A US trade group has suggested that Taiwan leverage its strengths in high-tech manufacturing to position itself as a regional technology hub because more businesses would be willing to consider it as such when regular direct cross-strait flights commence.
“Numerous analysts say Taiwan’s best bet would be to leverage its existing strengths in high-tech manufacturing to position itself as a regional hub for technology-intensive industries such as ICT [information and communications technology] and biotech, though they caution that Taiwan has a window of about 10 years to accomplish this before cities in China start catching up,” the Taipei-based American Chamber of Commerce (AmCham) said in the cover story of its business publication, Topics.
Many Taiwan-based ICT companies are already playing important regional and even global roles, the report says, adding that Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), for instance, is the world’s largest contract chip maker and that companies with head offices in Taiwan account for 80 percent of the world’s notebook computer production.
“In Taiwan, you have ready access to the electronic manufacturing chain and also access to distribution channels in China,” Peter Kurz, head of Taiwan research for Citi Investment Research, was quoted as saying.
“It’ll be the tech companies that draw foreign companies here, whether Japanese or Western,” he added.
Tristan Liu (呂曜志), an economist with the Taiwan Institute of Economic Research (台經院), reached the same conclusion about Taiwan’s prospects for serving as a regional center.
He views such a hub as encompassing tech-related downstream activity, such as chip packaging, venture capital firms and other financial services aimed specifically at technology companies, and other services such as recruiting and training.
Wang Jiann-chyuan (王健全), an economist with the Chung-Hwa Institution for Economic Research (中經院), estimates that 5 percent to 10 percent of Taiwanese companies based overseas intend to relocate more operations here because of the improvements in cross-strait ties and new, more stringent labor regulations that have been adopted in China.
Lim Tay Her (林泰禾), an analyst with Asia’s leading brokerage CLSA Asia Pacific Markets, notes that if 30 percent of the more than 1 million Taiwanese working in China return, added consumption would have a dramatic impact on the economy since most are highly paid professionals.
Besides technology expertise, Taiwan is also more attractive than Chinese locations in terms of living conditions, protection of intellectual property rights and employee loyalty — and, surprisingly, for costs in many cases. But it still needs to reduce government red tape to be competitive.
“We’ve found that the cost of running a business in Taiwan is actually slightly better than running the same business in other [Asian] locations — including things like cost of living, the cost of expatriate rent, office costs and manufacturing costs,” said Alan Eusden, chairman of AmCham and president of Corning Display Technologies Taiwan Co, a leading maker of glass substrate for liquid-crystal-display panels.
However, the report warns that inadequate infrastructure and the proliferation of red tape might be the two most daunting obstacles standing in the way of Taiwan becoming a regional operations hub.
TECH RACE: The Chinese firm showed off its new Mate XT hours after the latest iPhone launch, but its price tag and limited supply could be drawbacks China’s Huawei Technologies Co (華為) yesterday unveiled the world’s first tri-foldable phone, as it seeks to expand its lead in the world’s biggest smartphone market and steal the spotlight from Apple Inc hours after it debuted a new iPhone. The Chinese tech giant showed off its new Mate XT, which users can fold three ways like an accordion screen door, during a launch ceremony in Shenzhen. The Mate XT comes in red and black and has a 10.2-inch display screen. At 3.6mm thick, it is the world’s slimmest foldable smartphone, Huawei said. The company’s Web site showed that it has garnered more than
CROSS-STRAIT TENSIONS: The US company could switch orders from TSMC to alternative suppliers, but that would lower chip quality, CEO Jensen Huang said Nvidia Corp CEO Jensen Huang (黃仁勳), whose products have become the hottest commodity in the technology world, on Wednesday said that the scramble for a limited amount of supply has frustrated some customers and raised tensions. “The demand on it is so great, and everyone wants to be first and everyone wants to be most,” he told the audience at a Goldman Sachs Group Inc technology conference in San Francisco. “We probably have more emotional customers today. Deservedly so. It’s tense. We’re trying to do the best we can.” Huang’s company is experiencing strong demand for its latest generation of chips, called
ISSUES: Gogoro has been struggling with ballooning losses and was recently embroiled in alleged subsidy fraud, using Chinese-made components instead of locally made parts Gogoro Inc (睿能創意), the nation’s biggest electric scooter maker, yesterday said that its chairman and CEO Horace Luke (陸學森) has resigned amid chronic losses and probes into the company’s alleged involvement in subsidy fraud. The board of directors nominated Reuntex Group (潤泰集團) general counsel Tamon Tseng (曾夢達) as the company’s new chairman, Gogoro said in a statement. Ruentex is Gogoro’s biggest stakeholder. Gogoro Taiwan general manager Henry Chiang (姜家煒) is to serve as acting CEO during the interim period, the statement said. Luke’s departure came as a bombshell yesterday. As a company founder, he has played a key role in pushing for the
Vanguard International Semiconductor Corp (世界先進) and Episil Technologies Inc (漢磊) yesterday announced plans to jointly build an 8-inch fab to produce silicon carbide (SiC) chips through an equity acquisition deal. SiC chips offer higher efficiency and lower energy loss than pure silicon chips, and they are able to operate at higher temperatures. They have become crucial to the development of electric vehicles, artificial intelligence data centers, green energy storage and industrial devices. Vanguard, a contract chipmaker focused on making power management chips and driver ICs for displays, is to acquire a 13 percent stake in Episil for NT$2.48 billion (US$77.1 million).