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U.S. tariffs on various countries gradually unveiled, global anxiety continues to spread
Taiwan's AI, traditional industries show divergent performance; NT dollar gains weigh on revenue |
Since the beginning of this year, driven by the Trump administration's new policies, economic policy uncertainty in the United States has risen significantly, undermining business and consumer confidence in the outlook. Rising trade protectionism and tariff policy uncertainty have also impacted global trade performance, suppressed investment and consumption momentum while exacerbated global economic downside risks. Fortunately, tariff agreements between the United States and other countries have gradually become clearer recently, helping to reduce market uncertainty and slightly improving the global economic outlook compared to earlier projections.
On the domestic front, despite strong demand for AI, high-performance computing, and cloud-related services, the appreciation of the New Taiwan Dollar has suppressed the revenue performance of some domestic companies when calculated in NT dollars. Combined with weak demand for traditional goods and ongoing low-price competition from overseas competitors, manufacturing firms maintain a conservative outlook on current economic conditions. The service sector has benefited from the summer travel peak season and the approaching deadline for U.S. tariff relief measures, boosting passenger and freight transport demand. Additionally, the outstanding performance of Taiwan's stock market in June has led transportation, warehousing, and financial service providers to view current economic conditions favorably.
The construction industry has benefited from the advancement of technology office buildings, accelerated public works projects, and residential project revenues, with economic conditions improving in June. ...Read more |
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| Revisiting the Misuse of National Income Identity Through Hsiu-Chin Chiu's Analogy |
| Recently, the United States has expressed dissatisfaction with large trade surpluses that various countries maintain against it, using the ratio of each country's surplus to America's total imports as the basis for imposing reciprocal tariffs. Among commentary opposing American policy, many arguments rely on the national income identity to assert that America's trade deficit stems from excessive domestic spending, particularly high government deficits. However, this reasoning is crude due to the misapplication of the national income identity. Economic systems involve complex interactions among various factors, and even sophisticated economic models capture only a fraction of these relationships, making causal connections difficult to discern. My wife, Hsiu-Chin Chiu, conducts economic forecasting at Taiwan's Executive Yuan and possesses considerable familiarity with macroeconomic relationships. She employs the analogy between spinning wheels and a moving car to explain the inappropriateness of using partial phenomena or single equations to assert causal relationships between economic variables. When a car breaks down, people typically check whether the fuel or battery is depleted, or whether the engine and transmission systems have malfunctioned. Rarely would anyone spin the wheels to diagnose problems or directly replace them. Most international trade disputes involve unfair policies. According to the national income identity, trade deficits caused by unfair policies appear to result from excessive spending. The harm that foreign unfair policies inflict on certain countries, particularly America, lies not in increased trade deficits but in seizing markets and production, leading to declining income and employment. Forgetting that unfair policies should be fundamentally eliminated represents an incomplete perspective that fails to see the forest for the trees. Economic systems are extraordinarily complex, and most theories and models are like blind men touching an elephant—they grasp only portions of the whole. Therefore, when applying various theories and economic models, it is advisable to frequently recall Hsiu-Chin Chiu's analogy and carefully consider whether important economic connections have been overlooked. |
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Taiwan Economic Research Monthly
Global Internet Governance and Digital Security Policy: From Anti-Fraud to Platform Regulation |
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In the digital era, information dissemination and content governance face transformation, with child protection, online fraud, and misinformation becoming international focal points. Social media and search engines replace traditional news media as primary information sources, while algorithmic recommendations govern audience content consumption. Internet governance discussions extend beyond technical development to the health of a democratic society. This special issue explores press freedom and algorithmic governance, hate speech regulation, child online safety, OTT TV content classification, fraud prevention, and the UK's Online Safety Act, demonstrating international responses to "online safety governance" and "platform responsibility." The EU has pioneered the European Media Freedom Act (EMFA), which prevents the arbitrary removal of news content and protects algorithmic transparency and editorial independence. The Digital Services Act addresses illegal hate speech and misinformation. Regarding children's internet risks, the EU, UK, and Australia strengthen platform responsibility through legislation, including age verification and parental controls. The UK's Online Safety Act establishes flexible regulatory systems. Australia and Singapore propose frameworks requiring financial, telecommunications, and platform operators to bear fraud prevention responsibility. Policy trends reveal that internet governance involves cross-disciplinary directions, with digital platforms symbolizing technological progress while relating to governance and democracy.
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