is the economy really performing that badly? it’s been growing 4-5% past few years. and unemployment is low at around 4%; cpi and inflation is stable.
I read this in The Peking Duck blog:
http://www.pekingduck.org/archives/004169.php
The Taiwan Malaise
Time is short so I have to be brief. I just got back from an event sponsored by the Economist at which two excellent speakers discussed Taiwan’s macroeconomic situation, and then related it to more personal issues, such as how the Taiwanese see their futures, how they save their money and how they look at China. What came out of this discussion and the following Q & A was familiar to anyone who’s attended all the American Chamber of Commerce luncheons that I have: Taiwan is in the grip of a spiritual depression, mainly due to its inferiority complex which in turn is due to the long dark shadow Mainland China casts on all of its neighbors.
Again, this is old news. Plenty of people in Hong Kong and Singapore will tell you the same thing. What I got out of today’s session was the realization that much of this malaise might be part of a self-fulfilling prophesy, namely the stubborn belief that Taiwan is doomed to slow down and become irrelevant as China grows. Now, there’s plenty of evidence to show that this is partly true, but also plenty of counter-evidence to show the situation is not nearly so dire as those on the street believe. Taiwan’s forex reserves are the third or fourth highest in Asia (depending what week you look); it’s one of the world’s leaders in foreign investment; the wealth here is nothing to sneer at; and despite all the doom and gloom, Taiwan’s GDP has been growing at a respectable 4.1 percent a year. Not orgasm-inducing numbers, but nothing to weep over, either.
And yet, talk to anyone here and there is a tone of resignation and reticence. Taiwan’s glory days are over. The only place to be is China. Taiwan’s markets can only contract, including its job market. And yet, even in the face of downsizing and all kinds of pressures brought on by increased globalization, most of the multinationals here are doing quite well. No, not as spectacularly as some are doing in the PRC, but not so poorly as to merit swallowing the hemlock. This is still an exceptionally vibrant economy, unvexed by inflation or rampant corruption. (No, I’m not saying there’s no corruption in the government, only that the corruption that there is doesn’t drasticaly affect people’s lives and pocketbooks as in places like China and Indonesia and the Philippines.)
One of the speakers said a lot of the misery is caused by today’s political mess, and that nearly everyone agrees that 2008 will be “the magical year” when optimism once again surges in Taiwan. And he might be right; the animosity toward Chen in particular and politicians in general right now is so ripe you can smell it. If that’s what will make the diference, then I hope 2008 comes as fast as possible (especially since that’s the year Bush, too, gets the heave-ho).
It’s just too bad that so manyTaiwanese today see only bleakness in the cards, and that, at least according to one speaker, they then use this bleakness to feed a self-fulfilling prophesy of failure. They presume they cannot soar, so they don’t aim high. They presume they can’t have more so they settle for less. They presume the future is a closed book so they cancel their dreams. It’s a sad phenomenon, since the numbers simply do not support such melancholy. Let’s hope the malaise is as temporary as possible, because it’s nothing less than a cancer that creates a chain-reaction of doubt, insecurity and impotency. The malaise is real, even if its cause is not. If the solution is a new leader who can inspire the people and lift them up, I welcome him or her with open arms, no matter which party they belong to.
Michael Turton, whose blog I always read http://michaelturton.blogspot.com/ and who seems like an intelligent person with years of experience in Taiwan and whose posts dont seem that cynical (for a foreigner), follows up with: “Hell yes. I often encounter this among locals. Taiwan is doing very well. Many visitors enjoy it and stay. Almost every aspect of Taiwanese life is improving.”
