Taiwan lawmakers reduced central government spending to NT$1.91 trillion ($65.9 billion) from a proposed NT$1.94 trillion this year as the nation seeks to reduce its deficit and the economy shows signs of recovery.
Under the approved budget, revenue for 2013 will be NT$1.73 trillion, little changed from the Cabinet’s August proposal, the island’s statistics bureau said in a statement yesterday. The government will run a NT$174.3 billion deficit, according to the statement. The Cabinet in August proposed a budget deficit of NT$214.4 billion.
Taiwan’s economy remains vulnerable to fluctuations in demand for its goods amid an uneven global recovery. Gross domestic product grew at a slower pace than previously estimated in the third quarter even as a recovery in China boosted the island’s industrial output and exports.
“They are gradually trying to reduce spending at a moderate pace,” Ma Tieying, a Singapore-based economist at DBS Group Holdings Ltd., said before the statement. “The fiscal balance will improve gradually in the coming years and the public debt-to-GDP ratio can stabilize within five years.’
Taiwan said in November it would alter its public-debt limit to 50 percent of GDP from 48 percent of gross national product, or GNP.
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