Look Who Pushed World No. 19 Economy Taiwan Into Recession

Taiwan’s economy, ranked world No. 19 by the World Bank, officially went into recession in the July-September quarter. Not just wage-wary workers and price-picky exporters on the industrialized island of 23 million people should pay attention to the 0.3% decline in the third quarter following a 1.14% slip in the second. Taiwan fell into recession – based on two consecutive quarters of negative GDP growth – partly because of hesitant consumer spending in parts of the world and a fall in oil prices (bad if your factory pre-purchased crude at the old higher rates). But the recession story has an eerier, longer-term moral that will threaten Taiwan later even if the half-trillion-dollar economy bounces back next year. That lesson applies not only to Taiwan. Any country dependent on exports, from shoes to smartphones, can learn from it.