“The increasing dependence on China — already our largest trade partner — will make Taiwan more vulnerable to external shocks,” Yang said.
Yang said the nation should rely more on domestic demand and bolster the service sector.
“That would entail mass legal reforms and construction,” Yang said. “It takes politicians with grand vision to embark on a venture that may not bear fruit for a long time.”
Norman Yin (殷乃平), a money and banking professor at National Chengchih University, said the government could have been more prudent in allocating funds, adding that its NT$58.3 billion budget for minor public works smacked more of pork-barrel spending than a true attempt to provide an economic stimulus.
Private sector players seemed to be less critical of the administration after the TAIEX recently regained some momentum.
Roscher Lin (林秉彬), president of the National Association of Small and Medium Enterprises, says the government averted a systematic liquidity strain by asking banks not to tighten credit and providing a blanket guarantee of saving deposits.
Lin also lauded the reduction of inheritance tax, which he said lured more than US$20 billion in capital home and invigorated the equity market despite poor economic fundamentals.
“The prospects remain uncertain but appear less dismal now,” Lin said.
Stanley Su (蘇啟榮), a senior researcher at Sinyi Realty Co, Taiwan’s only listed property broker, agreed.
Su said slumping property transactions stabilized in March, thanks to a series of rate cuts and recent rallies in the equity market.
“Owing to the easy monetary policy and preferential interest rates on mortgage loans, the property market contracted less than the market expectation,” Su said.
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