Taipei, Jan. 19 (CNA) President Chen Shui-bian said Friday that 2001 will be a crucial year for Taiwan's monetary and financial system, which he said will undergo an all-out transformation.
Chen made the remarks while meeting a group of foreign scholars and experts here for a financial seminar which concluded Friday in Taipei.
He stressed that the seminar, titled "New Vision for Taiwan Financial Markets" and sponsored by Academia Sinica in the first month of the new century, underlines the importance the government attaches to the financial problems facing the nation.
Furthermore, Chen added that among the government's six priority tasks as spelled out in his New Year message are monetary and financial reforms and increased development of the knowledge-based economy.
The president said that although several participants in the seminar are of the opinion that Taiwan is unlikely to suffer a financial crisis because of its sound economic fundamentals, this does not mean that Taiwan should delay its financial reforms. He said that Taiwan, as a small economy that relies heavily on the economic growth of the entire world, has to adapt itself fully to changes in the international economic climate. Therefore, Chen said his financial reforms are aimed not only at maintaining monetary and financial stability, but also at establishing a modernized financial system along worldwide standards to pave the way for the development of the knowledge-based economy.
The foreign experts at the meeting confirmed that Taiwan is heading in the right direction by launching such reforms. Preston Martin, former vice chairman of the U.S. Federal Reserve Board, said that although short-term pain would be inevitable from such reformatory measures as mergers of banking institutions and credit-tightening, any delay of the reforms would only make the problems worse.
He suggested that the government establish an independent monetary supervisory authority to avoid conflicting measures from related agencies. He also urged the government to increase the transparency of monetary and financial information.
Dr. Hubert Neiss, former International Monetary Fund Asia-Pacific director, said that even though global economic growth is showing signs of slowing down, Taiwan's healthy economic fundamentals will help the island's economy expand further.
Other foreign experts present at the meeting included Dr. Michael Moskow, president of the Federal Reserve Bank of Chicago, and Dr. Robert Hamada, dean of the University of Chicago's Graduate School of Business.