The nation’s wealth gap is expected to narrow this year amid a strong rebound in the local economy, which is likely to grow 8.24 percent from last year, President Ma Ying-jeou (馬英九) said yesterday.
Based on significant improvements in the fundamentals of the domestic economy, “we believe the wealth gap will shrink in 2010 from 2009,” he said.
According to the Directorate-General of Budget, Accounting and Statistics (DGBAS), the average annual disposable income of Taiwan’s top 20 percent of income-earning households was 6.34 times that of the bottom 20 percent last year.
This represented a bigger wealth gap than in 2008, when the difference was a factor of 6.05, with the public urging the government to address the problem.
Last year, Taiwan’s average annual disposable income in the richest group of families was NT$1.79 million (US$56,085), compared with NT$282,000 for those in the poorest bracket, the DGBAS said.
Addressing a commencement ceremony for this year’s national affairs class held by the Cabinet, Ma said the wealth gap widened to a record 6.39 in 2001, when the local economy contracted 1.65 percent from the previous year amid a financial meltdown in Asia.
However, Taiwan’s income distribution improved in 2002, recording a wealth gap of 6.16, as Taiwan’s GDP rose 5.26 percent, Ma said.
This year, Taiwan’s economy is expected to grow 8.24 percent, much more than the 5.26 percent recorded in 2002, so the income distribution for this year should improve accordingly, he said.
Last month, the DGBAS raised its forecast for this year’s GDP growth to 8.24 percent from its previous estimate of 6.14 percent after Taiwan recorded a 13.71 percent and 12.53 percent year-on-year GDP increase in the first and second quarters respectively.
Last year, Taiwan’s GDP shrank 1.91 percent amid the global financial crisis.
Meanwhile, Ma said the local job market would also improve, starting this month, on the extended economic momentum. The unemployment rate in June and July rose slightly to 5.16 percent and 5.20 percent from May’s 5.14 percent as first-time jobseekers entered the market after graduation.
Taiwan recorded its highest-ever unemployment rate of 6.13 percent in August last year.
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