The IMF on Tuesday raised its forecast for Taiwan’s GDP growth this year, as the nation is doing better than most other countries in fighting the COVID-19 pandemic.
Taiwan’s GDP growth this year is expected to stand at zero, the IMF said, a significant upgrade from a 4 percent contraction forecast by the fund in April.
With the global economy gradually moving away from the effects of the pandemic, Taiwan’s economy is expected to recover next year and grow 3.2 percent, compared with an earlier estimate of a 3.5 percent increase, the IMF said.
Photo: Liao Chen-huei, Taipei Times
Despite the upgrade, National Development Council (NDC) Minister Kung Ming-hsin (龔明鑫) late on Tuesday said that the IMF has undervalued Taiwan’s economic strength.
“The IMF appears too cautious about Taiwan’s economy,” Kung said.
The Directorate-General of Budget, Accounting and Statistics (DGBAS) in April forecast that the economy would grow 1.56 percent this year and accelerate to 3.92 percent next year.
The economy grew 0.78 percent in the first half of this year and momentum accelerated in the third quarter on the back of an increase in industrial production and exports, as well as improvements in retail sales, and the food and beverage sector, Kung said, citing DGBAS data.
In addition to the nation’s superior efforts in combating the outbreak of COVID-19, the government’s stimulus measures have served as a driver for economic growth, Kung said.
The local electronics sector has benefited from the global booming “stay at home economy,” which has boosted demand for technology devices, much to Taiwan’s advantage, he added.
“Under such favorable circumstances, Taiwan’s GDP growth is expected to top the IMF’s forecast for this year,” Kung said.
“It is unlikely that we will see only zero economic growth,” he added.
“The IMF’s upgrade is not enough for Taiwan and the country’s economy deserves more study by the IMF,” he said.
The global economy is expected to contract by 4.4 percent this year and grow 5.2 percent next year, the IMF said in its latest World Economic Outlook report.
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