Sat, Dec 23, 2023 page12

• GDP to grow 3.02% next year: Academia Sinica

  • Staff writer, with CNA
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  Taiwan’s GDP should grow 3.02 percent next year due to higher exports driven by demand for emerging technologies such as artificial intelligence applications, Academia Sinica, the nation’s top research institute, said on Thursday.

  The nation’s economy is to benefit from rising private investment led by a rebound in exports of information and electronic devices, as well as continued growth in private consumption, the institute said.

  Should the forecast be accurate, it would top the 1.34 percent GDP growth anticipated by the institute for this year.

  

  Lin Chang-ching, an adjunct research fellow at Academia Sinica’s Institute of Economics, attends a media briefing in Taipei yesterday.

  Photo: Hsu Tzu-ling, Taipei Times

  The institute has twice revised its forecast for this year’s growth downward since projecting 2.41 percent real growth forecast for the year at the end of last year.

  It revised that to 1.56 percent in July and then to 1.34 percent yesterday, citing a weakened global economy affected by fragile demand from end-users and bloated inventories that are still being drawn down.

  The institute’s forecasts were slightly more cautious than those made by the government.

  The Directorate-General of Budget, Accounting and Statistics (DGBAS) last month forecast that the nation’s GDP would grow 1.42 percent this year and 3.35 percent next year.

  Lin Chang-ching (林長青), an adjunct research fellow at Academia Sinica’s Institute of Economics, said that exports, investment and consumption are all expected to drive the nation’s GDP growth next year, when the “local economy will see the spring arrive as the snow melts.”

  Next year, the nation’s merchandise and service exports are expected to grow 6.23 percent after a 4.39 percent decline anticipated for this year, while imports are to grow 8.03 percent next year, compared with a predicted drop of 5.07 percent this year, he said, citing research by his department.

  Solid demand for emerging tech applications and consumer electronics should spark the rebound in exports next year, he said.

  Investment would also be higher as IT and electronics manufacturers invest in expanding capacity to meet stronger demand and the private sector invests more in green energy development to cut carbon emissions, he said.

  Because of those factors, Academia Sinica forecast the nation’s private investment would grow 3.05 percent next year after a 9.70 percent decline anticipated for this year, with fixed capital formation to rise 4.23 percent next year from an anticipated 7.35 percent decline this year.

  Academia Sinica also expected the nation’s private consumption to grow 3.01 percent next year, after an expected 8.32 percent increase this year, anticipating that greater cross-border travel, a 4.05 percent hike in the minimum wage and a 4 percent wage hike for government employees would boost spending.

  While the nation’s economy would improve next year, the global economy remained vulnerable to uncertainties that could affect local growth, including downside risks of the Chinese economy and escalating trade tensions between Washington and Beijing, Lin said.

  When asked about a move by China to suspend preferential tariff treatment for imports of 12 Taiwanese petrochemical products starting on Jan. 1, he said the impact would be limited.
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