Taiwan’s economy is likely to grow at a rate of 6.07 percent this year and 4.05 percent next year, driven by healthy exports and private investment, as the world learns to coexist with variants of SARS-CoV-2, the Taiwan Research Institute (TRI, 台灣綜合研究院) said yesterday.
Its projection of 6.07 percent is higher than its July forecast of 5.12 percent, as COVID-19 and containment measures continue to drive a digital transformation worldwide and boost demand for Taiwan-made electronics, the institute said.
People around the world should eventually become used to living with the virus — resuming normal business operations and private consumption — as the virus mutates.
Photo: Allen Wu, Taipei Times
The Omicron variant of SARS-CoV-2 might not pose as serious a threat to the global economy as other variants, such as Delta, did, institute founder Liu Tai-ying (劉泰英) told a seminar in Taipei.
People might come to treat the coronavirus like the flu, receiving regular vaccine boosters to prevent infection or ease symptoms, Liu said, adding that Taiwanese have joined in local travel and other activities after months of self-imposed isolation to help curb a local outbreak.
The trend should energize private consumption, which was a drag on GDP growth in the second and third quarters, Liu said.
As of Tuesday, Taiwan’s first-dose vaccination rate reached 78.6 percent, while the fully vaccinated rate hit 64.3 percent.
This quarter, the economy is likely to grow 4.1 percent, up from 3.7 percent in the third quarter, based on private investment and the electricity performance index, which suggests high industrial activity, institute president Wu Tsai-yi (吳再益) said.
The two drivers have compensated for lackluster private consumption this year and should help push economic expansion above 4 percent next year, Wu added.
Exports are likely to rise 16.74 percent this year and 18.54 percent next year, while private investment is expected to rise 18.81 percent this year and 2.45 percent next year, TRI data showed.
The government-backed Invest in Taiwan initiative has achieved the goal of attracting NT$1.5 trillion (US$53.95 billion) in investments ahead of schedule, the institute said, adding that Taipei aims to extend the program, as US-China trade tensions persist and more Taiwanese companies in the overseas market aim to return home.
Private consumption this year is likely to only edge upward 0.06 percent, but might accelerate its GDP contribution next year with a 5.3 percent gain, Wu said.
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