not expire until the end of September and the Mid-Autumn Festival falls on Sept. 3 this year.

“The government will first have to propose a budget and obtain the legislature’s approval before distributing a second round of vouchers,” he said. “Before doing that, the council has to gauge whether the vouchers were effective in lifting consumption or only used to make regular purchases.”

As of Tuesday, shop owners had cashed NT$53.37 billion (US$1.54 billion) in vouchers, or 63.74 percent of the amount issued thus far, Ministry of Finance data showed. Altogether, the government printed NT$85.7 billion worth of vouchers, with 98.5 percent already distributed.

Chen said he had seen some encouraging economic data recently that could facilitate a recovery. The stock index surged 243.76 points, or 5.24 percent, to close at 4897.39, the CEPD chief said.

“The rally is vital in restoring investor confidence,” Chen said. “The deceleration in export decline provides another relief. The downturn has no chance of reversing up unless exports stop shrinking given their [large] share of the economy.”

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