2001 growth forecast cut

A major government-backed think tank revised its 2001 economic growth forecast to 5.7 percent from 6.1 percent yesterday.

According to the Chunghwa Institution for Economic Research, the cut was made to reflect political uncertainty, slowing global growth and sagging stock prices, according to reports in the local media.

Another private research agency -- the Taiwan Institute of Economic Research -- expects the island's economy to expand 5.5 percent next year, media reports said.

Also commenting on Taiwan's economic health yesterday was Central Bank Governor Perng Fai-nan (彭淮南), who said export growth may slow to as little as 7 percent next year from this year's 20 percent. Perng reportedly urged the government to boost domestic consumption to keep the economy on track.

Meanwhile, the Directorate General of Budget, Accounting and Statistics (DGBAS) yesterday predicted that 2000 fourth-quarter GDP growth would only reach 5.97 percent, due to a slowdown in industrial production and exports as well as the sluggish stock market. DGBAS further estimated that growth will stay below 6 percent through the first half of next year.

However, the DGBAS made the full-year forecast based on the assumption that the average daily stock market volume will rebound to NT$100 billion to NT$120 billion in the short-term.

Recent bourse volumes have been in the NT$40 billion to NT$50 billion range.