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Published Date: 2020-07-01
Moody’s Investors
Service is projecting that Taiwan’s economic growth will reach only 0.2% in
2020. That’s as the COVID-19 pandemic hits Taiwanese exports. However, Moody’s
expects Taiwan’s economy to rebound next year, with growth of about 3.7%.
Moody’s analyst
Michael Higgins says that Taiwan’s swift recovery will be aided by continued
investment from Taiwanese companies overseas and rise in demand for Taiwan’s
high-quality electronics.
Moody’s says
Taiwan’s open trade and its close trade ties with China have left it vulnerable
to effects of the US-China trade war. However, it also says that Taiwan could
benefit from a movement away from reliance on China as a trade partner. This is
because Taiwan and China export similar products. Also helping Taiwan are its
high competitiveness and technological prowess. Moody’s predicts that the
government will likely pursue policies to strengthen Taiwan’s competitive edge
internationally.
Moody’s says it
could upgrade Taiwan’s credit rating if the country can strengthen its economic
growth potential to offset the drag from its aging population while also
improving its relations with China.