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China Times: Prepare for slower growth in China
Central News Agency
2014-04-21 01:30 PM
China's economic growth dropped to 7.4 percent in the first quarter of the year, missing the target of 7.5 percent set by Beijing. After years of high-speed growth, China's economy has obviously slowed down in recent years. The original growth model that relied heavily on exports and investment no longer works due to changes in the domestic and international environments. The massive stimulus previously promoted by Beijing has further led to overcapacity and a financial bubble, making it hard for the policy to continue. A slowdown in the world's second largest economy will have a considerable impact on other Asian countries and emerging markets. With China playing a double role as both Taiwan's production base and market, Taiwan can expect to be affected more than others in the region. The government needs to take proper steps to deal with the situation. Besides attracting China-based Taiwanese companies to bring operations back home, it should assist these companies to explore new markets. Even as industrial production in China has slowed down, the services sector there has remained robust, making it an attractive market for Taiwan's service industry. It is important for Taiwan to seize the opportunity and ensure early passage of the trade in services agreement that was signed with China last June. Similar to Taiwan, China's efforts to transform industry have focused on high-end devices, green energy, bio-technology and a new generation of information and communications industries, a situation that is likely to intensify cross-strait industrial competition. There is a need for Taiwan to seek strategic economic dialogue with China to build a mutually beneficial partnership. (Editorial abstract -- April 21, 2014) (By Y.F. Low)
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