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ECFA predicted to have limited impact
this year
PREDICTION MARKET: Bidders thought it 78 percent likely
that unemployment would remain above 5 percent at the end of this year
By Ko Shu-ling
STAFF REPORTER
Friday, Apr 30, 2010, Page 1
Most Taiwanese think signing an economic cooperation framework agreement (ECFA)
with Beijing will do little to improve the economy and lower unemployment, but
the trade deal is likely to boost the stock market, a prediction market said
yesterday.
On a scale from NT$0 to NT$100, the probability that an ECFA would boost the
TAIEX if it were signed is NT$75, according to bidders, National Chengchi
University¡¦s Center for Prediction Market said.
In other words, share prices on the fifth day after the proposed accord is
signed are likely to be higher than those on the last trading day before it is
signed, the center said.
Bidders also predicted that the odds of the TAIEX reaching 10,000 points this
year were 33.3 percent if the ECFA is signed and only 15 percent if it is not.
¡§In other words, the ECFA would likely have very little impact on the TAIEX
reaching 10,000 points this year,¡¨ the center said.
The probability that per capita GDP would exceed US$18,000 this year after an
ECFA is signed was 12.2 percent, against 10 percent if it was not signed. The
center said the prediction suggested that an ECFA would make a limited
contribution to Taiwan¡¦s economic growth.
Official statistics showed that Taiwan¡¦s per capita GDP was US$16,442 last year.
The Directorate-General of Budget, Accounting and Statistics has forecast that
the figure will jump to US$17,660 this year.
While Premier Wu Den-yih (§d´°¸q) has vowed to keep the unemployment below 5
percent this year, bidders predicted that the prospect of unemployment exceeding
5 percent in December was 78 percent.
On an ECFA¡¦s impact on Taiwan¡¦s bid to sign free-trade agreements (FTA) with
other countries, the center said trading on the issue was insignificant so it
was hard to analyze.
However, judging from similar trade pacts, the odds that Taiwan would ink an FTA
with either Japan, the US, EU or ASEAN countries this year were between 3
percent and 17 percent, the center said.
The administration hopes to ink the cross-strait trade deal before July, so
bidders predicted that the likelihood the planned pact would become a reality
during the second quarter was 50 percent. The prospect fell to 31 percent during
the third quarter and 9 percent for the fourth quarter.
Meanwhile, Mainland Affairs Council Deputy Minister Liu Te-shun (¼B¼w¾±) yesterday
brushed aside Beijing¡¦s political rhetoric about an ECFA, emphasizing the pact
was economic in nature.
The council said Beijing¡¦s political position or proposal was consistent and
understandable, but had no relation to the ECFA negotiations.
¡§We hope [China] will empathize with us because we also have a political
position,¡¨ he said. ¡§There must be room for both sides to work together.¡¨
Liu made the remarks in response to a statement by Wang Yi (¤ý¼Ý), director of
China¡¦s Taiwan Affairs Office, on Wednesday, urging the two sides to jointly
oppose ¡§Taiwan independence¡¨ and insist on the so-called ¡§1992 consensus.¡¨
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