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TIER raises 2014 economic growth forecast for Taiwan

TAIPEI -- The Taiwan Institute of Economic Research (TIER), one of Taiwan's leading think tanks, on Friday raised its forecast for Taiwan's economic growth in 2014, citing an improving global economy.

The Taipei-based think tank said Taiwan's economy will grow 3.17 percent this year, 0.06 percentage points higher than the 3.11 percent it had forecast last November.

The forecast was raised in light of the stable economic recovery in major developed countries such as the United States, Europe and Japan, the think tank said.

Taiwan's general economic performance will thus be better than in 2013, it predicted.

TIER President David Hong said, however, that the global situation could be affected by a number of factors such as the timing and scale of the United States' monetary policy, Japan's financial management, and China's economic promotion and transformation.

"There are still uncertainties ahead of us," he warned.

Hong said at a press conference that Taiwan should speed up its market liberalization in line with the global trend to maintain its competitiveness.

Taiwan's 2014 fixed capital formation, which includes public and private investments, is expected to grow 3.24 percent, the think tank said, raising its forecast 0.4 percentage points.

It adjusted its prediction for Taiwan's private consumption growth from 1.89 percent to 2.23 percent, and for the local consumer price index increase from 1.04 percent to 1.11 percent.

"We're cautiously optimistic," said Gordon Sun, director of TIER's macroeconomic forecasting center.

Even with the slight increase, TIER's forecast for Taiwan's gross domestic product growth rate is still below the 10-year average of 4 percent, he noted.

"Once the bullish outlook can be maintained throughout the first quarter, we might be more upbeat," Sun said.

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