Taiwan Today

President asks economic efforts President Chiang Ching-kuo directed government agencies to strive for attainment of the 7.5 per cent economic growth rate projected for this year. The President said an en­thusiastic attitude is required in undertaking construction projects, while an industrious and frugal spirit is needed to improve productivity and lower production costs. After a briefing on economic conditions, the President said oil price hikes and worldwide reces­sion have made some setbacks inevitable. President Chiang said the high quality of ROC products can establish the country's reputation and help enlarge markets for in­dustrial and agricultural products. The President asked govern­ment officials to explore water resources and construct more reservoirs in southern Taiwan, where drought has led to agriculture losses. Inflation may be halved in 1981 Price stability will be the top task of the government this year, Yu Kuo-hua, chairman of the Council for Economic Planning Development, said. He set a goal of halving infla­tion to less than 10 per cent. The government will import food grains and take other measures to assure price stability, Yu added. Economic growth is targeted at 7.5 per cent with a per capita gross national product of US$2,622, Yu reported. Last year's figures were 6.7 per cent and US$2,282. Trade goals are US$24,040 million for exports and US$24,130 million for imports, leaving a US$90 million deficit. The government will continue to improve the industrial structure with greater emphasis on tech­nology-intensive industries, Yu said. The industrial growth target has been set at 8.1 per cent. Industrial output will account for 52.3 per cent of the GNP com­pared with 40.6 for services and 1.1 for agriculture. Yu estimated the population will grow by more than 320,000 persons and the labor force will increase by over 170,000. He expects an increase of 2.6 per cent in job placements, keep­ing the unemployment rate at 1.3 per cent. The number of agricultural workers is expected to drop by 20,000 while 80,000 are added in industry and 110,000 in the servi­ces. Industrial workers will ac­count for 42.3 per cent of the work force, service personnel for 39.1 per cent and agriculture for 18.6 per cent. Yu said savings are expected to fall short of investment needs by NT$51.9 billion (about US$1.4 billion). The government will have to seek more foreign and overseas Chinese investments and foreign loans. Government spurs free enterprise The government will keep its administrative interference to the minimum in the nation's eco­nomic development, Premier Sun Yun-suan declared. He told business leaders that the time is ripe for the private sector to play an increasingly important role in economic development. Giving the reins to free enterprise will be more effective than any role of government, he said. Premier Sun urged industry and business to organize more ef­fectively, train more talents and invite experts to bolster trade as­sociations. Last year was difficult, Sun said. Some targets were not reached. But the Premier expressed his appreciation to business and industry for overcoming many adversities. Economic development of the 1970s resulted in higher incomes for the people and the ac­cumulation of wealth, Premier Sun said, and called attention to the rise of young entrepreneurs. Sun said the government played an important part in the early stages of economic develop­ment, as directed by the Principle of People's Livelihood. But as development becomes more complex and limited resources come into view, private entrepreneurs should assume more responsibility, he continued, citing government's need to hand trade con­trols over to private associations. The Premier urged trade associations to prepare to take over some of the functions now carried out by the government. Encouragement of research and development, importing of tech­nology and establishment of a favorable climate for precision industries will still require govern­ment action. Businessmen and scholars backed Premier Sun's proposals. At a seminar sponsored by the United Daily News, Y.C. Wang, chairman of the Formosa plastics group, criticized the government for restricting imports of petrochemicals to protect local manufacturers. He said this has jeopardized the competitiveness of downstream petrochemical products on overseas markets. Wang said government red tape has delayed for more than a year his company's plans to produce plastic bags that can be burned without polluting the atmosphere. Chao Yao-tung, chairman of the China Steel Corporation, said the country must abide by free economic principles. Enterprises with outdated management and production technology should be eliminated so more efficient companies can take their place, he said. Ho Chun-yih, secretary of the Chinese National Federation of Industries, proposed that the gov­ernment transfer some administrative functions to business associations. He mentioned quality inspection, vocational training, export licensing and credit investigation. Loans available to save energy The government has decided to make immediate loans available to manufacturers wishing to im­port or buy local energy-efficient facilities. Loans will come from the Central Bank of China and the Bank of Communications. If the purchase is from abroad, businessmen can apply to the Central Bank. Loans for local equipment will come from the Bank of Communications. Initial applications will go to the Industrial Development Bu­reau for approval. Electric car exports slated Electric cars may be exported soon. "Tsing Hua-5", a car de­veloped by National Tsing Hua University and the Tang Eng Iron Works Company, has aroused interest in foreign countries. A company in Los Angeles plans to buy 250 of the cars be­fore the middle of this year and 2,000 annually thereafter. The price of each car is set at NT$135,000 (about US$3,750). Carrying capacity is 200 pounds and top speed is 75 kph. Eight batteries weighing 300 kilograms will power the car for 110 to 120 kilometers. "Tsing Hua-3" and "Tsing Hua-4" electric cars are used by the Directorate General of Telecommunications of the Ministry of Communications. They were made in 1977 and 1978. Taipower supports nuclear safety The Taiwan Power Com­pany has joined power companies of four other countries as sponsors of the Nuclear Safety Analysis Center in Palo Alto, California. The Nuclear Safety Analysis Center was established after the nuclear power plant accident at Three Mile Island, Pennsylvania. It is trying to assure there will be no repetitions. As a foreign sponsor, the Taiwan Power Company will have access to technical reports, docu­ment archives and computer data. The other sponsors are the United States, France, Japan and Sweden. 80s seen as decade of challenge Professor Wei Eh of National Taiwan University said the rapid economic growth of the Republic of China is unprecedented but that the most challenging decade lies ahead. Per capita income is now 38th among the 160 countries in the world, he said. The United States has per capita income of more than US$10,000, while that of Sweden and Switzerland is US$14,000. "Though we were not quite satisfied with the 6.7 per cent economic growth of last year, it still was a high compared with that of the Republic of Korea, the United States and Japan," he said. He said Red China's per ca­ pita income last year was US$286, the same as that of Taiwan 25 years ago. Teng Hsiao-ping es­timated it could reach US$1,000 in the year 2,000. Even if Red China averages 5 per cent growth compared with its recent 3.4 per cent, it couldn't reach US$1,000 until the year 2003. Construction firms lack stability Construction companies have the worst financial structures among local industries, according to bank credit data for 1979. Debt of construction com­panies was 731.7 per cent of net assets. Debt-servicing ability of construction companies is weak. Their quick assets (liquidity minus inventories and advanced payments) was only 20.7 per cent of liabilities. Gross profits were 9.6 per cent. Leasing companies had the second heaviest debt — 639.8 per cent of assets. Advertising com­panies were third. Airline companies had the strongest debt-servicing capacity. Their proportion of quick assets to current liabilities was 122.4 per cent. Coal mining was second. The restaurant and tourist industry had profits of 78.3 per cent. Then came advertising com­panies, at 59.2 per cent; beverages, 45.8 per cent; petrochemicals, 25.5 per cent; electrical machinery 19.2 per cent; cement, 14.7 per cent; plastic shoes, 14.2 per cent; electronics, 13.7 per cent; and gar­ments, 12.1 per cent. India seeks more trade with Taiwan India wants to expand eco­nomic and trade ties with the ROC. K.N. Modi, president of the Federation of Indian Chambers of Commerce and Industry and leader of a trade mission, said India has no restrictions against the direct import of Taiwan prod­ucts. Formerly many ROC prod­ucts had to be imported through third countries. Trade has grown rapidly, reaching US$37 million in 1978, US$70 million in 1979 and US$110 million in 1980. "Your country is a miracle economy from which we have to draw inspiration," Modi said. Free zone planned at Taichung Harbor The government has selected Taichung Harbor as the site for a free zone. Financial and economic units are working on plans based on a proposal of the Taiwan Provincial Government. The zone will use facilities and land adjoining the harbor. As Taiwan Province is in the center of the Far Eastern area, the zone will be strategically located for the transfer of goods. The Chinese Petroleum Cor­poration plans to set aside NT$180.2 billion (about US$5 billion) over the next decade for expan­sion projects. NT$66.3 billion (about US$1.9 billion) will be used for oil exploration overseas and at home and to begin construction of Taichung port facilities to import liquefied petroleum gas. NT$62.59 billion (about US$1.73 billion) will be spent for a topping unit and two hydro­ desulfurization units in Taoyuan, three hydro-desulfurization units in Kaohsiung and a fourth naphtha cracking plant already under construction. NT$71.35 billion (about US$1.98 billion) will be spent to build 700 gas stations, giant oil tanks, piping, storage and pumping facilities, two 200,000-DWT oil tankers and wharves at Taichung and Suao for handling liquefied petroleum. NT$75 billion (about US$2 billion) will be spent on LPG ships­ and handling facilities in export­ing countries. Million trained workers needed Taiwan will need a million highly trained workers in this decade, according to a 10-year manpower development program approved by the Cabinet. The program envisions an annual requirement of 330,000 new workers. About 17 per cent of jobs will be filled by college graduates. The manpower program has these objectives: - Reduction of population growth to 1.8 per cent annually for the first five years and 1.4 for the second five years. If targets are reached, the population densi­ty of Taiwan would be 564 persons per square kilometer or 2,210 persons per square kilometer of cultivated area by 1989. - Increase in the number of employed workers by 184,000 persons annually for the first five years and 173,000 for the second five years. Attainment of the targets would lower the unem­ployment rate to less than 1.3 per cent.