Disappointing export data lowers CIER Growth Report

 Disappointing export data lowers CIER Growth Report

Disappointing export data caused the Chinese Academy of Economic Research to cut its growth for China this year to 1.6% from its April 2.01% forecast.

CIER President Ye Junxian said at a press conference in Taipei yesterday, "Taiwan's economy will struggle to grow by 2% this year due to weak exports."

The finance ministry said earlier this month that exports, the growth driver of the local economy, have contracted annually for the past 10 months and show no signs of recovery anytime soon.

The Taipei-based think tank estimates that exports will fall by 7.13 percent and imports by 9.97 percent this year.

Yeh, another key component of GDP, will also be a stumbling block, projected to drop 1.36 percent this year as companies underperform and unwilling to invest to ease the pain of the economic downturn.

He said private and government spending will be the main force supporting the country's economy.

Weak global demand for Taiwanese products and stock takers has led several research organizations, including CIER, to cut Taiwan's GDP growth forecast for this year to less than 2%.

After forecasting 2.04 percent growth in May, the General Directorate of Budget, Accounting and Statistics will include a downward revision in its growth forecast update next month.

Chu Rong, head of risk management and a business professor at Farglory Life, warned that Taiwan could struggle to maintain 1 percent GDP growth due to weak economic data.

Historically, weak exports have had a negative impact on domestic demand.

Yao Rui, a professor of economics at the Central University, also drew attention by saying that the increase in private consumption was limited.

Analysts said it is yet to be seen how long the health retaliation will last if exports continue.

Yau said that China is an important market for Taiwan's exports and that the slowdown in the Chinese economy has led to competition and lowered Taiwan's expectations for the Chinese market.

CIER expects its customers to double.

1% this year, slightly above the central bank's 2% target. The agency said the market will remain stable, with an unemployment rate of 3.59%.

A think tank said Taiwan's economy will grow by 0.48% in Q2.

The growth, which was 41% in the third quarter, jumped to 6.11% in the fourth quarter as the property reform was completed and the demand for intellectual property increased.