The outcome of all this is that now over 51 percent of our manufacturing is located overseas — read China — and this is the source of much suffering for many people in Taiwan. The unemployment rate among young people is as high as 14 percent, and more than 40 percent of the people who do have jobs are on salaries of less than NT$30,000.
Despite this, the government has still not learned. It is making the same mistake as it did with manufacturing, with the policy of allowing finance to go over to China that it has followed since 2011.
With the growth in yuan deposits already exceeding 50 percent of the increase in M2 money supply, the impact of this conversion of Taiwan’s financial resources into yuan will certainly be as detrimental as the “getting orders for goods in Taiwan, manufacturing them in China” model has been. The sluggishness of the TAIEX is but one of the repercussions we will see.
Huang Tien-lin is former president and chairman of First Commercial Bank.
Translated by Paul Cooper