It seems that the nation’s economy, which has been giving warning signs for some time, is in a poor state.
Directorate-General of Budget, Accounting and Statistics Minister Shih Su-mei (石素梅) has said the original forecast for GDP growth for the third quarter was only 0.1 percent, but it is now expected to go be negative. If this is true, then the annual GDP growth this year would have trouble even reaching 1 percent.
That the TAIEX until Oct. 1 could maintain a level above 8,300 points has to be regarded as a miracle, because the economies of major nations around the world are suffering, with growth forecasts having to be adjusted downward almost every month.
In the US, the Dow Jones fell from 18,000 points to 16,000 points and in Germany, the DAX fell from 12,000 points at the beginning of the year to 9,000 points. In Japan, India and China, local stock exchanges fell from 19,000 to 17,000 points; 28,000 to 25,000 points; and 5,000 to 3,000 points respectively.
Considering how the stock markets in major nations have fared, the fact that the TAIEX only fell 700 points, from 9,000 to 8,300, during the same time period suggests that Taiwan is actually holding up quite well and doing better than others. You would think that this would be a cause for celebration.
The trouble is, Taiwan is a relatively small, deregulated economy and the state of the global economy has a considerable effect on it.
There are other ways of interpreting the TAIEX’s ability to remain above 8,300 points.
The first is that the government, in an attempt to cover up for the incompetence of President Ma Ying-jeou’s (馬英九) administration, has had to raid the pension fund to artificially bolster the stock market. The Ma administration is completely oblivious and entirely unaware that it has kept the market at an unreasonable level.
The second reason is that the apparent health of the TAIEX is concealing the poor state of the economy and is luring clueless investors to invest in the stock market. If investors suffer big losses when the whole thing comes tumbling down, it would be because they did not know how to invest and would have nothing to do with the Ma administration’s complete lack of ability to steer the economy.
The third reason is related to January’s presidential and legislative elections, and to the low morale among members of the Chinese Nationalist Party (KMT).
Should the TAIEX fall below the 8,000 mark at this juncture, the popularity ratings of the KMT’s current — albeit perhaps merely caretaker — presidential candidate, Hung Hsiu-chu (洪秀柱), might fall well below 10 percent. The fear is that, if this were to happen, the party would hemorrhage seats, leaving it with less than half the number of seats in the legislature that it has now.
When the current situation is evaluated from this perspective, it becomes easier to see why the Ma administration might be keen to conceal the true state of the economy.
Kuo Chen-hero is an adjunct professor in the School of Business at Soochow University.
Translated by Paul Cooper
Saudi Arabian largesse is flooding Egypt’s cultural scene, but the reception is mixed. Some welcome new “cooperation” between two regional powerhouses, while others fear a hostile takeover by Riyadh. In Cairo, historically the cultural capital of the Arab world, Egyptian Minister of Culture Nevine al-Kilany recently hosted Saudi Arabian General Entertainment Authority chairman Turki al-Sheikh. The deep-pocketed al-Sheikh has emerged as a Medici-like patron for Egypt’s cultural elite, courted by Cairo’s top talent to produce a slew of forthcoming films. A new three-way agreement between al-Sheikh, Kilany and United Media Services — a multi-media conglomerate linked to state intelligence that owns much of
The US and other countries should take concrete steps to confront the threats from Beijing to avoid war, US Representative Mario Diaz-Balart said in an interview with Voice of America on March 13. The US should use “every diplomatic economic tool at our disposal to treat China as what it is... to avoid war,” Diaz-Balart said. Giving an example of what the US could do, he said that it has to be more aggressive in its military sales to Taiwan. Actions by cross-party US lawmakers in the past few years such as meeting with Taiwanese officials in Washington and Taipei, and
Denmark’s “one China” policy more and more resembles Beijing’s “one China” principle. At least, this is how things appear. In recent interactions with the Danish state, such as applying for residency permits, a Taiwanese’s nationality would be listed as “China.” That designation occurs for a Taiwanese student coming to Denmark or a Danish citizen arriving in Denmark with, for example, their Taiwanese partner. Details of this were published on Sunday in an article in the Danish daily Berlingske written by Alexander Sjoberg and Tobias Reinwald. The pretext for this new practice is that Denmark does not recognize Taiwan as a state under
The Republic of China (ROC) on Taiwan has no official diplomatic allies in the EU. With the exception of the Vatican, it has no official allies in Europe at all. This does not prevent the ROC — Taiwan — from having close relations with EU member states and other European countries. The exact nature of the relationship does bear revisiting, if only to clarify what is a very complicated and sensitive idea, the details of which leave considerable room for misunderstanding, misrepresentation and disagreement. Only this week, President Tsai Ing-wen (蔡英文) received members of the European Parliament’s Delegation for Relations