Economic recovery suffers setback
Updated: 2009-08-12 05:13
(HK Edition)
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Rescuers load medicine and food aid into a helicopter at the Chishan evacuation center in Kaohsiung county in southern Taiwan yesterday, to help those affected by massive flooding in the region. AFP |
TAIPEI: Typhoon Morakot will drag down Taiwan's economy temporarily because of the massive destruction it wreaked, a private economic think-tank forecast yesterday.
The damage from the storm, which triggered the worst flooding in Taiwan in 50 years, will unavoidably adversely impact the island's economy in the third quarter of this year, particularly in the agricultural and tourism sectors, said Liang Kuo-yuan, president of the Taipei-based Polaris Research Institute.
Liang quoted some companies as predicting that economic losses from the typhoon will reach NT$15 billion ($457.32 million), and that the domestic economy will fall by 0.53 percentage points in Q3 as a result.
However, the outlook for the GDP in the fourth quarter is not necessarily "pessimistic", given that huge governmental funds and resources will be channeled into post-disaster reconstruction efforts, which might rev up economic growth, he said.
"The GDP might register positive growth in Q4 as rehabilitation work kicks off at home and global economies possibly start rebounding," Liang forecast.
Citing the 2006 Hurricane Katrina in the United States and the 2008 killer earthquake in Sichuan province as examples, Liang said that government-initiated reconstruction work in the wake of the natural disasters helped boost local economies and turned the negative growth pressure into a positive.
The rehabilitation work will help generate new demand, investment and employment, he added.
He cautioned, however, that apart from the physical damage caused by typhoon Morakot, there could be mental trauma among disaster victims, a type of damage that would not be reflected in GDP figures.
China Daily/CNA
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(Left): Rescuers and residents of Wutai Township in Pingtung county work together to pull a vehicle out of the mud. CNA (Right): A woman in Tunghsing village of Chiayi county kneels as if in prayer as searchers recover the body of her mother from the mud and rock that buried their home during the typhoon. CNA |
(HK Edition 08/12/2009 page2)