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TAIPEI: "President" Ma Ying-jeou will meet principal officials this weekend on plans to tackle the recession as the island's economy has contracted a record 8.36 percent, his office said yesterday.

"The GDP figures indicate that our economy faces a grave challenge, and the cabinet Saturday will propose to the president measures to tackle the issues," office spokesman Wang Yu-chi said.

Taiwan plunged into recession in the fourth quarter of 2008, and its 2009 GDP is expected to fall by 2.97 percent, the government said Wednesday.

The dismal data prompted the central bank to announce a further 25-basis-point cut to its key interest rate, trimming the benchmark discount rate to a record low of 1.25 percent.

The "finance ministry" reportedly was also considering halving the stock-transactions tax.

Taiwan, the sixth-biggest economy in Asia, has been hit hard by the global financial storm, with record falls in its key export sector and rising unemployment.

The government has unveiled an economic-stimulus package worth about $15 billion in business incentives, infrastructure projects and shopping vouchers.

AFP

(HK Edition 02/20/2009 page16)