One day after the government halved its GDP forecast, economists at Standard Chartered Bank (渣打銀行) yesterday remained optimistic, saying falling oil and raw material prices as well as closer ties with China would bolster the local economy next year.
“Taiwan has the advantage of being next to the Chinese market, which is the region’s growth driver with attractive products [to tap into domestic demand there],” Nicholas Kwan (關家明), the bank’s regional head of research in Asia, told a media briefing yesterday.
He said that Asian countries may not be immune to external shocks from the global slowdown, but finding new markets and boosting domestic demand would be the two best strategies to combat the slowdown.
He estimated that Asian economies would bottom out and recover at the end of next year or early 2010, but Asian stock markets may hit rock bottom earlier.
The bank’s Taipei-based economist Tony Phoo (符銘財) said that the local economy has been on a downward correction since the end of 2006 and was unlikely to stay down in the upcoming business cycle.
He maintained his GDP forecast at 2.8 percent for this year and 3.1 percent for next year, in contrast to the government’s latest estimates of 1.87 percent for this year and 2.12 percent next year.
He said that he believed the government’s recent stimulus measures would help put the economy back on track.
“In spite of the downside risk, we believe it is likely that the local economy would post 1 percent growth in the first half of next year,” Phoo said.
He said that record-low oil prices would help reduce costs for domestic businesses, 90 percent of which import capital goods instead of consumer products.
The bank projected that Hong Kong would post 1.5 percent GDP growth next year, down from this year’s 3.7 percent, while South Korea’s GDP may grow by 4 percent next year.
In related news, CPC Corp, Taiwan (台灣中油) yesterday announced it would lower domestic gasoline prices by NT$1 (US$0.03) a liter and diesel prices by NT$1.1 a liter, effective today. Rival Formosa Petrochemical Corp (台塑石化) will also follow suit.
The EU and US are nearing an agreement to coordinate on producing and securing critical minerals, part of a push to break reliance on Chinese supplies. The potential deal would create incentives, such as minimum prices, that could advantage non-Chinese suppliers, according to a draft of an “action plan” seen by Bloomberg. The EU and US would also cooperate on standards, investments and joint projects, as well as coordinate on any supply disruptions by countries like China. The two sides are additionally seeking other “like-minded partners” to join a multicountry accord to help create these new critical mineral supply chains, which feed into
Elon Musk’s lieutenants have reached out to chip industry suppliers, including Applied Materials Inc, Tokyo Electron Ltd and Lam Research Corp, for his envisioned Terafab, early steps in an audacious and likely arduous attempt to break into the production of cutting-edge chips. Staff working for the joint venture between Tesla Inc and Space Exploration Technologies Corp (SpaceX) have sought price quotes and delivery times for an array of chipmaking gear, people familiar with the matter said. In past weeks, they’ve contacted makers of photomasks, substrates, etchers, depositors, cleaning devices, testers and other tools, according to the people, who asked not to
Japan approved ￥631.5 billion (US$3.97 billion) in additional subsidies to hasten Rapidus Corp’s entry into the high-stakes artificial intelligence (AI) chipmaking arena, ramping up support for a project widely regarded as a long shot. The capital is intended to bankroll Rapidus’ work for information technology firm Fujitsu Ltd, one of the initial customers that Tokyo hopes would get the signature endeavor off the ground. The new money raises the fees and investments that the government is injecting into the start-up to ￥2.6 trillion by the end of the current fiscal year to March next year, the Japanese Ministry of Economy, Trade and
The founder of Chinese property giant Evergrande Group (恆大集團) has pleaded guilty to charges of fraud and bribery, a court said yesterday, the latest blow for what was once the country’s leading developer. Evergrande’s rise was propelled by decades of rapid urbanization and rising living standards, but in 2020, its access to credit dramatically narrowed when the government introduced curbs on excessive borrowing and speculation. The company defaulted in 2021 after struggling to repay creditors. Founder Xu Jiayin (許家印), 67, known as Hui Ka Yan in Cantonese, was reportedly held by police in 2023, with Evergrande saying he had been subjected to
RSS