The Ministry of Economic Affairs has selected three locations in the Czech Republic, Japan and the US to set up overseas manufacturing parks in a bid to reduce overseas investment barriers facing Taiwanese firms, Minister of Economic Affairs J.W. Kuo (郭智輝) said in an interview on Monday.
President William Lai’s (賴清德) administration has been pushing to implement a policy of setting up overseas manufacturing parks to facilitate the localization of Taiwanese companies — in particular small and medium-sized enterprises — when they move abroad, Kuo said.
Using Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) as an example, Kuo said that “wherever the big companies are, firms in their supply chain should also be there for better integration.”
Photo: CNA
As a result, small, medium and micro enterprises could also follow suit and invest overseas, said Kuo, who served as chairman of semiconductor raw material and equipment supplier Topco Group (崇越集團) before becoming economics minister.
The first overseas manufacturing park is expected to be established in the US, Kuo said.
“I have communicated with the [US] officials about tax issues. This is also the most important thing for Taiwanese firms,” he said.
As for setting up an industrial zone in Kyushu, Japan, talks with the Japanese government are ongoing, Kuo said.
The minister also revealed for the first time that the ministry is considering a plan to establish a large trading company.
It would be a public-private joint venture and modeled on Japan’s seven major trading companies, which include Itochu Corp, to help Taiwanese firms receive orders and market their products abroad, Kuo said.
Regarding former US president and Republican presidential candidate Donald Trump’s comments criticizing Taiwan for taking “all of our [the US’] chip business” and not spending enough on defense, Kuo said Trump’s remarks were “not anti-Taiwan” and were no cause for alarm.
“Trump is a businessman that weighs things in terms of cost,” and for him, the US cannot bear the cost of being the world’s police all by itself, he said.
Trump probably has been misled to think that Taiwan has snatched up all of the US’ chip business, Kuo said.
“My personal view is that this has to do with our insufficient efforts lobbying in Washington,” he said.
TSMC, GlobalWafers Co (環球晶圓), Hon Hai Technology Group (鴻海科技集團) and MediaTek Inc (聯發科) have lobbyists, but even with the ministry’s personnel, the government and Taiwanese firms have fewer than 10 people lobbying in the US capital, Kuo said.
There is a high possibility that if Trump is elected, with his ambition to “make America great again” and bring manufacturing back to the US, tariffs would be raised on foreign products, he said.
Kuo said his policy of bringing Taiwanese supply chain companies along with TSMC to the US could counter the impact of tariffs.
“By manufacturing locally [in the US] we could also increase your gross domestic product,” he said.
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