Taiwan's government lowered its 2009 economic growth forecast Wednesday and now predicts the island's economy will shrink 3 percent.
The Directorate-General of Budget, Accounting and Statistics also said gross domestic product shrank 8.36 percent in the fourth quarter - its worst quarterly drop ever.In a bid to spur growth, Taiwan's Central Bank lowered the island's key lending rate by a quarter point to 1.625 percent, its seventh rate cut in 4 1/2 months.
With a revision in third quarter GDP to minus 1.05 percent, Taiwan's economy is officially in a recession, traditionally defined as two straight quarters of contraction.
The annual GDP revision came after two consecutive months in which exports tumbled more than 40 percent. Previously, the Directorate-General of Budget, Accounting and Statistics had forecast that gross domestic product would grow 2 percent.
The last time the Taiwanese economy contracted for a full year was in 2001 when the dot.com bubble burst, battering the island's technology industry.
For all of 2008, Taiwan's GDP grew a scant 0.12 percent, the directorate-general said.
source: Forbes
Februari 18, 2009
