As the benchmark stock index fell below the psychological 7,000-point barrier to hit a 20-month low last week, President Ma Ying-jeou (馬英九) and other government officials aggressively offered rosy outlooks and economic plans in an attempt to restore market confidence.
They said the nation’s economic fundamentals remained sound and that the stock market should rebound once global oil prices fall and international financial markets stabilize.
The nation’s central bank even said on Friday it would provide sufficient liquidity to ensure that the stock market operates normally — a rare move for the monetary authority, as its main task is solving inflation, not saving the stock market.
Meanwhile, Ma said yesterday that the government had secured NT$1.08 trillion (US$35.55 billion) in domestic investment this year, and that the figure may amount to NT$4 trillon over the next three years.
Government officials seem to be struggling to convince investors that things are under control, or that they feel people’s pain amid rising inflationary pressures and bearish economic prospects.
Ironically, some remarks made over the past week seem to have produced the opposite effect, giving the impression that government officials worry more about how to boost public recognition of their competence than anything else.
Of those remarks, perhaps the most self-deceiving and naive were made by Vice Premier Paul Chiu (邱正雄) on Thursday, when he said that some foreign investors had expressed their confidence in Taiwan’s economy since the Chinese Nationalist Party (KMT) came to power in May.
Financial Supervisory Commission Chairman Gordon Chen (陳樹) also said on Wednesday that some foreign institutional investors were still very confident about Taiwan’s stock market, with a European fund revealing that investors in Hong Kong and Singapore were set to raise money to invest in Taiwanese equities.
But these pep talks were undercut by the fact that foreign investors have been saying one thing and doing another.
Taiwan Stock Exchange data show that foreign institutional investors sold a net NT$30.87 billion in local shares last week and have offloaded NT$65.96 billion in local shares so far this month. Moreover, since Ma’s inauguration on May 20, foreign investors have dumped a net NT$188.79 billion in local shares, an almost eight-fold increase on the net amount of NT$23.84 billion sold by their local counterparts over the same period of time.
Government officials also said last week they would set up better communication channels, arguing that their efforts to deal with economic problems had been hampered by difficulties in reaching out to the public.
The real problem, however, is that the Ma government is only paying lip service in its show of sympathy for the public while failing to put enough thought into how to deal with these problems.
Government officials have repeatedly said that the nation’s economic fundamentals are sound and that they genuinely believe the recent plunge is nothing more than a crisis of confidence.
But in the face of complaints from the industrial sector about higher taxes leading to capital outflows, worries from the retail sector over weak domestic consumption — prompting UK garment retailer Marks & Spencer to pull out from the Taiwanese market, as well as the latest credit crisis in the US, where IndyMac Bancorp was seized by federal regulators on Friday after a run by depositors — the government should perhaps ask itself if the problem is not just a lack of confidence, but also the onset of wider economic woes to come.
Trying to force a partnership between Taiwan Semiconductor Manufacturing Co (TSMC) and Intel Corp would be a wildly complex ordeal. Already, the reported request from the Trump administration for TSMC to take a controlling stake in Intel’s US factories is facing valid questions about feasibility from all sides. Washington would likely not support a foreign company operating Intel’s domestic factories, Reuters reported — just look at how that is going over in the steel sector. Meanwhile, many in Taiwan are concerned about the company being forced to transfer its bleeding-edge tech capabilities and give up its strategic advantage. This is especially
US President Donald Trump’s second administration has gotten off to a fast start with a blizzard of initiatives focused on domestic commitments made during his campaign. His tariff-based approach to re-ordering global trade in a manner more favorable to the United States appears to be in its infancy, but the significant scale and scope are undeniable. That said, while China looms largest on the list of national security challenges, to date we have heard little from the administration, bar the 10 percent tariffs directed at China, on specific priorities vis-a-vis China. The Congressional hearings for President Trump’s cabinet have, so far,
For years, the use of insecure smart home appliances and other Internet-connected devices has resulted in personal data leaks. Many smart devices require users’ location, contact details or access to cameras and microphones to set up, which expose people’s personal information, but are unnecessary to use the product. As a result, data breaches and security incidents continue to emerge worldwide through smartphone apps, smart speakers, TVs, air fryers and robot vacuums. Last week, another major data breach was added to the list: Mars Hydro, a Chinese company that makes Internet of Things (IoT) devices such as LED grow lights and the
The US Department of State has removed the phrase “we do not support Taiwan independence” in its updated Taiwan-US relations fact sheet, which instead iterates that “we expect cross-strait differences to be resolved by peaceful means, free from coercion, in a manner acceptable to the people on both sides of the Strait.” This shows a tougher stance rejecting China’s false claims of sovereignty over Taiwan. Since switching formal diplomatic recognition from the Republic of China to the People’s Republic of China in 1979, the US government has continually indicated that it “does not support Taiwan independence.” The phrase was removed in 2022
RSS