Taipei, Taiwan’s government on Thursday downgraded its forecast for gross domestic product (GDP) growth in 2020, due to the economic impact of the COVID-19 pandemic, according to the Directorate General of Budget, Accounting and Statistics (DGBAS).
The DGBAS said it expects Taiwan’s GDP to grow 1.67 percent in 2020, a downgrade from its earlier forecast of 2.37 percent made in February, but much higher than the global average of -5.5 percent forecast by IHS Markit.
Compared to the global financial crisis of 2009, when global GDP growth was -1.7 percent and Taiwan’s GDP growth -1.6 percent, Taiwan’s economy has become much more resilient, said Tsai Hung-kun (蔡鴻坤), deputy head of the DGBAS.
One main reason for this is the large number of companies that have returned to Taiwan in recent years and built manufacturing facilities, thereby expanding Taiwan’s production capabilities, Tsai said.
Another reason is that Taiwan implemented epidemic prevention measures early, which ensured manufacturing activities have not been disrupted, the DGBAS said.
Despite these measures, the COVID-19 pandemic is still impacting Taiwan’s economy and the DGBAS cut its 2020 growth forecast for Taiwan’s merchandise and services exports by 4.83 percentage points to -3.1 percent.
The growth forecast for private consumption has been downgraded by 1.82 percentage points to -0.24 percent, the lowest in Taiwan since 2009, and for fixed capital formation by 1.79 percentage points to 2.31 percent, the DGBAS said.
Source: Focus Taiwan News Channel