The measures include tax breaks, financial incentives for businesses, and steps to boost investment and expand exports worth a price tag of NT$ 122.6 billion. The package also includes NT$13.5 billion in subsidies for low-income families.

Young couples who plan to buy a new house will get NT$ 200 billion in cheap housing loans.

“The package aims to stimulate spending, boost investment and infrastructure, and stabilise financial markets,” said Chen Tian-jy, chairman of the Council for Economic Planning and Development.

The goal is to shore up Taiwan’s ailing economy and help the island nation achieve the government's target of 4.3 per cent economic growth this year.

Many experts believe instead that the stimulus package will achieve very little.

Indeed Taiwan's stock market tumbled 3.2 per cent yesterday to a 33-month low, down about 25 per cent this year.

“It is impossible for Taiwan stocks to escape the massive global financial downturn,” said Stephen Tsui, director of Hong Kong-based Taiwan Concord Capital Securities.

“Indeed, many overseas investors have started to discount the Taiwan government's prestige as Chen Shui-bian's corruption and money-laundering scandals drag [down] more and more [serving] senior officials into it.”

Mr Tsui even doubted the stimulus scheme would help President Ma Ying-jeou regain some popularity.

Opinion polls released by the Taipei-based China Times indicate that Mr Ma's approval rating rose to 46 per cent from 36 per cent last month. But the Taiwanese leader enjoyed a rating of up to 79 per cent when he was elected in March.