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China Times: Alarm sounded over global economy
Central News Agency
2012-06-16 05:49 PM
Just as expected, Spain finally accepted a 100 billion euro bailout package from the European Union to rescue its failing banks, making it the fourth European nation to do so after Greece, Ireland and Portugal. But this time is somewhat different from before because Spain -- with its gross domestic product totaling US$1.3 trillion -- is a much bigger economy than the other three. People are now watching if Italy, which ranks among the world's seven largest industrialized nations, will be next to receive a bailout. Whatever the future developments will be, the troubled eurozone is sinking into recession and is dragging down the global economy. Due to a sluggish European market, Asian countries such as Taiwan, South Korea and China have experienced a slowdown or decline in their exports. Taiwan has lowered its economic growth forecast for 2012 to 3.03 percent as a result, while China is at risk of seeing its economic growth dropping below 8 percent. The eurozone debt crisis also poses a threat to the U.S. economic recovery. In addition to taking conventional measures such as expanding domestic demand, cutting taxes and providing bailout loans to cope with the situation, Taiwan should help local businesses regain their competitiveness. The country should also learn a lesson from the eurozone debt crisis and strengthen its fiscal discipline to avoid a similar crisis happening here. (Editorial abstract -- June 16, 2012) (By Y.F. Low)
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