Experts warn of barriers to Ma's stimulus pledge
By Ted Chen, The China Post
January 2, 2014, 12:14 am TWN
TAIPEI, Taiwan -- Following President Ma Ying-jeou's New Year's Day address promising sweeping structural overhauls and reforms to stimulate economic recovery, a number of scholars and economists at various enterprises stated that Taiwan faces a myriad of challenges before conditions may improve.
According to Liang Guo-yuan (梁國源), economist and chief of Yuanta-Polaris Research Institute (元大寶來綜合經濟研究院), the predominant cause of Taiwan's anemic economic growth are its inefficient utilization of resources and a growing margin in trade flows. Taiwan is most threatened by a shift in cross-strait commercial relations, which could turn a synergistic collaboration into a competitive rivalry. Similarly, Taiwan is lagging more and more behind regional trading competitor South Korea, said Liang. The government must first tackle the causes of Taiwan's tepid momentum in economic growth, said Liang, adding that increasing average income levels should be of the highest priority in order to stimulate consumer spending and investments and create tangible improvements.
In addition, the ability for Taiwan's industries to compete globally is largely hampered by the local education system, which has thus far failed to supply businesses with sorely needed human resources, said Liang. In comparison to China and South Korea, Taiwan's progress in seeking regional trade agreements is lacking, and the nation may be at risk of marginalization because of its absence from regional trade blocs, said Liang.
Taiwan must ramp up efforts toward securing a place within regional trade organizations and accords in order to improve competitiveness, said Yin Nai-ping (殷乃平), a finance professor at National Chengchi University. Internally, Taiwan is in dire need of structural reform across major sectors, said Yin, who added that China made tremendous progress in its transition to an economy with a greater reliance on domestic consumption, as opposed to its export-oriented approach of the past.