Is a 2% Growth Rate Truly Something to Be Proud of?

  Is a 2% Growth Rate Truly Something to Be Proud of?

China Times Editorial (Taipei, Taiwan)

September 27, 2017

 Translation of an Excerpt

In an address at the opening of the DPP's national party congress, Tsai Ing-wen showed pride and satisfaction with the domestic economic situation, but is Taiwan's economy truly healthy? Is this kind of performance truly something to be happy about? Can we even ask: how much could be attributed to the policies of the Tsai government?

Tsai Ing-wen says that economic prosperity continues to rebound. This is a fact presented in data that cannot be denied, but it is difficult to affirm that government actions on this basis. Because those who somewhat understand the economic situation all know that the so-called rebounding prosperity, as well as the growth rate exceeding past estimates, are the result of the stages of the economic cycle, and not that the government has formulated and implemented many policies beneficial to the economy.

Tsai Ing-wen prided herself on the fact that “the economy’s growth rate exceeded past estimates”; in reality, they were all rather low growth estimates. According to an estimate by the International Monetary Fund, Taiwan has fallen to the bottom of the four little dragons with an economic growth rate below the 3.1% global average. As to the phenomenon that the stock market has climbed above 10,000 points for over a 100 days, breaking a historical record, for this wave of a 10,000 high point in the stock market, one of the important underpinning forces comes from foreign capital that seeks to avoid taxes; market analysts have expressed worries that Taiwan’s stock market "has been denigrated to a haven for speculators."

The Tsai government’s cross-Strait policy has step by step dragged Taiwan's industries into a deep predicament. Industrial circles have leveled a number of criticisms against the Tsai government’s core "five plus two industrial policy," believing it to be a mere plan on paper, even possibly injecting massive resources without enabling industries take root and develop; TSMC Chairman Morris Chang has openly expressed objections. The government’s industrial policy should focus on the new economic infrastructure construction, and not jump onto the field, playing the role of both referee and athlete.

Taiwan's economy should at a minimum return again to a mid-speed of 3%-5% growth, at a par with South Korea and Singapore; that would be something worthy of celebration.  

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