Seems like Taiwan lives in a parallel universe altogether! Of course not. But at a time when the world is trying to sustain the pandemic, this tiny island is growing at unimaginable levels. Curious to know why? Check out our story.
Crux of the Matter
Let’s start by taking a look at the island’s growth.
Why Such Growth?
- Solely due to an increase in the country’s exports amidst a global shortage in the semiconductor supply.
- Taiwan Semiconductor Manufacturing Co., the world’s largest contract chipmaker is based out of Taiwan.
- The semiconductor chips are one of the core components for the production of, electronic appliances, automobiles, smartphones, Internet of Things (IoT).
- The island’s commendable navigation through the Covid pandemic.
- There were just 9 deaths & less than 1000 reported cases since the outbreak.
- The economy never came to standstill, and instead, domestic travel increased – giving a boost to overall inland earnings.
From an international perspective, with rising local currency, the island’s exports become costlier, hurting a key trade partner and a strong political ally, United States.
- Growing exports
- Currency appreciation. growth in stocks.
- Imports become cheaper.
- Demand for local products decrease.
- Inflation decreases and thus the price level.
- The local producers have to further lessen the price in order to be competitive.
Curious to know more about Taiwan and it’s history? Read More here.
- The Taiwan Miracle refers to the rapid industrialization and economic growth of Taiwan during the latter half of the twentieth century. As it developed alongside Singapore, South Korea and Hong Kong, Taiwan became known as one of the “Four Asian Tigers”.
- “Chinese Taipei” is the name used in some international organizations and competitions for Taiwan. This name was first proposed in the Nagoya Resolution whereby the ROC/Taiwan and the People’s Republic of China recognize the right of participation to each other when it comes to the activities of the International Olympic Committee and its correlates.
- The Asian financial crisis was a period of a financial crisis that gripped much of East Asia and Southeast Asia beginning in July 1997 and raised fears of a worldwide economic meltdown due to financial contagion. Taiwan was one of the least affected nations.