The nation’s export-oriented economy could expand a mild 2.1 percent next year, as advanced markets undergo a small recovery, while emerging markets avoid a hard landing, Fubon Financial Holding Co (富邦金控) said yesterday.
There is no evident concern or excitement on the horizon next year, when the economies in the US, Europe and Japan may grow 2.4 percent, 1.6 percent and 0.8 percent respectively, Fubon Financial said in a report.
China, the main destination for Taiwanese exports, could continue to slow with GDP growth of 6.6 percent, creating further challenges for raw material prices and outbound shipments, the nation’s second-largest financial services provider said.
The weak economic showing at home this year suggests a low comparison base for next year when the economy would fare better with 2.1 percent growth, Fubon Financial economist Rick Lo (羅瑋) said.
The forecast is slightly lower than a forecast by the Directorate-General of Budget, Accounting and Statistics on Friday last week of a 2.32 percent growth.
The decline in crude oil prices could taper off going forward in light of ultra-low prices, but the price might not see much of a comeback due to soft demand, Lo said, forecasting that crude would hover at between US$40 and US$60 a barrel.
Downside risks such as interest rate increases by the US Federal Reserve, China’s hard landing and the persistent slump in raw material prices could upset the growth projection, Lo said.
Schive Chi (薛琦), a special economist at Fubon Financial, cautioned that more local manufacturers might move their production facilities to Southeast Asian nations to take advantage of low tariffs due to Trans-Pacific Partnership (TPP) membership. Taiwan’s failure to join the regional trade block in the foreseeable future would weaken its competitiveness, he said.
The lack of breakthrough innovations in mobile devices would also limit growth, as Taiwan is home to the world’s largest contract chipmakers, chip designers and suppliers of critical components, he said.
MOVING ON UP: Taiwan improved in all four areas measured by the IMD, making its biggest leap, from 17th to sixth place, in economic performance Taiwan moved up three spots from last year to place eighth, its best performance since 2013, in the latest annual world competitiveness rankings, released yesterday by the International Institute for Management Development (IMD). Innovation, digitalization, welfare benefits and social cohesion are critical to economic performance, with Switzerland, Sweden, Denmark, the Netherlands and Singapore making up the top five on the list this year, the Switzerland-based institute said, after grading 64 countries and regions based on economic performance, infrastructure, and government and business efficiency. “Leading performers are characterized by varying degrees of investment in innovation, diversified economic activities and supportive public policy,” IMD
With the US opening up to travel, demand in Taiwan for US-bound flights has soared, pushing up ticket prices to most destinations in North America, tourism sources said. Fares for destinations in the US have risen dramatically since the middle of last month, and the trend is expected to continue in the coming months, as California on Tuesday lifted most social distancing and capacity limits put in place to contain the spread of COVID-19, ezTravel Co (易遊網) said in a statement yesterday. The travel agency forecast that the number of tickets sold this month is likely to be double or triple
‘MATTER OF SURVIVAL’: Vice Premier Liu He is to lead the development of ‘third-generation’ chips, a field not yet dominated by any nation or company Chinese President Xi Jinping (習近平) is renewing his years-long push to achieve technology self-sufficiency by tapping a top deputy to shepherd a key initiative aimed at helping domestic chipmakers overcome US sanctions. Chinese Vice Premier Liu He (劉鶴), Xi’s economic czar whose sprawling portfolio spans trade to finance and technology, has been tapped to spearhead the development of so-called “third-generation” chip development and capabilities, and is leading the formulation of a series of financial and policy supports for the technology, people with knowledge of the matter said. It is a nascent field that relies on newer materials and gear beyond traditional silicon,
OPPORTUNITY: The company aims to sell its product soon, as enterovirus vaccines are not available anywhere but China, where firms are only marketing their vaccines locally Medigen Vaccine Biologics Corp’s (高端疫苗) phase 3 clinical trials for an enterovirus 71 (EV71) vaccine completed the multi-regional, multi-central data “unblinding” yesterday, with the results, including safety, immunogenicity and efficacy, meeting its expectations. The company would compile a final analysis report as soon as possible, and apply for the new drug certificate from domestic and foreign drug authorities in the third quarter, Medigen said in a Taiwan Stock Exchange filing yesterday. Its phase 3 trials were conducted in Taiwan and Vietnam with 3,049 participants ranging from two months old to six years old, Medigen said. The company enrolled its first participant for