Typhoon Morakot will temporarily drag down the domestic economy because of the massive destruction it caused, a private economic thin tank said yesterday.
The damage from the storm, which triggered the worst flooding in Taiwan in 50 years, will unavoidably have a negative impact on the country’s economy in the third quarter, particularly in the agricultural and tourism sectors, said Liang Kuo-yuan (梁國源), president of the Taipei-based Polaris Research Institute (寶華綜合經濟研究院).
Liang quoted some companies as predicting that economic losses from the typhoon could reach NT$15 billion (US$457.32 million) and that the domestic economy would fall by 0.53 percentage points in the third quarter as a result.
However, the GDP outlook for the fourth quarter was not necessarily “pessimistic,” given that huge governmental funds and resources will be channeled into post-disaster reconstruction, which might rev up economic growth, Liang said.
“The GDP might register growth in the fourth quarter as rehabilitation work kicks off at home and the global economies possibly start rebounding,” Liang forecast.
Citing the 2006 Hurricane Katrina in the US and the killer earthquake in Sichuan Province last year, Liang said that government-initiated reconstruction work in the wake of natural disasters helped rev up local economies and turned contraction into growth.
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