Central bank Governor Yang Chin-long (楊金龍) yesterday voiced concern that the US might again place Taiwan on its currency watch list, as the nation is falling short of Washington’s standards amid the effects of the US-China trade dispute.
The US Department of the Treasury is to update its semi-annual currency-monitoring list this month and in April next year.
The measures it uses to back currency manipulation charges include a trade surplus of more than US$20 billion, a current-account surplus in excess of 3 percent of GDP and unilateral interventions in currency markets that exceed 2 percent of GDP, Yang said.
Photo: Taipei Times
Taiwan is approaching the first two thresholds, with Taiwanese firms benefiting from shifts in electronics supply chains as businesses respond to tariffs imposed by Washington on Chinese goods, Yang told the Legislative Yuan’s Finance Committee in Taipei.
The trend might deepen if the trade issues escalate further, which would make additional facility relocations and order transfers inevitable, Yang said.
Taiwan had a trade surplus for the year to August of US$29.47 billion, with exports to the US rising 18.7 percent to US$30.2 billion from the same period last year, despite a slowdown in global trade, Ministry of Finance statistics showed.
Major tech firms have shifted production lines home from China, especially those that provide shipments to the US.
Taiwan could be a winner and a victim of trade frictions after registering a US$16 billion trade surplus with the US in the first half of this year, former premier Sean Chen said, citing US government data.
The trade figures might see Taiwan labeled a currency manipulator and punitive tariffs imposed on exports to the US, Chen said.
Yang said that the nation could make the watch list if it fails two tests and labeled a manipulator if it fails all three.
The central bank has kept a balanced current account as of September last year, despite efforts to help stabilize the New Taiwan dollar, Yang said.
“The central bank was a net buyer [of the NT dollar] in May and a seller in June,” Yang told lawmakers without elaborating.
The US put Taiwan on the watch list in 2016 and early 2017, saying that the central bank repeatedly intervened in the foreign-exchange market to support Taiwan’s exports by stopping the local currency from appreciating.
Authorities would pay close attention to the issue and bilateral communications are smooth, Yang said.
Meanwhile, the central bank said that there is no need to cut the interest rate, despite peers worldwide leaning on monetary easing to cope with a global slowdown, with two more rate cuts expected by the US Federal Reserve this year, Yang said.
It is inappropriate for US President Donald Trump to demand rate cuts given the Fed’s independent operations, he said.
‘LOCAL TRANSMISSION’: The nation reported 11 new cases, including seven local infections in the north, the highest daily number of cases since the pandemic began The COVD-19 situation has entered the “local transmission” stage and enhanced disease prevention measures have been implemented until June 8, the Central Epidemic Command Center announced yesterday as it reported six locally transmitted cases with unclear infection sources. The center reported 11 new cases yesterday: four imported cases from India, and seven local infections in northern Taiwan, the highest daily number of cases since the COVID-19 pandemic began. Minister of Health and Welfare Chen Shih-chung (陳時中), who heads the center, said that one of the local infections — case No. 1,201 — is a woman who is a family member living with
SIXTEEN LOCAL: Three COVID-19 infections are linked to a cluster at a gambling house in Yilan County, 10 to a case in New Taipei City and three had unclear sources The Central Epidemic Command Center (CECC) yesterday urged people to increase vigilance and thoroughly practice preventive measures against COVID-19 as it reported 16 locally transmitted cases of the disease. Minister of Health and Welfare Chen Shih-chung (陳時中), who heads the center, said that 21 cases were confirmed in Taiwan yesterday: 16 local cases, four imported cases and one case undetermined. The locally transmitted cases are three linked to a cluster of infections at a gambling house in Yilan County, 10 associated with a previous case in New Taipei City and three with unclear sources of infection. The CECC on Tuesday reported a cluster
TRACING TROUBLE: An infected man who had said that all his children were abroad was found to have a daughter in Kaohsiung who tested positive, the center said The Central Epidemic Command Center (CECC) yesterday reported a new daily record of 29 local COVID-19 cases, including seven cases with unknown sources of infection. Of the 29 cases, 16 are linked to tea houses in Taipei’s Wanhua District (萬華), Minister of Health and Welfare Chen Shih-chung (陳時中), who heads the center, told a news briefing in Taipei. The 16 are tea house workers or visitors, or their contacts, the CECC said. Workers and visitors to the establishments have frequent interpersonal contact, but few protective measures against the COVID-19 pandemic are in place, Chen said, urging those who have been exposed or have
ENFORCING CAUTION: Certain entertainment facilities are to close nationwide to prevent people traveling there from high-risk areas in the north, the center said The Central Epidemic Command Center (CECC) yesterday raised the COVID-19 alert for Taipei and New Taipei City to level 3 in light of surging cases in the two cities. The enhanced disease prevention measures for level 3 are to be implemented until May 28, Minister of Health and Welfare Chen Shih-chung (陳時中), who heads the center, told a morning news conference at the Executive Yuan in Taipei. With 180 locally transmitted cases confirmed yesterday, Premier Su Tseng-chang (蘇貞昌) said that the government must take immediate action to protect the public, referring to measures stipulated in the Communicable Disease Control Act (傳染病防治法). Other counties