Taipei, Dec. 26 (CNA) The year 2008 is expected to be one of slow economic growth for almost all major economies and Taiwan is no exception with an economic growth rate estimated at 4.23 percent, the head of the Taiwan Research Institute (TRI) said Wednesday.
The estimated economic growth rate for Taiwan is slightly lower than the 10-year average of 4.38 percent and more than one percentage point lower than the expected economic growth rate of 5.29 percent for 2007. The growth in domestic consumption and investment are also limited, said TRI President Liu Tai-ying.
A slowing economy in the United States and higher oil prices are the biggest factors expected to impact Taiwan and the rest of the world in 2008, Liu said at a forum looking into the economic prospects for 2008.
Taiwan's already robust export sector is still expected to grow by more than four percent, but the same cannot be said of domestic consumption and investment given the falling consumer confidence, Liu noted.
TRI estimated a 2.92 percent growth rate in domestic consumption next year, which will be higher than the 2.88 percent growth rate of 2007. The slight increase will result from an increasing labor force participation rate and relatively low unemployment rate as well as the short-term impact of the presidential election, said TRI Vice President Wu Tsai-yi.
The growth rate in private sector investment is expected to be 4.12 percent, lower than the 4.99 percent of 2007, Wu said. The rate will be about the same as the economic growth rate, although in the past it was 1.8 times the economic growth rate, Wu said.
A number of instances of pubic investment have not been passed in the Legislature over the past year after becoming ensnared in the process of environmental evaluation and by protests from environment protection groups, which are hurting the national economy, Wu pointed out.
The global economy will be in a period of adjustment in the first quarter of 2008 due to the impact of the U.S. subprime mortgage crisis and high oil prices, but is expected to be more stable starting in the second quarter, said Wu Chung-hsu, a researcher at Academia Sinica.