Taiwan raises forecast for 2020 GDP growth rate to 2.54%

Taipei,  Taiwan’s statistics agency has raised its forecast for the country’s economic growth rate this year to above 2 percent because of strong exports.

The Directorate-General of Budget, Accounting and Statistics (DGBAS) on Friday revised the country’s gross domestic product growth rate for 2020 to 2.54 percent, up 0.98 percentage points from its previous forecast made in August.

Tsai Yu-tai (蔡鈺泰), head of the DGBAS’ Department of Statistics, attributed the improved projection to a “much-better-than-expected performance” in exports.

According to Tsai, the DGBAS lifted its growth estimates for each of the first three quarters, with the third quarter seeing the largest increase to 3.92 percent, from a previous estimate of 2.01 percent in August, because of US$6 billion more in exports in the quarter than had been expected.

If the forecast is accurate, the 3.92 percent growth would be the highest growth for any quarter since the second quarter of 2015, Tsai said.

Though strong exports pushed the growth estimate higher, the forecast for investment and private consumption growth in 2020 were both revised lower.

Private consumption is now expected to register a negative growth rate of minus 2.52 percent for the year, worse than the minus 1.44 percent forecast in August, he said.

It had been hoped that domestic consumption would benefit from travel restrictions imposed by governments around the world to fight the coronavirus, forcing consumers to spend more at home.

But Tsai said the boost was weaker than expected — the main reason why the forecast for the private consumption growth rate was adjusted downwards.

The booming export sector, however, has sustained Taiwan’s economy, making it one of the few economies capable of registering positive growth this year amid the fallout from the COVID-19 pandemic, he said.

The DGBAS has also forecast that Taiwan’s economy will grow 3.83 percent in 2021 — down 0.09 percentage points compared with the forecast made in August, he said.

 

Source: Focus Taiwan News Channel

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