Taiwan should change its economic priority from achieving maximum growth to providing maximum well-being to its citizens, while adopting new, creative ideas to tackle the unprecedented challenges brought on by globalization and the rise of China, former Democratic Progressive Party chairperson Tsai Ing-wen (蔡英文) said yesterday.
“The goal [of maximum well-being] cannot be achieved without creating more job opportunities, raising wages, striking a balance between exports and the domestic consumption, and avoiding overdependence on one market,” she said as she delivered the keynote speech at a forum organized by the Taiwan Venture Capital Association.
Tsai, a former trade negotiation expert, also urged the nation to promote talks on building a multilateral trade framework, instead of bilateral ones.
Breaking down the structural woes of the economy, which has been suffering from slow growth and marginalization of regional economic integration, Tsai listed the five most important issues that need to be addressed:
First, exports, which generate more than 70 percent of GDP growth, have dominated the nation’s economy for years and that should change, she said.
Second, the business model of most domestic small and medium-sized enterprises — operating offices in Taiwan and manufacturing products overseas, mostly in China — has become less profitable and needs to be overhauled because it is no longer competitive, Tsai said.
Third, the failure to upgrade industries, which could be the result of overdependence on the electronics and telecommunication industries, has scared away local and international investors, she added.
Fourth, cross-trait trade and economic relations, which used to be complementary to both sides, have evolved over time as Taiwan and China have become more like competitors than partners, Tsai said. In addition, the Chinese market has absorbed investment and talent from Taiwan, she said.
For several reasons, including the political complexity of regional integration, the former DPP chairwoman said Taiwan’s economy is in danger of being increasingly marginalized and isolated.
Last of all, Tsai said the uneven distribution of economic benefits and sustainable development are major concerns for the nation because economic gains have not trickled down to ordinary people.
Dealing with China is inevitable, but both sides should develop a new model for bilateral interaction so cross-strait engagement can be more positive, Tsai said.