Local economy remains stable in November: NDC

By John Liu ,The China Post

TAIPEI, Taiwan — The economic monitoring indicator flashed green in November, indicating a stable economy, according to a report released by the National Development Council (NDC) yesterday. The economic monitoring score rose one point to reach 25. The leading index fell in November, but not by a big margin. The coincident index, on the other hand, has been rising steadily. They are signs that the economy is on track for ��mild growth,�� the NDC said. Among the nine components that make up the monitoring indicator, two changed signals for the better. Customs-cleared Exports became stable, while Imports of Machineries and Electrical Equipments moved up to a transitional state between stable and blooming. The Industrial Production Index underperformed, however, dipping one point and moving to a stable state. The NDC believes that the global economy will do better in 2015, and this will be a positive for Taiwan’s exports.

Foreign and Domestic Demands Forecasting agencies predicted that the U.S. economy will grow three percent or more in 2015, driving growth in other parts of the world. However, the economies of Japan, Europe and mainland China, are relatively weak.

Global Insight forecast that mainland China will see 7 percent or less GDP growth, which may have an adverse impact on local exports, cautioned Wu Ming-huei (�d����), director of the NDC’s Economic Development Department. With regard to domestic demands, the semiconductor industry is expected to step up efforts in research and development on the next generation of high-end manufacturing processes, which will boost private investments. With improvements to the job market and the approaching shopping season for Chinese New Year, the NDC forecast good momentum for private consumption to continue.

Impacts of Falling Oil Prices Taiwan, as an oil consuming country, has benefited in the wake of tumbling oil prices. Money saved on oil can now be used for other types of purchases. This is a positive for local economy, Wu said. However, for major oil exporters such as Russia, the price plunge may cause a financial crisis for the country and result in wider ramifications around the world.�@ The NDC’s monitoring indicator has flashed green for 10 consecutive months. In response to the media’s question of when Taiwan will move to a yellow-red light, Wu said that it very much depends on the global economy, as Taiwan’s economy heavily relies on exports.

Since every country grows at a different rate, growth rates can cancel each other out, and as a result, the world economy is now in a new ��mediocre�� growth phase. ��Taiwan’s economy will keep growing, but it is likely to proceed in a ‘slow crawl’ way,�� Wu said.