Taiwan's wealth gap likely to narrow in 2010: president

Based on the significant improvements in the fundamentals of the domestic economy, “we believe the wealth gap will shrink in 2010 from 2009,” he said.

According to the Directorate General of Budget, Accounting and Statistics (DGBAS), the average annual disposable income of Taiwan's top 20 percent income-earning households was 6.34 times that of the bottom 20 percent in 2009.

This represented a bigger wealth gap than in 2008, when the difference was a factor of 6.05.

The public has been urging the government to address the problem.

In 2009, Taiwan's average annual disposable income in the richest group of families was NT$1.79 million (US$56,085), compared to NT$282,000 for those in the poorest bracket, according to the DGBAS.

Addressing a commencement ceremony for a 2010 national affairs class held by the Cabinet, Ma said the wealth gap widened to a record 6.39 in 2001, when the local economy contracted 1.65 percent from the previous year amid a financial meltdown in Asia.

However, Taiwan's income distribution improved in 2002, recording a wealth gap of 6.16, as the island's gross domestic product (GDP) rose 5.26 percent, Ma said.

This year, Taiwan's economy is expected to grow 8.24 percent, much more than the 5.26 percent recorded in 2002, therefore, the income distribution for this year is expected to improve accordingly, he said.

In August, the DGBAS raised its forecast for Taiwan's 2010 GDP growth to 8.24 percent from its previous estimate of 6.14 percent, after Taiwan recorded a 13.71 percent and 12.53 percent year-on-year increase in GDP in the first and second quarters, respectively.

Last year, Taiwan's GDP shrank 1.91 percent amid a global financial crisis.

Meanwhile, Ma said the local job market is also expected to improve, starting September, on the extended economic momentum. The unemployment rate in June and July rose slightly to 5.16 percent and 5.20 percent, respectively, from May's 5.14 percent, as first-time jobseekers entered the market in the graduation season.

Taiwan recorded its highest ever jobless rate of 6.13 percent in August 2009.

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