Taiwan - Future trends

Despite the current instability caused by the political realignment in the new administration of President Chen Shui-bian, Taiwan's future remains optimistic. Economic forecasts made by the Taipei-based World Economics Society point to continued growth, estimating that GDP growth over the next 10 years will not fall below 5.5 percent annually. The figure approximates the fluctuations of Taiwan's GDP annual growth performance in recent years: 8.2 percent in 1989, 6.68 percent in 1997, 4.57 percent in 1998, and 5.7 percent in 1999. This means that Taiwan's economy will continue to display stability and expansion, propelled by exemplary performance in the service and manufacturing sectors. Both sectors are expected to perform even better because of technological innovations and improved productivity. Moreover, employment levels and living costs are expected to remain manageable. Taiwan is also likely to benefit from its strategic position in the information technology industry. It aims to be known as the "Silicon Island of East Asia." This goal is not far-fetched since, in 2000, Taiwan ranked third in the world in the production of computer hardware and software, next to the United States and Japan. With its aggressive implementation of its growth plans, Taiwan is likely to attract more foreign businesses to the island and thus become a major international procurement and logistics base. The International Monetary Fund has recognized Taiwan's consistent economic performance by affiliating it with the rest of the world's advanced economies.

Politically, Taiwan's relationship with mainland China is still of major concern. To protect its economic achievement, Taiwan must tread slowly and wisely in setting the direction of its relations with mainland China. It must make sure that the relationship between the 2 territories is based on mutual respect and benefit. With regard to domestic politics, the government must continue to strengthen its democratic institutions.

The government is also taking steps to check the social and environmental impact of its economic programs and policies. Environmental programs focusing on protection and conservation are being implemented across the island in line with President Chen Shui-bian's electoral promises, and research into green technologies is also promised.

Meanwhile, the newfound affluence of Taiwanese society has, inevitably, produced certain social problems that need to be nipped in the bud. The government has realized that the younger generation must be encouraged to retain the work ethic of their elders. This is crucial to the health of the country's economic future. The "nouveau riche" mentality that characterizes the poor who suddenly acquire wealth can result in people opening themselves to financial profligacy, profiteering, corrupt practices, and other social ills that accompany irresponsible wealth. Other emerging social concerns involve the rise in crime and criminal gangs, the breakdown of the family, and the neglect of children as parents become too involved with their careers.