The global financial crisis has had a limited impact on China because the government there introduced stimulus measures and exercised cautious control of the financial sector, but China should seek to depend less on exports to avoid external shocks, a visiting Chinese economist said yesterday.
Ba Shusong (巴曙松), deputy director-general of the Institute of Financial Studies under the Development Research Center of the State Council, told an audience in Taipei that China managed to emerge from the financial crisis relatively unscathed because Beijing adopted an aggressive stimulus valued at 4 trillion yuan (US$585 billion) in a timely manner.
The package helped boost domestic demand and alleviate the pain caused by falling exports, Ba said.
He recently predicted China would recover double-digit GDP growth in the fourth quarter after its economy expanded 6.1 percent and 7.9 percent in the first and second quarters respectively.
Ba said he suggests Beijing return to a moderate currency policy, saying credit availability is too loose and may have negative effects after economic stability has been achieved.
Ba said Chinese financial institutes had not incurred huge losses amid the market turmoil because of their low degree of globalization as well as cautious oversight by regulators.
Meanwhile, the contribution of exports to China’s economy proved less significant than expected, he said.
Looking ahead, Ba said China should embark on a bold and long-term reform of its economic structure and cut dependence on exports.
“It is a great challenge to transform from an export-oriented economy to one driven chiefly by domestic demand,” the economist said. “Companies in different sectors will have to make substantial adjustment and manufacture products for demand at home rather than consumers in the US and Europe.”
Ba said the change would take a long time, but the urbanization program in many parts of China could play a sustained and effective role.
The program, carried out on a citywide basis, had helped strengthen local infrastructure facilities as well as boost property transactions and overall GDP growth, he said.
In addition, Ba said the Chinese yuan should seek to become a major international currency although to do so would be a long-shot.
“China does not have to buy so many US government bonds if the yuan assumes more importance on the world stage,” he said.
He said Beijing could seek first to integrate regional currencies before the yuan could emulate the status of the greenback.
Also to that end, Chinese banks should upgrade and recruit talent rather than overly depend on credit loans, Ba said.
Taiwan will prioritize the development of silicon photonics by taking advantage of its strength in the semiconductor industry to build another shield to protect the local economy, National Development Council (NDC) Minister Paul Liu (劉鏡清) said yesterday. Speaking at a meeting of the legislature’s Economics Committee, Liu said Taiwan already has the artificial intelligence (AI) industry as a shield, after the semiconductor industry, to safeguard the country, and is looking at new unique fields to build more economic shields. While Taiwan will further strengthen its existing shields, over the longer term, the country is determined to focus on such potential segments as
UNCERTAINTY: Innolux activated a stringent supply chain management mechanism, as it did during the COVID-19 pandemic, to ensure optimal inventory levels for customers Flat-panel display makers AUO Corp (友達) and Innolux Corp (群創) yesterday said that about 12 to 20 percent of their display business is at risk of potential US tariffs and that they would relocate production or shipment destinations to mitigate the levies’ effects. US tariffs would have a direct impact of US$200 million on AUO’s revenue, company chairman Paul Peng (彭雙浪) told reporters on the sidelines of the Touch Taiwan trade show in Taipei yesterday. That would make up about 12 percent of the company’s overall revenue. To cope with the tariff uncertainty, AUO plans to allocate its production to manufacturing facilities in
COLLABORATION: Given Taiwan’s key position in global supply chains, the US firm is discussing strategies with local partners and clients to deal with global uncertainties Advanced Micro Devices Inc (AMD) yesterday said it is meeting with local ecosystem partners, including Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), to discuss strategies, including long-term manufacturing, to navigate uncertainties such as US tariffs, as Taiwan occupies an important position in global supply chains. AMD chief executive officer Lisa Su (蘇姿丰) told reporters that Taiwan is an important part of the chip designer’s ecosystem and she is discussing with partners and customers in Taiwan to forge strong collaborations on different areas during this critical period. AMD has just become the first artificial-intelligence (AI) server chip customer of TSMC to utilize its advanced
Chizuko Kimura has become the first female sushi chef in the world to win a Michelin star, fulfilling a promise she made to her dying husband to continue his legacy. The 54-year-old Japanese chef regained the Michelin star her late husband, Shunei Kimura, won three years ago for their Sushi Shunei restaurant in Paris. For Shunei Kimura, the star was a dream come true. However, the joy was short-lived. He died from cancer just three months later in June 2022. He was 65. The following year, the restaurant in the heart of Montmartre lost its star rating. Chizuko Kimura insisted that the new star is still down
RSS