Taiwan to see public expenditure of NT$1.99 trillion for 2004

Taipei, Dec. 19, 2003 (CENS)--With the government budget for the 10 new public construction projects, Taiwan's public expenditures, including government expenditures and fixed investments by the government and state-run enterprises, are estimated to expand to NT$1.99 trillion (US$58.44 billion at US$1 = NT$34) in 2004.

Ho Mei-yueh, vice chairwoman of the Cabinet-level Council for Economic Planning and Development (CEPD), recently said that domestic consumption and investments would be more active next year and excess savings rate might edge down to 9% from this year's 9.8%. The economic climate for next year will turn "hot inside and warm outside" from this year's "cold inside and hot outside."

While some economic research institutions forecast Taiwan's economic growth in 2004 to be above 4%, CEPD estimate the growth figure at 5%. Of the 5% growth rate, Ho explained, 2.4 percentage points would come from national spending, 2.2 percentage points from inbound investments, and the remaining 0.4 of a percentage point from net foreign demand.

CEPD further forecast that the domestic jobless rate would drop to 4.5% next year. In the same year the employment rate is estimated to increase by 1.6%, and consumer price index (CPI) will edge up 0.7%. These upbeat figures demonstrate the government's determination to improve economy.

Taiwan's jobless rate has stood at above 5% over the past few years because of sluggish economy. The gloomy economic situation resulted in shrinking market demand, causing deflation of consumer prices. With the government's planned expansion of public construction projects, and efforts in promoting exports seen since the second half of the year, Taiwan is expected to enjoy a better economic structure in the coming year. Ho emphasized that the government plans to lower the unemployment rate to 4.5% in 2004 and 4% in 2005.

Taiwan's Public Expenditures (2002-2004) Unit: NT$100M.
	2002	2003 (Estimate)	2004 (Projection)
Government Expenditures	12,327	12,558	12,987
Fixed Investments by Government	4,027	4,064	4,750
Fixed Investments by State-run Enterprises	2,216	2,102	2,134
Total	18,570	18,724	19,871

Source: CEPD