Taiwan's Excess Savings Estimated to Hit Record High of NT$1.73 Trillion in 2014

Last year Taiwan's excess savings reached NT$1.57 trillion (US$52.33 billion) with excess savings rate of 10.49%,  and this year the former is estimated to keep growing to hit record high of NT$1.73 trillion (US$57.67 billion) and the latter climb up to 11.15% for a new high since 1988, according to Directorate General of Budget, Accounting and Statistics (DGBAS).

In the 1990s the island's annual excess savings rate ranged between 1.2% and 3.7%, but starting 2000 the percentage has been on an uptrend to rise to more than 10% in the last six years. Economists generally agree that excess savings are idle funds that are under-utilized without benefiting national economic development.

DGBAS indicates that the rapid drop in government investments was the main reason for the sharp rise in excess savings. The annual government investments once reached a peak of over NT$500 billion (US$16.67 billion) and this year such investment value will likely fall to NT$362.5 billion (US$12.08 billion), which may be the lowest ever recorded since 1993.

DGBAS officials say that Taiwan's economy this year may rely more on domestic demand such as private investment and consumption, which yet expected to see a modest annual growth of 4.73% for the former and 2.58% for the latter. (JL)