Taiwan's premier pushes for economic stimulus bills

  • AseanPlus News
  • Tuesday, 25 Feb 2003

TAIPEI, Taiwan (AP) - Taiwan's legislature opened a new session on Tuesday with Premier Yu Shyi-kun pushing for several bills aimed at spurring the economy and curbing rising unemployment ahead of the 2004 presidential race. 

The proposals were stalled during the last session amid vicious political bickering. Opposition lawmakers accused President Chen Shui-bian's inexperienced administration of failing to come up with effective policies to stimulate the sluggish economy. 

With the approaching presidential elections, Chen _ who plans to run again _ is eager to jump-start the economy and ease worries about growing unemployment. 

Taiwan is recovering from its worst recession in decades. The economy grew 3.54 percent last year, bouncing back from a 2.18 percent decline in 2001. 

In a speech at the session, Yu urged lawmakers to support the proposed economic stimulus measures, which he said are needed to prop up the economy and maintain 3.5 percent growth this year. 

"We hope to create 120,000 jobs to effectively curb the jobless rate,'' said Yu, Taiwan's No. 3 leader. 

The Cabinet has proposed a bill to spend 50 billion New Taiwan dollars (US$1.4 billion) on public projects.  

The government is offering another bill to significantly expand a financial restructuring fund to NT$1.05 trillion (US$30 billion) to help banks write off their non-performing loans. 

"The economy is Taiwan's veins and the financial system is its blood,'' Yu said. 

"Only with a sound financial system can we have healthy industrial and economic development.'' 

The two largest opposition parties, the Nationalists and the People First Party, have blocked the bills, saying spending on public projects would only have a short-term effect on the economy. They have complained that the expanded fund would exacerbate the government's financial woes. 

But during this session, the Nationalist Party has indicated it would support the bills. 

One major worry for the island is an exodus of Taiwanese capital and investment to China in recent years. Many fear that the economy is being hollowed out by its giant communist neighbor. 

"The magnetic effect of China's economy has led to a new phase of competition with us,'' Yu said. "We will cope with it by boosting our competitiveness and turning the threat into an opportunity.'' 

Taiwan and China split amid civil war in 1949, and tensions continue to simmer. 

But Yu said Taiwan would try to "build a framework of peace and stability with the mainland'' as well as "reopen the door to negotiations.'' 

Another bill that has received considerable attention proposes that the government, military and political parties sell their shares in newspaper and broadcasting companies. 

The ruling party has argued that this is essential for the island's democratic reforms. - AP 

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