Sat, May 15, 2004 page1

• GDP growth rate climbs to 6.28% in the first quarter

  • By Joyce Huang / STAFF REPORTER
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  The nation's GDP growth rate hit 6.28 percent in the first quarter, up 1.12 percentage points from the estimated 5.16 percent in February, the government statistics bureau said yesterday.

  The rosier-than-expected economic performance was a result of improving exports and private investment, which respectively rose by 18.6 percent and 21.7 percent in the first quarter, said Hsu Jan-yau (許璋瑤), deputy director-general of the Directorate General of Budget, Accounting, and Statistics (DGBAS).

  In light of the first quarter's solid economic upturn, the bureau revised upward its GDP growth estimates for this year to 5.41 percent, up 0.67 percentage points from the estimated 4.74 percent in February, with a forecast GDP growth figure of 6.77 percent, 4.6 percent and 4.18 percent for the next three quarters.

  "The local economy has greatly recovered to the level of the previous boom years of 1999 and 2000," Hsu told a press conference yesterday afternoon.

  As big investments are planned, such as Formosa Group's sixth naphtha cracker plant as well as development of the nation's DRAM (dynamic random access memory) chip making, optoelectronics and textile sectors, Hsu said that the nation's private investment may grow an average 22.9 percent for the year.

  This is expected to contribute 2.6 percentage points to the nation's full-year economic growth.

  Domestic consumption is expected to see a 3 percentage-point increase this year, and may contribute 1.8 percentage points to the nation's full-year economic growth, the DGBAS director-general-designate added.

  "We are going to see a year with both positive export and domestic-demand performance this year," Hsu added.

  He, however, expressed concern over current economic uncertainties, including an expected interest-rate rise in the US, China's plans to cool its over-heated economy and rising oil prices, which he said may pose a negative impact to the local economy in the second half of the year.

  But he also added that yesterday's economic forecast has already taken China's cooling measures into consideration based on the assumption that China's economic growth may be lowered to 8.3 percent this year.

  One of the statistics committee members, Yu Tzong-shian (于宗先), who is also a member of the Academia Sinica, nevertheless, expressed concern that the nation's exports are still heavily dependent on Chinese markets, where one third of the nation's exports are made.

  The nation's consumer price index (CPI) also bottomed out to see 0.51 percent growth in the first quarter with an estimated 0.8 percent for the full year, Hsu said.

  Hsu, however, expressed concern that rising oil prices may negatively impact the nation's CPI, which he said may contract by 0.11 percent if the oil price rises US$1.

  Expressing an optimistic view, another statistics committee member Yeh Wan-an (葉萬安) yesterday said that the local economy would perform better in the future if the nation's political tensions can be soon eased.

  Also see story:

  Chinese slowdown will impact many
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