Lee sees challenges for economy

FOREIGN BUSINESS RELATIONS: The president says Taiwan needs to build on its international competitiveness, and stable foreign relations are essential in this regard

By Catherine Sung  /  STAFF REPORTER

Wed, Jan 12, 2000 - Page 1

President Lee Teng-hui (李登輝) praised Taiwan's economic success and outlined what he said would be the challenges for the island's economic development, during a speech at the annual year-end dinner for the American Chamber of Commerce in Taipei last night.

Lee reminded his audience -- speaking in English -- that Taiwan's economic prowess has grown considerably in the last half of the century.

"As the 20th largest economy in the world, Taiwan's influence on the international system can no longer be ignored," said Lee.

This is the second time Lee has spoken at such an occasion -- the first time being during the presidential election campaign in 1996.

In contrast with a politically charged speech made on Monday, where Lee said he fully supported Vice President and KMT presidential candidate Lien Chan's (連戰) proposal to place the party's assets into trust, Lee's speech to Am-Cham focused solidly on Taiwan's economic development.

He pointed to the so-called "Taiwan shock" that jolted the international market in the wake of the 921 earthquake last September, as evidence that the island is an indispensable link in the global economic system.

The quake caused initial panic among global investors, who had worried that the island's high-tech industries would be affected -- worries that for the most part were unrealized.

Looking ahead to the new century, Lee outlined several factors that would affect Taiwan's continued prosperity.

First, Taiwan must strengthen its competitive edge in high-technology and push for greater economic deregulation, he said.

"Taiwan is expected to join the WTO [World Trade Organization] in the near future. We must therefore build a framework for liberalization based on a sound legal system and by pushing forward our policies," he said.

To keep up with the globalization of world markets, Taiwanese firms also need to further commit themselves to improving their transparency, Lee said.

Stability in foreign relations was also a cornerstone of Taiwan's prosperity, he said, because "our domestic market is not large enough and our economy relies greatly on the international market."

AmCham President Paul Cassingham said the chamber is confident Taiwan will witness a smooth transition of power when the new president is elected in March.

"President Lee is leaving lots of economic and political challenges for his successor," he said.

AmCham echoed the position taken by US government officials:that it does not support one particular candidate over any other.

Cassingham did, however, allude to a more controversial subject, saying that government enterprises and KMT-owned businesses have comparative advantages in Taiwan. "We are eager to see the dismantling of party enterprises. It would definitely promote more fair and even competition in the market," he said.