Taiwan has been named the world’s top economy for price competitiveness, alongside Hong Kong and Singapore, in the latest economic outlook produced by the Washington-based International Monetary Fund.
“This performance can be attributed to ROC government policies aimed at maintaining prices and checking inflation,” officials from the Council for Economic Planning and Development said Oct. 11.
Taiwan has improved significantly in this part of the survey in recent years, moving up from 17th, 16th and seventh out of 142 economies in 2008, 2009 and 2010, respectively.
CEPD officials said that emerging Asian economies are highly vulnerable to changes in international commodity prices given their heavy reliance on oil imports. This means that without effective exchange rate and price control measures, import-induced inflation can easily get out of hand.
“Although Taiwan is benefiting from lower commodity prices at present stemming from a weaker than expected global economic recovery, growing demand from emerging markets, climate change and political unrest in North Africa and the Middle East is expected to keep driving up prices,” officials said.
Global Insight, an economic forecasting firm, supports the CEPD’s view, predicting an increase of 5.6 percent in consumer prices for the remainder of 2011 in the Asia-Pacific region, excluding Japan. The Asian Development Bank holds the same view, having raised its consumer price index forecast for Asia’s emerging countries to 5.8 percent in September.
“The government will remain vigilant,” officials said, “keeping a close eye on prices at home and abroad while implementing timely measures to rein in inflation.”
Photo by _Zinni_
Meg Chang
Taiwan Today