The New Taiwan dollar has risen in value by 7 percent so far this year, sparking concerns the appreciation will impact upon Taiwan’s exporters. Hiwin Technologies Corp chairman Eric Chuo has called on the central bank to eliminate the interference of inflows and outflows of hot money, saying that rises and falls in the value of a country’s currency should be governed by the degree to which it is competitive.
At the company’s investors’ conference on Wednesday last week, while discussing the NT dollar, Chuo noted that the exchange rate has an impact upon import and export companies, adding that 80 percent of Hiwin Technologies’ sales come from exports, which means that the company’s profit is affected by exchange rate fluctuations.
Chuo also said Taiwanese industries need to upgrade and improve the added-value of their products in order to cushion the effect of currency fluctuations.
Given the current situation with hot money flows affecting the exchange rate, the central bank should stabilize the exchange rate by eliminating factors which cause inflows and outflows of hot money. While Chuo said he can appreciate the government’s predicament, he noted that the situation is different in Taiwan from that of the US since hot money does not have a significant impact on the US economy.
Source Article: http://www.taipeitimes.com/News/lang/archives/2017/05/16/2003670644
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