Taiwan’s economy would grow 3.6 percent this year and 2.5 to 3 percent next year, Standard Chartered Bank Taiwan (渣打台灣) forecast yesterday, saying there are no signs of recession.
The slower GDP growth next year would be due to weakening demand in the US and Europe, even though exports to China would improve from this year, Standard Chartered chief economist Tony Phoo (符銘財) told a news conference.
The US economy is predicted to grow 0.3 percent next year, compared with 2.1 percent this year, and the European economy is forecast to grow 0.4 percent next year, compared with 2.3 percent this year, Phoo said.
Taiwan should continue to relax border controls to attract foreign tourists and boost domestic consumption, Phoo said, citing Thailand’s strong GDP growth on recovering tourism.
Despite the emergence of new variants of SARS-CoV-2, Taiwan has reached a high COVID-19 vaccination rate and can continue to ease its social distancing measures to boost private consumption, he added.
“Strong private consumption should help cushion the damage posed by weaker exports next year. Therefore, we see no signs of recession ahead,” Phoo said.
The central bank is expected to stop raising its policy rates next year after inflation abates, he said.
The bank said slowing exports to China could be a drag on the local economy in the second half of the year, as Chinese consumer demand remains weak amid Beijing’s “zero COVID-19” policy and lockdown measures.
“There is a slim chance that China would abandon its zero COVID-19 policy by the end of this year, as many rural areas support this policy,” Becky Liu (劉潔), a Hong-Kong based strategist at Standard Chartered, told the event via videoconference.
Since February, almost all first-tier cities have seen the virus spread continuously, and almost every day there is a small community facing new lockdown measures, Liu added.
The lockdown measures caused China’s import growth to slow in the first half of this year from a year earlier, she said, adding that the situation is unlikely to improve greatly in the second half.
RECOVERED CONFIDENCE: As market rationality returns, Taiwanese stocks that have lagged behind their US peers might soon catch up, Allianz researchers said Local shares last week defied heavy pressure from China’s military drills in waters around Taiwan, and investors this week are expected to pay attention to earnings results from several tech heavyweights as well as the latest economic data on exports and GDP. The TAIEX closed at 15,036.04 points on Friday, posting a weekly increase of 0.24 percent from 15,000.07 on July 29, Taiwan Stock Exchange data showed. Over the same period, the FTSE TWSE Taiwan 50 Index, which comprises Taiwan’s top 50 stocks in terms of market capitalization, closed up 0.93 percent at 11,750.15 points, while the Formosa Stock Index, which measures
Pharmaceutical start-up AcadeMab Biomedical Inc (研生生醫) said it has been developing a COVID-19 antibody drug, an endeavor not being undertaken by many other Taiwanese pharmaceutical firms. The company was spun off from Academia Sinica’s Institute of Cellular and Organismic Biology in 2020 and has only 16 employees. It has set its sights on the innovative field of the monoclonal antibody treatment of tumors. The start-up began developing antibody drugs in January, after seeing that COVID-19 vaccines could not effectively protect people from new variants of SARS-CoV-2, AcadeMab Biomedical chief strategy officer Pearl Fong (俸清珠) said in an interview with the Taipei Times
FORECAST EXCEEDED: China’s curbs on some Taiwanese goods are unlikely to affect trade given inter-reliance in the electronics industries, a finance ministry official said Exports last month spiked 14.2 percent to US$43.32 billion, the second-highest increase on record and the 25th consecutive month of gains, driven by global demand for electronics used in high-performance computing and vehicles, the Ministry of Finance said yesterday. The ministry expects the trend to sustain this month and beyond, although the pace could slow due to inventory corrections for laptops, smartphones and other consumer electronics. “The July results proved stronger than expected despite rising fears over economic uncertainty,” Department of Statistics Director-General Beatrice Tsai (蔡美娜) said, adding that a high sales season in the West and stabilized COVID-19 infections in China
Government officials and business representatives yesterday participated in a groundbreaking ceremony at the Nanzih Technology Industrial Park (楠梓科技產業園區) in Kaohsiung, where Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) is to construct a 12-inch wafer plant. The 238-hectare park sits on the former site of a naphtha cracking plant owned by state-owned oil refiner CPC Corp, Taiwan (台灣中油). Thirty hectares of the first phase of development are reserved for TSMC’s planned factory, while the second phase is to be occupied by international semiconductor material and equipment companies, the Executive Yuan said in a statement yesterday. “The park will be connected with Tainan Science Park