TAIPEI, July 23: Taiwan's parliament has approved a 75.9 billion dollars ($2.31 billion) special budget for infrastructure development this year, officials said on Monday. “The 75.9 billion dollar special budget is part of the government's five-year infrastructure expansion project that requires total investment of 500 billion dollars,” said Luh Dun-jin, deputy minister at the Directorate General of Budget, Accounting Statistics (DGBAS).

Legislators have also agreed to raise the pension for senior farmers by 1,000 to 6,000 dollars per month, retroactive from July 1, the official said.

The 1,000 dollar hike per month will lead to an increase of 8.4 billion dollars per year in the government's budget for farmer pensions.

Luh said the special budget and higher pension payment may result in increased private consumption.

The DGBAS had in May forecast 3 per cent growth in private consumption this year.

“Public infrastructure projects theoretically should contribute to individual incomes and as a result help private consumption,” Luh said.

Any revisions to private consumption forecast for this year will be decided at the DGBAS' quarterly meeting next month, he said.

“We have to take into account other factors such as the stock market rally and inflation.” The official said the DGBAS's existing economic growth forecast of 4.38 per cent for 2007 is based on the assumption that the special budget for infrastructure projects would secure parliamentary approval by July. —AFP