October 16, 2015 – If there is one economy that has put the bulk of its eggs in the Chinese basket, it is Taiwan, with nearly 40 per cent of its exports and 57 per cent of its outbound investments going to the Chinese mainland.
But the slowdown of China’s economy is giving impetus to the island’s efforts to diversify away from the Chinese juggernaut and to “internationalise”, as one of its policymakers, Ms Connie Chang, director-general of overall planning at the National Development Council, puts it.
At a briefing last week for foreign journalists, including this correspondent, on a media trip organised by the Foreign Ministry in conjunction with Taiwan’s National Day last Saturday, she admitted that the government “didn’t expect growth to be so bad” this year.
Buffeted by slackening demand from China and Beijing’s devaluation of its currency, which makes Taiwanese exports more expensive, the Taiwanese government had back in August slashed by more than half its growth forecast of 3.78 per cent to 1.56 per cent. Early this month, it warned that the island’s export-reliant economy might not reach 1 per cent growth.
In the IT sector, “we have focused on one market, which is mainland China. That has to change if we are to maintain steady export growth”, said Ms Chang. “We need to be internationalised and liberalised.”