The fiscal deficits of countries that use the euro have reduced significantly, but Taiwanese exports are still likely to suffer from the economic contraction in the eurozone, the Council for Economic Planning and Development (CEPD) said.
Taiwan’s exports to the EU were worth US$6.66 billion in the first three months of the year, accounting for 9.2 percent of the nation’s total exports in the period, making the EU the nation’s fourth-largest export market, official data showed.
The total fiscal deficit of the 17-country eurozone was reduced to 3.7 percent of total GDP last year, down from 6.4 percent in 2009, thanks to governments’ austerity measures, the council said in a report released earlier this week, citing the latest data compiled by the European Commission.
The European Commission forecast the total fiscal deficits of the countries using the euro would decrease to 2.8 percent of GDP this year and down to 2.7 percent next year, according to the council’s report.
Although government debt of the EU countries is still on the rise, the growth in their debt has declined, the report said.
However, the IMF has forecast that the economy of the eurozone would remain in recession this year.
In its World Economic Outlook report released last month, the IMF said the eurozone economy would contract 0.3 percent this year, after a contraction of 0.6 percent last year, which the council said indicated that Taiwan’s exports to Europe this year might still suffer from lower demand in the region.
The IMF forecast the economic growth of the eurozone could be 1.1 percent next year, but growth would still be the lowest among developed countries, which would grow 2.2 percent on average, the council said.