Now that the Lunar New Year holiday is over, the time has come to begin another year of hard work. In times like this, people often bid farewell to the past year and embrace the new year with infinite hopes. This is especially the case here, where the path to recovery from the economic slump and the political chaos during the previous year can hardly be described as smooth-sailing.
This year will be critical. The consensus in the country is that the worst days are over. But, having been in a rock bottom for so long, everyone is eager to know how much recovery can be expected.
In 2001, the nation had a negative economic growth for the first time. It signified both the existence of a crisis and an opportunity for economic revival. Moreover, it sent a warning message -- don't take economic growth as an inevitability.
If the government understood that the roots of the problems are the inter-party rivalry and "China fever" and respond with the appropriate remedial policies, the nation can surely rise to the top again as a regional economic power.
Last year's economic performance was barely acceptable. Things are, however, looking better for this year because the global economy is beginning to improve. Moreover, the Directorate General of Budget, Accounting and Statistics estimates that the nation's economic growth this year can reach 3.38 percent. The Global Insight forecasts that the figure could reach 4.2 percent while the IMF predicts 4 percent. All of the nation's research institutions also made optimistic forecasts of growth.
In addition, by the end of last year, the unemployment rate had slowly begun to decline, while exports have remained active. With the help of a number of government measures designed to revive the economy and increase employment, a good economic performance is expected this year.
There are still some major dangers. While the government may have vowed to make major economic reforms, it has repeatedly run into difficulties on the policy-implementation level. This is especially true of cross-strait economic and trade policies.
In the last year the nation's excessive economic reliance on China has worsened. The government caved in on the all important issue of open up for China investments. It has, in principal, approved the Taiwan Semiconductor Manufacturing Co's investment plan for 8-inch wafer fabs in China. Once the plan is officially approved, the high-tech industries will predictably begin an exodus to China, leading to a total collapse of the industries at home. The cross-strait migration of labor-intensive industries already created a serious unemployment problem.
A thriving economy is the only mean by which the nation can survive. Some of the challenges involve international factors beyond the government's control -- such as a war with Iraq. However, other challenges, which involve factors at home and cross-strait relations, can be controlled and the government must stick to its principals in order to make breakthroughs.
The active opening policy for China investments and the opening up of indirect cross-strait chartered flights were some of the major mistakes of last year. Hopefully such mistakes can be avoided this year.
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