( CNN ) -- Taiwan 's economy slumped 8.36 percent during the last three months of 2008 , the government said Wednesday . People line up to receive $ 108 U.S. dollars worth of shopping vouchers in Taipei , Taiwan , last month . The island 's economy spiraled into recession with its second straight quarter of economic losses . For the third quarter of 2008 , Taiwan 's real gross domestic product ( GDP ) , adjusted for inflation , slipped about 1 percent , according to the Directorate General of Budget , Accounting and Statistics . Behind the dismal economic numbers is a global recession that is sapping demand for the products Taiwan makes . `` The types of exports that Taiwan ships to the West -- electronics -- are very severely affected , very sensitive to changes in Western consumer sentiment , '' said Frederic Neumann , a senior Asian economist for HSBC . The GDP numbers are the broadest measure of Taiwan 's economic activity . A recession is defined as two consecutive quarters of falling GDP . Taiwan 's central bank , in a move to boost the economy , on Wednesday dropped its key interest rate one-quarter point , to 1.25 percent . Since the end of 2007 , the central bank has lowered rates by more than 2 percent . In January , the Taiwanese government offered the island 's residents up to $ 108 each to go shopping , in another attempt to stimulate the economy . More than 90 percent of those eligible took up the offer , pumping about TW $ 86 billion ( $ 2.6 billion ) into the economy and sending shoppers to malls , officials said .
Asian economy now in recession now after second straight quarter of losses . In January , government offered residents $ 2.6 billion each to stimulate economy . Slump of one percent followed third-quarter slump of one percent .