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Economic indicator flashes 'green' signal for final month of '13

TAIPEI, Taiwan -- The economic monitoring indicator flashed the "green" signal in December last year, signaling a stable economy for the first time in the past six months, according to a report released by the National Development Council (NDC) yesterday.

The monitoring indicator had flashed the "yellow-blue" signal, representing a transitional economy, for five consecutive months. The last time it flashed the "green" signal was in June last year.

Yesterday was the first time the NDC held a press conference to release the monitoring indicator signal, which had been released by the Council for Economic Planning and Development. The council was recently integrated into the NDC as part of the government's restructuring effort.

December's total score grew three points to 24. Among nine components, four showed improvement. Individual light signals for the industrial production index and the Taiwan Institute of Economic Research (TIER) manufacturing sector composite indicator moved from "yellow-blue" to "green" in December. Imports of machineries and electrical components changed from "green" to "yellow-red." The index of producer's shipment for manufacturing improved from "blue" to "yellow-blue."

The imports of machineries and electrical components index grew from 5.2 in November to 18 in December. About half of the investment growth came from the semiconductor industry, the NDC noted.

Optimism Over 2014 Economy

NDC's Chief Secretary Kao Shien-quey (高仙桂) expressed optimism regarding this year's economic outlook. While the economy experienced slow recovery last year, the U.S. and Europe are leading the world in this year's recovery, Kao said.

Strong private investment in 2014 will drive economic growth this year. Private investment started to climb in 2013, and the NDC said that this momentum is expected to continue into this year. There are signs that the economy is on track for recovery from the bottom, Kao said, adding that she expects the "green" signal to last for the next couple of months.

The Free Economic Pilot Zone project recently launched by the government is also expected to drive business investment this year, Kao said, adding that increased revenues may contribute to pay raises, which will drive private consumption, resulting in economic growth.

With revised data, the composite leading index stood at 104.48, up 0.51 percent from November. The leading index has grown for 16 consecutive months, the NDC noted. With revised data, the coincident index was pegged at 103.27, up 0.62 percent from November. The lagging index registered at 99.56, down 0.73 percent from the previous month.

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