Taiwan has a dynamic capitalist economy with gradually decreasing guidance of investment and foreign trade by government authorities and partial government ownership of some large banks and industrial firms. Spillover from the Asian financial crisis hit Taiwan in the fourth quarter of 1997 wreaking havoc on the stock and currency markets. While the economy remains sound (the government forecasts 6% GDP growth for 1998) the New Taiwan Dollar depreciated 20% in 1997. Real growth in GDP has averaged about 8.5% a year during the past three decades. Export growth has been even faster and has provided the impetus for industrialization. Inflation and unemployment are low. Agriculture contributes only 3% to GDP down from 35% in 1952. Traditional labor-intensive industries are steadily being moved off-shore and replaced with more capital- and technology-intensive industries. Taiwan has become a major investor in China Thailand Indonesia the Philippines Malaysia and Vietnam. The tightening of labor markets has led to an influx of foreign workers both legal and illegal.

GDP: purchasing power parity $308 billion (1997 est.)
GDP real growth rate: 6.8% (1997 est.)
GDP per capita: purchasing power parity $14 200 (1997 est.)
GDP composition by sector:

• agriculture: 3.3%
• industry: 35.7%
• services: 61% (1996)

Inflation rate consumer price index: 0.9% (1997)

Labor force: total: 9.4 million (1997)

By occupation: services 52% industry 38% agriculture 10% (1996 est.)

Unemployment rate: 2.7% (1997)

Budget: revenues: $40 billion - expenditures: $55 billion including capital expenditures of $NA (1998 est.)

Industries: electronics textiles chemicals clothing food processing plywood sugar milling cement shipbuilding petroleum refining

Industrial production growth rate: 7% (1997)

Agriculture products: rice wheat corn soybeans vegetables fruit tea; pigs poultry beef milk; fish

Exports: total value: $122.1 billion (f.o.b. 1997)
commodities: machinery and electrical equipment 21.7% electronic products 14.8% information/communications 11.8% textile products 11.6% (1997)

Partners: US 24.2% Hong Kong 23.5% Europe 15.1% Japan 9.6% (1997)

Imports: total value: $114.4 billion (c.i.f. 1997)
commodities: machinery and electrical equipment 16.5% electronic products 16.3% chemicals 10.0% precision instrument 5.6% (1997)

Partners: Japan 25.4% US 20.3% Europe 18.9% Hong Kong 1.7% (1997)

Debt external: $80 million (1997 est.)

Economic aid: $NA

Currency: 1 New Taiwan dollar (NT$) = 100 cents

Exchange rates: New Taiwan dollars per US$1 32.45 (year end 1997) 27.5 (1996) 27.4 (1995) 26.2 (1994) 26.6 (1993) 25.4 (1992)

Fiscal year: 1 July 30 June