President Ma Ying-jeou met with Dr. Oliver E. Williamson, the 2009 Nobel Laureate in Economic Sciences, at the Presidential Office on the afternoon of June 24, and extended a cordial welcome to him on his visit to Taiwan on behalf of the government and people of the ROC.
The president remarked that Dr. Williamson's research had extremely important meaning with regard to the global financial tsunami that unfolded two years ago. In particular, his work related to transaction cost economics and economic governance has had an important impact on and made a major contribution to the study of economics throughout the world, he said. In addition, Dr. Williamson has quite an original take on "too big to fail" companies, risk taking, and the proper role of government in crisis management, the president said.
President Ma remarked that two years ago shortly after he was inaugurated, the bankruptcy of Lehman Brothers triggered a global financial tsunami that was followed by a recession. This caused the most severe economic crisis in Taiwan in recent decades, he said. In order to stabilize the economy, the government introduced a variety of measures including cutting interest rates, expanding domestic demand, fully insuring bank deposits, and initiating a policy in which the government would support banks, so that banks could support the corporate sector, and the corporate sector could protect employees. The government even issued spending vouchers, which were meaningful both to the economy and the public. Together, these steps helped to steady Taiwan's economy, he said.
President Ma stated that the downturn in Taiwan's economy ended in the fourth quarter of last year. In the first quarter of this year, he said, economic growth rate hit 13.27%, which was the highest quarterly growth level in 32 years. In the first five months of this year, exports have grown 53% and imports have risen 71% in comparison with the year-earlier period. The government's Directorate General of Budget, Accounting and Statistics predicts that the nation's economic growth this year will reach 6.14%. The president said that other economic forecasting bodies and some foreign institutions and companies are even more bullish on Taiwan’s future economic prospects. The president said that Taiwan's ranking in this year's World Competitiveness Yearbook by Switzerland's IMD was the highest ever, which points to the fact that Taiwan has already steadily emerged from the economic downturn. President Ma said he hopes that the economy will quickly return to levels seen prior to the financial tsunami.
President Ma remarked that the government has focused on generating an economic recovery that displays four characteristics – high growth in employment, innovation, energy conservation and reduction in carbon emissions, as well as participation in regional economic integration. He said that thanks to the efforts by the public and all government agencies, Taiwan's unemployment rate is presently heading lower, and the government is confident of creating even more jobs. Next, the president said that the Legislative Yuan has already passed the Act for Industrial Innovation. The government will be lowering the business income tax to 17% from 25% in order to encourage innovation in the corporate sector and to attract even more foreign investment. He said the government is aggressively promoting work related to reducing greenhouse gas emissions and expects that the volume of emissions in 2020 will be cut by over 30%, thereby returning to 2005 levels. Lastly, he said, with regard to regional economic integration, Taiwan and mainland China have been in negotiations for quite some time on an Economic Cooperation Framework Agreement (ECFA), and these talks are in the final stage. If everything goes smoothly, a deal will be signed next week, he added. In the future, Taiwan products entering the mainland China market will enjoy tariff-free treatment. This will also attract Taiwan companies and foreign enterprises alike to invest here, he said. President Ma expressed that Taiwan hopes to hold talks in the future with its major trading partners with an eye to reaching similar agreements.
Dr. Williamson, Mega Financial Holding Co. Chairman Wang Rong-jou, and UDN Group CEO Duncan Wang were accompanied to the Presidential Office in the afternoon by Vice Economics Minister Francis Kuo-hsin Liang to meet President Ma. Also in attendance was National Security Council Deputy Secretary-General John C.C. Deng.