Sat, May 24, 2003 - Page 8 News List

Editorial: Healing the economy, curbing SARS

President Chen Shui-bian (陳水扁) met with the leaders of six major trade and industrial groups and three think tanks yesterday at the Presidential Office. During the meeting, Chen announced that he had invited former premier and KMT Vice Chairman Vincent Siew (蕭萬長) to serve as convener of a new economic advisory team. The team will help the Executive Yuan formulate medium and long-term public-construction proposals over the next three to five years, such as a mass rapid transit line to CKS International Airport. It will also study the country's current credit crunch in the hope of revitalizing the economy.

The government has been working on the economy for a long time, with little to show for its efforts. The reason for this is the DPP is seriously short of financial and economic talent as well as experience. Even Vice Premier Lin Hsin-i (林信義), who only had experience as a business manager and none in macroeconomics, could become a top economic official.

That Chen has been able to invite Siew, a man with ample experience in financial, economic and administrative affairs, to make plans for the post-SARS era is a blessing for the DPP. However, if Siew is going to be a short-term consultant, he won't help the economy much. Taiwan has no shortage of prescriptions. What it doesn't have is the ability to implement such prescriptions. Projects will remain on paper if planning, implementation and review cannot be done in concert, as has been the case over the past three years.

Chen could do a lasting service to the nation by establishing a permanent mechanism for national security advisers and economic advisers, along the lines of the White House's Council of Economic Advisers in the US. He should give the economic advisers more real power, which would allow Siew to really get to work on the economy.

The SARS epidemic will have a long-term impact on the nation's social and economic development. Academia Sinica President Lee Yuan-tseh (李遠哲) said SARS will have a deeper impact than the 1997 Asian financial crisis or the 921 earthquake. What is needed are short, medium and long-term plans to rebuild the economy.

In the short term, the NT$50 billion SARS prevention and relief fund will help buffer the impact on transportation, tourism and other service industries. The fund should also help expand public construction budgets and guide industrial transformation.

For the medium term, local demand should be evaluated and properly guided. Even though many industries have been seriously affected by SARS, others including telecommunications, biotechnology and Internet industries will present new business opportunities. The government should take the opportunity to readjust the industrial structure and strengthen the competitiveness of the country's knowledge industries.

For the long term, consideration must be given to the problems created by Taiwanese businesspeople's China fever. The risk of investing in China should be clearly understood and Taiwan's global business strategy should be redefined.

But all the talk about financial and economic prospects in the post-SARS era depends on one premise -- curbing the epidemic and preventing future outbreaks. If the epidemic is not controlled, discussion of the nation's economic future will be worthless. However, relief and economic planning efforts must not be ignored until after the epidemic is over.

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