Typhoon Nari may have shut down Taipei in Taiwan's worst-ever flooding, killing over 60 people, but its economic impact pales to the fallout from the terror attacks on the US.
"Out of these two major events, the typhoon is really more of a short-term shock," said Joyce Hsu, economist at SinoPac Securities Co (
PHOTO: CHEN CHENG-CHANG, TAIPEI TIMES
Nari shut down Taipei on Monday and Tuesday as flood waters flowed past second-storey windows on main roads and cut electricity to more than 1.3 million homes and businesses.
Floods and landslides killed at least 66 people, disaster response officials said and the Taiwan Stock Exchange said publicly-listed companies reported a total of NT$1.44 billion (US$42 million) in typhoon-related damage.
Much of Taipei is without power and transport facilities like the underground portions of the city's mass transit rail and railroad station may be out of action for weeks.
State-controlled Chunghwa Telecom Co (中華電信), which suffered some NT$870 million in damages, said 412,000 domestic telephone users and 560,000 mobile users had lost service due to flooded equipment that would not be completely repaired until Sept. 28.
But while useless phones and a lengthy commute might make Nari feel a little closer to home to Taiwan's business community, economists say Taiwan's export-oriented economy will take a heavier blow from the US attacks.
HSINCHU SPARED
"North Taiwan has never had such major floods, but it affects mostly small and medium enterprises, and not Hsinchu," she said.
The Hsinchu Science-based Industrial Park (新竹科學園區), the heart of the nation's high-tech industry, was spared most of the typhoon's damage and only a handful of firms reported flooded basements.
However, the industry that accounts for the bulk of Taiwan's exports, and sells its product mainly to the US is bracing for a slower recovery from the tech sector's woes due to political uncertainties after the attacks on the US.
"The events of Sept. 11 mean the seasonal recovery in exports we were expecting in the fourth quarter will be delayed," Hsu said.
Michael Tsai (蔡國智), president of memory chip maker Powerchip Semiconductor Corp (力晶半導體) said he and others in the industry had reached the same conclusion after seeing the attacks on the World Trade Center and the Pentagon.
"We have the same view: `Gosh, the fourth quarter's gone,'" Tsai said on the sidelines of a recent technology industry conference.
BANKING ON AN UPTURN
Taiwan had been banking on an export upturn in the second half, after the economy posted a 2.35 percent decline in the second quarter, the sharpest contraction in 26 years.
In the near term, September exports are likely to see the effect of delayed shipments, as the typhoon shut ports and airports for two days, shortly after flights to the US resumed following the World Trade Center and Pentagon attacks.
With vegetable prices tripling after Nari caused US$33 million in farm losses, economists also said they expected a temporary spike in the consumer and wholesale price indices.
Hermes Yang, economist at Taiwan's Chung Hsing Securities Co (
"Everyone could see that Taipei's infrastructure is still insufficient," Yang said.
He agreed the US attacks were the greater concern for Taiwan's economy.
"A typhoon like this comes only once in a hundred years, but the Sept.11 incident is man-made," he said. "What the United States faces is long-term action against extremists in the Middle East."
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