The IMF on Tuesday lowered Taiwan’s GDP growth forecast by 0.7 percentage points to 2.1 percent this year amid an ongoing global economic slowdown.
The IMF’s World Economic Outlook report also projected that Taiwan’s consumer price index (CPI) would rise 1.9 percent this year, well below the global average of 7 percent.
The IMF forecast an unemployment rate of 3.7 percent in Taiwan this year and next year.
Photo: Ritchie B. Tongo, EPA-EFE
After the report was issued, the National Development Council (NDC) said that the government had adopted an expansionary fiscal policy to add momentum to an economic rebound.
The expansionary fiscal policy included increasing the government’s budget to NT$2.7 trillion (US$88.51 billion) this year, up 19.5 percent from last year, including an additional NT$700 billion to fund public infrastructure projects, the council added.
Meanwhile, the government has also used NT$141.65 billion in last year’s surplus tax revenues to fund NT$6,000 rebates to Taiwanese and eligible foreign residents to help stimulate domestic demand, the council said.
With the government’s special budgets forecast forecast to add 0.35 to 0.45 percentage points to GDP, the nation could achieve economic growth of 2.5 percent this year, the council said, citing Directorate-General of Budget, Accounting and Statistics figures.
The IMF report forecast that global economic growth would slow to 2.8 percent this year from 3.4 percent last year, before rising to 3.0 percent next year.
Global inflation would decrease, although more slowly than initially anticipated, from 8.7 percent last year to 7 percent this year and 4.9 percent next year, the report said.
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