The National Development Council (NDC) yesterday set its annual GDP growth target for next year at a range of between 3.1 percent and 3.7 percent, indicating a flattish year ahead.
According to the latest forecast from the Directorate-General of Budget, Accounting and Statistics (DGBAS), GDP growth this year will come in at 3.43 percent, higher than the 3.2 percent growth target set by the council a year ago.
“As for next year, we think the economic growth will be 3.7 percent at best,” council Minister Kuan Chung-ming (管中閔) said in a news conference. “Taiwan has entered an era of low economic growth accompanied by low inflation.”
It is the first time the council has used a target range for GDP growth and, compared with a specific number, the range is better for capturing the downside risks facing the economy in the coming year, Kuan said.
Uncertainty over the global economy could drag down domestic economic growth next year to 3.1 percent, from the 3.5 percent forecast by the DGBAS, Kuan said.
Kuan said that the slowdown in China and Southeast Asia might worsen next year, while the US Federal Reserve is likely to raise its interest rate, which would create money outflow in emerging economies. He added that declining oil prices would harm oil exporters, which might indirectly affect nations exporting products to oil producers.
By contrast, if the downside risks create only a mild impact, and if ongoing government policies, including the council’s plan to promote local startups, work well, economic growth might reach 3.7 percent, higher than the 3.5 percent forecast by the DGBAS, Kuan added.
GDP growth of 3.1 percent to 3.7 translates into GDP per capita of US$22,649 to US$22,807 next year, according to the council.
The council also aims to maintain the inflation level of less than 2 percent next year and keep jobless rate between 3.8 percent and 3.9 percent, it said.
The jobless rate was 3.98 percent from January through October, while the inflation rate is expected to be 1.18 percent this year and 0.91 percent next year, the DGBAS said.
Last year, the council set a target of keeping the jobless rate this year to less than 4.1 percent and the inflation rate to less than 2 percent.
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