Three current and former members of Taiwan’s central bank board are calling for an overhaul of its currency policy, saying that efforts to tamp down on the New Taiwan dollar’s appreciation are increasingly having a negative effect on the economy.
Board members Li Yi-ting (李怡庭) and Chen Shiu-sheng (陳旭昇), and ex-member Wu Tsong-min (吳聰敏), have coauthored a book with writer Ariel Chen (陳虹宇) to be published next month.
The authors acknowledge that a devalued currency might have been beneficial to Taiwan’s economic growth in the past, but it has also driven up costs of imported materials and equipment, according to an excerpt of the book.
That has inhibited the incentives for businesses to move up the value chain, keeping them tied to a low-cost production model, they wrote.
For the two decades former central bank Governor Perng Fai-nan (彭淮南) was at the helm, from 1998 to 2018, the central bank closely managed the level of the NT dollar, ensuring it did not appreciate beyond NT$28.50 to the greenback. He also oversaw a more than 440 percent increase in Taiwan’s foreign reserves.
The central bank’s huge reserves have distorted its decisionmaking processes, the authors wrote.
The monetary authority inevitably has to consider the effects of any interest-rate decisions on the bank’s balance sheet, rather than focusing purely on what would be best for the economy, they wrote.
In response to queries, central bank Deputy Governor Yen Tzung-ta (嚴宗大) said that it would be “more appropriate to respond after reading the whole book.”
The authors lay out what they see as the long-term damage caused to the economy by Perng’s rigid and staunchly defended policies. Under central bank Governor Yang Chin-long (楊金龍), who assumed his role three years ago, the bank has eased its grip on the currency and been more open about its intervention in foreign-exchange markets.
The authors proposed three main areas of reform: strengthening the bank’s independence and oversight of its reserves, improving transparency and accountability and reforming the bank’s decisionmaking process on monetary policy.
The book concludes with the authors saying they hope the central bank will implement their recommended changes, which they predict would gradually improve the problems caused by Taiwan’s monetary policy over the past 20 years.
Taiwan’s rapidly aging population is fueling a sharp increase in homes occupied solely by elderly people, a trend that is reshaping the nation’s housing market and social fabric, real-estate brokers said yesterday. About 850,000 residences were occupied by elderly people in the first quarter, including 655,000 that housed only one resident, the Ministry of the Interior said. The figures have nearly doubled from a decade earlier, Great Home Realty Co (大家房屋) said, as people aged 65 and older now make up 20.8 percent of the population. “The so-called silver tsunami represents more than just a demographic shift — it could fundamentally redefine the
The US government on Wednesday sanctioned more than two dozen companies in China, Turkey and the United Arab Emirates, including offshoots of a US chip firm, accusing the businesses of providing illicit support to Iran’s military or proxies. The US Department of Commerce included two subsidiaries of US-based chip distributor Arrow Electronics Inc (艾睿電子) on its so-called entity list published on the federal register for facilitating purchases by Iran’s proxies of US tech. Arrow spokesman John Hourigan said that the subsidiaries have been operating in full compliance with US export control regulations and his company is discussing with the US Bureau of
Businesses across the global semiconductor supply chain are bracing themselves for disruptions from an escalating trade war, after China imposed curbs on rare earth mineral exports and the US responded with additional tariffs and restrictions on software sales to the Asian nation. China’s restrictions, the most targeted move yet to limit supplies of rare earth materials, represent the first major attempt by Beijing to exercise long-arm jurisdiction over foreign companies to target the semiconductor industry, threatening to stall the chips powering the artificial intelligence (AI) boom. They prompted US President Donald Trump on Friday to announce that he would impose an additional
Pegatron Corp (和碩), a key assembler of Apple Inc’s iPhones, on Thursday reported a 12.3 percent year-on-year decline in revenue for last quarter to NT$257.86 billion (US$8.44 billion), but it expects revenue to improve in the second half on traditional holiday demand. The fourth quarter is usually the peak season for its communications products, a company official said on condition of anonymity. As Apple released its new iPhone 17 series early last month, sales in the communications segment rose sequentially last month, the official said. Shipments to Apple have been stable and in line with earlier expectations, they said. Pegatron shipped 2.4 million notebook
RSS