Even with more than NT$450 billion (US$14.85 billion) in financial aid from the Executive Yuan’s expanded relief package, local tourism-related businesses are unlikely to rebound from the COVID-19 pandemic any time soon, a central bank report released last month said.
The NT$1.05 trillion relief package includes NT$472 billion in financial assistance for tourism and transportation sectors, such as airlines, hotels, travel agencies, taxis and tour buses.
However, a March 20 central bank report said that the effects of the COVID-19 pandemic on global and domestic economies are far greater than that of the 2002-2003 SARS epidemic, despite any benefits from delayed purchases after the crisis ends.
Photo: CNA
Tourism-related industries would be hardest hit, with widespread travel restrictions and bans on mass gatherings imposed by governments worldwide.
“It is difficult to say that there will be a V-shaped recovery at the moment, as it all depends on the development of the pandemic,” the report said.
Taking the SARS epidemic that broke out in late 2002 as an example, the bank said that the local economy rapidly lost momentum in the second quarter of 2003 after the disease took its toll on global activity.
Over that three-month period, travel on international flights to and from Taiwan fell 69.5 percent and the nation’s economy contracted 1.15 percent in 2003 as a result of the knock-on effects of SARS, the bank said, adding that the effects of COVID-19 are more severe.
Passenger load factors in February on routes between Taiwan and China, Hong Kong and Macau fell by more than 90 percent, compared with their levels in December last year, the report said, citing Tourism Bureau statistics.
At the same time, taxi drivers had 30 percent fewer passengers, while tour bus operators also experienced a 17.2 percent decline in daily operations from January, the report said.
The central bank said that the restaurant and beverage sector typically has the highest GDP ratio from the tourism industry, while tour agencies, hotels, and car rental and air transportation companies also earn a noticeable portion of their incomes from it.
Therefore, as domestic and foreign tourists’ travel activities stagnate in Taiwan, tourism-related businesses would face greater difficulties, the bank said.
Due to Taiwanese’s strong interest in traveling abroad, coupled with Beijing’s ban on independent tourists to Taiwan from Aug. 1 last year, Taiwan registered travel deficits of US$6.1 billion last year, a new high, central bank data showed.
However, the travel deficits would likely shrink this year, because of COVID-19, the bank said.
Real estate agent and property developer JSL Construction & Development Co (愛山林) led the average compensation rankings among companies listed on the Taiwan Stock Exchange (TWSE) last year, while contract chipmaker Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) finished 14th. JSL Construction paid its employees total average compensation of NT$4.78 million (US$159,701), down 13.5 percent from a year earlier, but still ahead of the most profitable listed tech giants, including TSMC, TWSE data showed. Last year, the average compensation (which includes salary, overtime, bonuses and allowances) paid by TSMC rose 21.6 percent to reach about NT$3.33 million, lifting its ranking by 10 notches
SEASONAL WEAKNESS: The combined revenue of the top 10 foundries fell 5.4%, but rush orders and China’s subsidies partially offset slowing demand Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) further solidified its dominance in the global wafer foundry business in the first quarter of this year, remaining far ahead of its closest rival, Samsung Electronics Co, TrendForce Corp (集邦科技) said yesterday. TSMC posted US$25.52 billion in sales in the January-to-March period, down 5 percent from the previous quarter, but its market share rose from 67.1 percent the previous quarter to 67.6 percent, TrendForce said in a report. While smartphone-related wafer shipments declined in the first quarter due to seasonal factors, solid demand for artificial intelligence (AI) and high-performance computing (HPC) devices and urgent TV-related orders
Prices of gasoline and diesel products at domestic fuel stations are this week to rise NT$0.2 and NT$0.3 per liter respectively, after international crude oil prices increased last week, CPC Corp, Taiwan (台灣中油) and Formosa Petrochemical Corp (台塑石化) said yesterday. International crude oil prices last week snapped a two-week losing streak as the geopolitical situation between Russia and Ukraine turned increasingly tense, CPC said in a statement. News that some oil production facilities in Alberta, Canada, were shut down due to wildfires and that US-Iran nuclear talks made no progress also helped push oil prices to a significant weekly gain, Formosa said
MINERAL DIPLOMACY: The Chinese commerce ministry said it approved applications for the export of rare earths in a move that could help ease US-China trade tensions Chinese Vice Premier He Lifeng (何立峰) is today to meet a US delegation for talks in the UK, Beijing announced on Saturday amid a fragile truce in the trade dispute between the two powers. He is to visit the UK from yesterday to Friday at the invitation of the British government, the Chinese Ministry of Foreign Affairs said in a statement. He and US representatives are to cochair the first meeting of the US-China economic and trade consultation mechanism, it said. US President Donald Trump on Friday announced that a new round of trade talks with China would start in London beginning today,
RSS