This year’s Business Climate Survey results indicated a record high level of optimism in the Taiwan economy among our member companies. Nearly 86% were confident about Taiwan’s economic growth in the next 12 months – up from around 60% one year ago. Such an outlook may seem counterintuitive given the impact of COVID-19 (80% of our members reported their businesses being negatively impacted to some extent by the pandemic). However, it reflects the culmination of a number of years of robust economic growth and a boost in Taiwan’s global stature resulting from its excellent handling of the pandemic.
Many of the indicators, including the fact that over 40% of our members plan to increase their full-time equivalent employees this year – up from 34% last year – would suggest that Taiwan will continue to benefit from the shifts currently taking place in global supply chains.
In many ways, the stars appear aligned for Taiwan at this unique point in time. This is truly a “Golden Moment” for Taiwan, and I feel strongly that if the island is able to capitalize on the many opportunities it has at this time, it will emerge stronger, more stable, and more prosperous.
The drive to make Taiwan bilingual by 2030 (94% of our members feel it will benefit Taiwan’s economic development); its need to enter into multilateral agreements (80% feel Taiwan’s exclusion from multilateral/bilateral trade agreements negatively impacts their businesses); and a smooth transition to green energy (65% are still concerned about the sufficiency of Taiwan’s power supply) are all issues that Taiwan must address to help it capture this Golden Moment.
We also asked members about the impact of President Tsai Ing-wen’s Six Core Innovative Industries initiative, which targets several areas of consequence to Taiwan. Not surprisingly, high-tech, cybersecurity, and medical technology were seen as the most impactful to Taiwan’s future economy, followed closely by green and renewable energy. There is a recognition that Taiwan needs to look beyond semiconductors and develop a diverse portfolio of high-value industries.
Survey respondents also expressed the opinion that Taiwan needs to improve its regulatory environment to facilitate its ambitious plans – 36% of members still say that Taiwan’s rulemaking does not follow international best practices and that regulations do not demonstrate an understanding of industry dynamics or meet economic needs. AmCham’s Taiwan White Paper will continue to highlight specific areas for improvement, but increased consultation with industry throughout the legislative process would also go a long way to ensuring better results.
For our part, AmCham will continue to work with the Taiwan and U.S. governments to help drive the implementation of the key Taiwan government initiatives supported by our members. We all want to see Taiwan prosper! COVID-19 will eventually pass, but it is our hope that Taiwan’s global reputation as a great place to live, invest, and do business will continue to grow.