Taiwan's economy is president Chen's weak point as he seeks re-election
TAIPEI, Taiwan: Hundreds of thousands of Taiwanese spent part of their weekend marching in the streets, urging others to vote against President Chen Shui-bian next Saturday because they think he mucked up the island's economy.
But how much blame should the young president get for Taiwan's recent economic woes?
Chen says the economy slipped into recession for the first time in decades during his watch because of a global slowdown. He also claims that powerful opposition parties that control the legislature didn't help much by blocking most of his initiatives.
But his challenger, ex-Vice President Lien Chan of the Nationalist Party, accuses Chen's government of being inexperienced, incompetent and unpredictable. Lien tells voters his Nationalists - which ruled Taiwan for five straight decades before losing the 2000 election - will bring back the boom days. Those who marched in protests islandwide Saturday believe him.
Analysts say the truth lies somewhere between what Chen and Lien are saying.
Before Chen, 53, took office four years ago, Taiwan's economic growth regularly crossed the 6 percent mark. But during his first term, economic growth plunged into negative terrain and unemployment crossed the 5 percent mark - a record for Taiwan.
The opposition rejects Chen's view that Taiwan was a victim of a global downturn that also hit other Asian economies as well as the United States.
"During the regional financial crisis (in 1997), there were only two places with positive economic growth: China and Taiwan,'' said Hsueh Hsiang-chuan, a leading economic adviser for the opposition. Hsueh said Taiwan should have been able to escape the last downturn as well.
Other analysts agree that the global woes also affected Taiwan, but say policy missteps by Chen helped speed up the decline. One of Chen's mistakes was scuttling a partially completed nuclear plant in 2000 - a move that caused intense political feuding and raised doubts about Chen's leadership in the business community, they say.
"That kind of thing actually hurt some economic momentum,'' said Michael Y.J. Ding, president of International Investment Trust Co., one of Taiwan's largest fund management companies.
Opposition advisers say the nuclear decision caused a chain reaction.
"Investment went down because the political situation was unstable, and savings grew because of the fear of unemployment, causing consumer spending to drop,'' said Lin Tsu-chia, professor of economics at Taipei's National Chengchih University, and a member of Lien's economic team.
Ding said Chen's policy on China relations has also been a negative factor. The president has frequently angered Beijing, which claims the island belongs to China. The two sides split amid civil war in 1949.
Turning to the future, analysts don't see much difference in the candidates' promises of more public works to stimulate domestic investment.
"The main difference is their attitude to China,'' Lien economic adviser Hsueh said. While Chen also promises to improve relations with China, Lien has presented himself as the statesman better able to do so.
One key proposal is the opening of direct transportation links with China, halted for more than five decades. While Chen has also pledged to restart the transport ties, Beijing has not been willing to hand him a success.
Lien also wants to relax restrictions on visits by Chinese professionals and tourists as a way to fire up the local economy and create job opportunities.
However, some commentators say that even the differences in China policy won't make much of an impact in practice.
"Even if Chen Shui-bian is elected again, I doubt that the cross-strait relationship will be very bad,'' Ding said.
Ding thinks Chen has tried to provoke China before, but he doesn't expect the president to continue if he gets re-elected. "That kind of game is gone,'' he said.
As for Lien, there are doubts about how fast he can realize his promises.
"He says we must step up the pace of the opening to China, but once he is elected, national security considerations will be different,'' said David S. Hung, deputy chief of the Taiwan Institute of Economic Research, one of the island's top think tanks. - AP
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