TAIPEI: Taiwan's economy will grow 3 percent or higher next year, following a gradual recovery in the global economy, the Directorate General of Budget, Accounting and Statistics (DGBAS) said yesterday.

The growth of the domestic economy is likely to turn from negative to positive next year, thanks to the lower comparison basis of 2009 and a possible rebound in major global economies, the DGBAS said.

For this year, however, DGBAS officials forecasted that the growth rate would not be significant if there were any.

The officials said Typhoon Morakot, which pummeled Taiwan August 7-9 with the worst flooding in the island in 50 years, will drag down the domestic economy in the third quarter because of the massive destruction it wreaked.

However, they said, the outlook for Taiwan's gross domestic product (GDP) in the fourth quarter is not necessarily "pessimistic", given that huge governmental funds and resources expected to be channeled into post-disaster reconstruction efforts might rev up economic growth.

"There are chances that the GDP might register positive growth in Q4 as a result of the reconstruction work, which will generate new demand, investment and employment, and as a result of the recovery of the global economies," they forecasted.

"However, the growth range would not be significant," they noted.

China Daily/CNA

(HK Edition 08/21/2009 page2)