Economic Affairs Minister Y.S. Sun urged industry and the public to cooperate with the government in overcoming economic difficulties this year.
Sun told a press conference "1974 is going to be a most difficult year" as the Republic of China begins to feel the pinch of the energy crisis and shortages of raw materials. "The government," he said, "has worked out a plan to maintain the nation's economic growth and stabilize commodity prices. But success depends on wholehearted support and cooperation from industry and the public."
He said the most serious problems are "commodity prices and the energy crisis." The government is trying "to keep the price spiral to a minimum and reduce the impact on the pocketbook of low-income people."
Sun said the energy crisis and shortages of raw materials "were mainly caused by the cutback on oil production and the rise in the oil price." He expected that exports of industrial goods would be affected by the rising cost of production.
Sun said inflation is inevitable this year. Taking oil as an example, he noted the price has risen from US$2 to more than US$10 a barrel.
Sun said government price control will be limited to daily necessities.
Government has achieved initial success in stockpiling essential goods and industrial raw materials, he said. "The most important thing is to encourage industrial output and cut down waste."
Sun assured industry that government won't try to reduce profits with administrative decrees.
Sun said industries made big profits last year "because they succeeded in buying raw materials cheap and selling their products high on the international market."
This situation may be reversed this year. Sun said industries will have to buy raw materials high and sell their products cheap.
Sun predicted a slowdown in economic growth this year.
Taiwan's economy grew by 12.3 percent last year. The gross national product was US$9.39 billion with per capita income of $467.
Finance Minister Li urges more austerity
Finance Minister K.T. Li urged the nation to revise its living style to cope with the energy crisis.
Rice cookers alone, he said, can consume as much as 800,000 kilowatts of electricity at peak load, or the power generating capacity of two fairly large plants.
"Our economic structure has undergone a 180-degree change during the last two decades," he said. "A typical agricultural society has been replaced by an industrial society."
Exports constituted only 13.1 percent of the GNP in 1963. The ratio has risen to 45 percent in a decade.
The effect of economic prosperity on the living habits of the people has been marked, Li ob served. He gave the following figures in illustration:
- There were only 63,400 rice cookers in 1962. The figure rose to 2,340,000 in 1972.
- Per capita textile consumption rose from 1.71 kilograms in 1952 to 9.41 kilograms in 1972, a fivefold increase in two decades. More than half of textile goods are synthetic fibers derived from the petrochemical industry.
- During the last decade, the number of automobiles has increased threefold to more than 170,000. The number of motorcycles has increased 28 times to 1,150,000 in the same period.
Because of the oil shortage, Li said, conspicuous consumption should be modified.
Li said the use of big private cars should be discouraged through taxation.
In housing, natural lighting, ventilation and the use of solar energy should be preferred to air conditioning.
Electricity consumption should be reduced by cutting down on use of heaters and other power-consuming appliances.
Consumption of synthetic fibers can be slashed by economizing on clothing, he suggested.
Growth of 7 percent estimated for 1974
The economy will grow 7 percent this year, according to government forecast.
Industry will grow by only 15.1 percent, the Industrial Development Bureau predicted.
An earlier IDB estimate forecast a growth rate of 18 percent.
A spokesman of IDB said the projected growth rate was lowered because of the shortage of raw materials and the oil crisis.
Revised predictions included manufacturing growth of 15.6 percent.
The building industry is expected to grow at 14.5 percent, public utilities at 14.5 percent and mining at 3.5 percent.
Agriculture is expected to grow by 4 to 4.5 percent this year. Growth rates were 2.9 percent in 1973 and 1.9 percent in 1972.
Rice production is expected to total 2.5 million metric tons this year, an increase of nearly 200,000 tons over 1972.
Five and a half million head of hogs will be raised this year. A half million will be for export.
Sugar production is expected to hit 830,000 metric tons this year.
Other agricultural production targets include:
- Maize, 150,000 metric tons.
- Soybeans, 90,000 metric tons.
- Kaoliang (sorghum), 150,000 metric tons.
- Peanuts, 130,000 metric tons.
- Sweet potatoes, 3.6 million metric tons.
- Fishery products, 800,000 metric tons.
Supply of major raw materials for industry will not constitute a big problem in the first half of 1974 thanks to stockpiling, ac cording to a survey made by the Industrial Development Bureau.
The bureau said it will do all it can to help industrial plants procure raw materials for the remaining months of the year.
Following is the bureau's estimate of the supply and demand situation in the January-June period:
Coke - Estimated requirement of 145,500 metric tons, supply of 147,600 metric tons.
Coal - Estimated requirement of 2,145,000 metric tons, supply of 1,530,000 metric tons.
Carbide - Estimated requirement of 69,000 metric tons, sup ply of 70,000 metric tons.
Salt - Estimated requirement of 380,000 metric tons, supply of 430,000 metric tons.
Caustic soda - Estimated requirement of 86,000 metric tons, supply of the same amount.
Alkali - Estimated requirement of 30,000 metric tons, supply of the same amount.
PVC - Estimated requirement of 76,200 metric tons, supply of 68,400 metric tons.
Low-density polyethylene - Estimated requirement of 32,040 metric tons, supply of the same amount.
Cement - Estimated requirement of 3,200,000 metric tons, supply of the same amount.
Sheet glass - Estimated requirement of 1,080,000 metric tons, supply of 1,108,000 metric tons.
Urea - Estimated requirement of 36,000 metric tons, supply of 30,000 metric tons.
Taiwan takes place among trade leaders
Taiwan has become one of the world's top trading nations in a dozen years.
In 1962 trade totaled only US$523 million.
Trade reached an all-time high of US$8.2 billion last year, making the Republic of China the top trading nation among the developing countries.
Exports totaled US$4.5 billion and imports US$3.7 billion.
Industrial commodities represented only 52 percent of exports in 1963. They accounted for over 92 percent of sales last year.
Agricultural products, which formed the mainstay of exports in the 1950s, made up only 7 percent of 1973 exports.
Textiles remained the top foreign exchange earner with volume of US$1.3 billion, an increase of 54 percent.
Electrical machinery apparatus followed with US$740 million, up by 60 percent.
Other major exports were ply wood (US$400 million), metal products (US$241 million), plastics products (US$240 million), fishery products (US$150 million) and transportation equipment (US$98 million).
Over 70 percent of imports were industrial raw materials. A total of US$2.3 billion worth of raw materials was imported in 1973, an increase of 50 percent.
Capital goods ranked second with US$1.3 billion, representing 36 percent of the total and an increase of 55 percent.
Electrical machinery apparatus topped the import list at more than US$600 million, up 60 percent.
Machine tools followed with US$450 million, an increase of 60 percent.
The United States remained Taiwan's top trading partner. U.S. trade totaled US$2.5 billion, or 38 percent. Exports of US$1.6 billion exceeded imports by US$700 million.
Japan ranked second with a two-way volume of US$2.1 billion. Exports were US$700 million and imports US$1.4 billion. Some 12 percent of exports went to the island empire.
Europe was the third ranking trading partner. Exports were US$500 million and imports at US$400 million.
Trade with Southeast Asia totaled US$1,030 million with exports of US$600 million and imports of US$430 million.
US$50 million worth of commodities was exported to Latin America. Imports were US$40 million.
Africa bought US$80 million worth of goods from the Republic of China and supplied US$40 million worth of commodities to Taiwan.
Trade will surpass gross national product
Foreign trade will surpass the gross national product, the China Credit Information Service predicted.
Trade will reach US$11.5 billion and the GNP US$11 billion according to the forecast.
CCIS said trade expansion will be substantially smaller than in previous years. The higher volume in term of dollars will be the result of price in creases.
CCIS expects a minimum in crease of 25 percent in the price index of export and import products.
Export growth will slow down while imports will register a sharp increase, CCIS said.
Exports will increase by about 30 percent to a total of US$5.8 billion and imports will rise to some US$5.7 billion, or an increase of 60 percent.
Two European banks will open branches
The government has decided in principle to ease rules for setting up branches of foreign banking institutions in order to promote external trade.
Government agencies have agreed to approve applications by banks in countries which have no diplomatic ties with the Republic of China.
Two European banks are expected to open branches. One is Singer N. Friedlander Banking Corporation of England and the other Ciave Banking Corporation of France.
The new banks will handle foreign exchange settlements for trade with Europe.
Taipei has nine foreign banks:
First National City Bank, Bank of America, American Express, Chase Manhattan, Continental Bank of Illinois, Irving Trust Company, First Kangyo Bank, Bangkok Bank and Metropolitan Bank and Trust Co.
Taiwan's overseas investments climb
Taiwan overseas investments totaled US$100 million as of the end of last year, according to unofficial estimate.
Most Taiwan capital is invested in Southeast Asia, where overseas Chinese control a large segment of the economy.
A fifth of the overseas investments have been channeled into Thailand. The US$20.63 million invested in the Southeast Asian kingdom represents 4.4 percent of Thailand's total foreign investments.
Among industries which have absorbed Taiwan capital are textiles, basic metals, food processing, electrical machinery apparatus, plastics and chemicals.
Philippines Secretary of Trade Troadio T. Quiazon said Tatung Company of the Republic of China would manufacture its wide range of industrial machinery and electronic and electrical equipment in partnership with Filipino companies.
Tatung will also make petrochemicals, copper sheets, copper tubing, wires and cables in the Philippines.
Electrification contracts awarded
Three international companies, including General Electric of the United States, were awarded engineering contracts for the electrification of Taiwan's west coast railroad.
Under a US$60 million contract, GE will replace tracks and supply locomotives.
General Electric Company of England won a US$70 million contract to install remote control and communications systems and build power substations and the transmission system.
E.M. Ericsson of Sweden will install the traffic control system for US$11 million.
Rail electrification is expected to get under way in May.
With a price tag of NT$11.7 billion (US$307,894,000), the three-stage project will be completed by the end of 1978.
Travel time between Taipei and Kaohsiung will be cut to three hours. Load capacities will be increased by at least a third for each train.
Work gets under way on east coast railway
First-stage construction work on the Suao-Hualien railroad was started at both ends.
In Hualien, Minister without Portfolio Li Lien-chun saw bull dozers and rock breakers roll out.
Director Chen Shu-hsi of the Taiwan Provincial Communications Department and Director Chen Te-men of the Taiwan Railway Administration were on hand for the start of construction in Yilan.
Though there were no ceremonies, residents in the 13 towns and villages along the projected line set off firecrackers to celebrate.
To be completed in five years, the project will cost NT$2.7 billion (US$71 million).
The 82-kilometer (50-mile) railroad will be partially open to traffic in three years.
Intended to bring prosperity to eastern Taiwan, the project is expected to spur 10 percent growth in passenger transportation and 6 per cent growth in freight.
Taipei house prices double in a year
The price of houses in Taipei has doubled in a year.
Prices can be calculated by taxi fares from the city's center.
If the fare is no more than NT$30, the house is worth NT$40,000 per ping (36 sq. feet). Taxi fares from NT$30 to NT$40 have a value of NT$30,000 per ping and those in the suburbs NT$25,000 to NT$20,000 per ping.
These prices apply to four-story apartments. Taller buildings bring more.
House prices started to increase sharply last July. Construction materials have soared since then.
The price of steel bars, one of the most important items in housing construction, has increased more than three times since early 1973.
A construction company recently advertised houses under construction at Hsintien in suburban Taipei.
Two hundred units were sold in an hour the next day. Buyers were lined up in front of the company's office at 5 a.m.
One of every three women is employed
One of every three women in Taiwan has a job, according to a recent labor survey.
Employed females aged 15 to 45 years numbered 1,752,000 as of the end of last year.
The rate of employment was 33.02 percent, 3.38 percent higher than in 1963. In 1963, the employment rate was 29.64 percent.
Half of working women (877,000) were married. Most were unskilled and 556,000 were engaged in manual labor.
Some 462,000 (26.83 percent) of working women were in the 15-to-19 age bracket.
Half of women workers had finished only primary school. They totaled 833,000.
The survey showed 30,000 women failed to find work last year.
About 871,000 women did not want jobs. They accounted for 38.63 percent of the potential work force.
Private Australian office opens in Taipei
A private non-profit Australian association opened a Taipei office to provide services normally rendered by a consulate.
Dr. Douglas Darby, president of the Australia-Free China Society, officiated.
Located at 43 Huaining Street, the Taipei office will promote trade and economic cooperation.
Liu Chen-kai, secretary-general of the Sino-Australian Cultural and Economic Association, heads the office.
Formed in Sydney last month, AFCS is dedicated to supporting the cause of the Republic of China. Its head office at 383 George Street, Sydney, gives assistance to Australians seeking information about the Republic of China.
Tuna fishing industry hit by oil shortage
The oil crisis may deal a crippling blow to free China's tuna fishing industry.
Five hundred and eighty-five Chinese tuna trawlers are operating in the Pacific, Atlantic and Indian Oceans. Their catch was 101,900 tons last year, 8.4 percent of the world total.
Tuna boats used to get their fuel at 50-odd overseas bases. Thirteen bases have stopped selling them oil.
Fuel price increases range from 25.4 percent in Samoa to 273.3 percent in South America.
Operating costs of the tuna fleet are expected to more than double. The tuna fleet consumed about 250,000 kiloliters of oil last year.
The government may be asked to send tankers to overseas fishing bases with fuel. More fishing bases might be opened in Persian Gulf oil-producing countries.
The Taiwan fish catch was 750,000 metric tons in 1973, an increase of 8 percent.