From the last edition of the ROC (Taiwan) Yearbook that used to be published by the disbanded Government Information Office (GIO).

1. The Taipei International Cycle Show,
featuring a vast variety of bicycles and
associated products from around the
world, attracts increasing numbers
of exhibitors and visitors each year.
(Courtesy of the Taiwan External Trade
Development Council)
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2. 8 Economy
At a Glance
•• Strong rebound from global recession
•• Strategies for stimulating innovation and transformation
•• Programs for development of target industries
T
aiwan’s economic performance in 2010 surpassed expecta-
tions, registering nearly 11 percent growth. Foreign trade
surged on the strength of steady recovery of the global econ-
omy. Industrial production indices saw double-digit increas-
es, and business investment greatly expanded. Unemployment dropped
to 4.67 percent in December 2010 from 5.74 percent a year earlier, and
consumer confidence grew, while prices rose moderately.
Since taking office in May 2008, the administration of President Ma
Ying-jeou has striven to transform Taiwan into a global innovation cen-
ter, an Asia-Pacific economic and trade hub, and an operations center
for overseas-based businesses. Toward that end it has implemented a
series of policy initiatives including tax reform, cultivation of talent and
encouragement of innovation. Also included are measures for promot-
ing industries with high potential for rapid development. Of further
significance, in June 2010, Taiwan signed a trade pact with mainland
China, and teams of government and industry experts traveled to major
cities around the world to introduce outstanding investment opportuni-
ties in Taiwan to foreign business communities.
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3. 8 Economy
National Competitiveness higher education, personnel resources,
market efficiency and innovation.
Taiwan continued to play a dynamic
•• Taiwan placed sixth in the WEF’s Net-
role in the global economy in 2010. Ac- worked Readiness Index of the Global
cording to World Trade Organization Information Technology Report 2010-
statistics, it was the world’s 16th-largest 2011, up five notches from the previ-
exporter and 17th-largest importer of ous year, for its best showing since the
merchandise, while ranking No. 24 and index was first released in 2001. It also
No. 28 in export and import of com- ranked second in terms of government
mercial services, respectively. One of the ICT usage.
most powerful players in the global infor-
•• In its April 2011 Business Risk Service
mation and communications technology
report, U.S.-based Business Environ-
(ICT) industry, it is also a major supplier
ment Risk Intelligence again rated
of other goods across the industrial spec-
Taiwan as having the fourth-lowest-risk
trum, from chlorella health food supple- environment out of 50 nations surveyed.
ments to powered wheelchairs.
A key factor underpinning such
performance is the ROC govern- GDP Profile
ment’s formulation of policies to foster
Due to improving global conditions as
development and sustain the nation’s
well as stronger domestic consumer confi-
economic competitiveness by promot-
dence buoyed by rising employment and vi-
ing investment in human resources,
brant financial activity, Taiwan’s real gross
research and development (R&D) and domestic product (GDP) grew by 10.88
industrial upgrading as well as through percent in 2010 to reach US$430.10 billion.
other initiatives aimed at creating ad- Net exports contributed 2.40 percentage
vantages for its economy. For such points to GDP growth while real domes-
reasons, and because of its enterprises’ tic demand—expanding 9.91 percent—
strong entrepreneurial spirit, Taiwan’s accounted for 8.48 percentage points.
business and investment environments Among the factors boosting domestic
have consistently been ranked as superi- demand, private consumption rose 3.65
or by well-regarded economic research percent, helped by a 9.60-percent increase
organizations. For example: in business revenues in the wholesale, re-
•• In the 2011 World Competitiveness tail and food and beverage sectors. Private
Yearbook issued by Switzerland’s In- investment, meanwhile, grew 32.51 per-
ternational Institute for Management cent as high-tech firms increased capital
Development, Taiwan moved up two expenditures to improve production pro-
places to No. 6 overall to achieve its best cesses and expand capacity to meet rising
ranking in over a decade. It retained the export demand. Despite ongoing high
third spot in the “business efficiency” levels of spending on public infrastructure
category, attributable in part to its com- in 2010, government investment in that
panies’ adaptability and its stock market year declined 1.71 percent compared with
efficiency, ranking first and second, re- the still higher level of such spending in
spectively, in these categories. 2009. Nominal GDP per capita, as meas-
•• Taiwan ranked 13th in the World Eco- ured in U.S. dollars, rose to a record-
nomic Forum’s (WEF) Global Com- high US$18,588, in part due to the nearly
petitiveness Report 2010-2011, earning 6-percent appreciation of the New Taiwan
high marks in the categories of health, dollar against the U.S. dollar.
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4. Macroeconomic Indicators
2010 GDP (nominal) US$430.10 billion
2010 GDP per capita (nominal) US$18,588
2010 GDP per capita (ppp – IMF) US$35,227
2010 GDP growth* 10.88%
2000-2009 GDP growth, average* 4.04%
2011 GDP growth, projected* 4.81%
2010 Unemployment rate, average 5.21%
2010 Unemployment rate, end of year 4.67%
2010 Consumer price index (CPI), average change 0.96%
2011 CPI, projected average change 2.18%
2010 Wholesale price index (WPI), average change 5.46%
2011 WPI, projected average change 2.23%
2010 Exports US$274.60 billion (up 34.8%)
2010 Imports US$251.24 billion (up 44.1%)
2010 Balance of trade US$23.36 billion surplus
2010 Foreign exchange reserves, end of year US$382.01 billion
2010 Registered inward investment US$3.91 billion
2010 Registered outward investment US$15.05 billion
2010 Registered mainland China-bound investment US$12.23 billion
2010 4th-largest holder of foreign exchange reserves
2010 16th-largest exporter of merchandise
2010 17th-largest importer of merchandise
2010 24th-largest exporter of commercial services
2010 28th-largest importer of commercial services
*Based on 2006 constant prices
Sources: Directorate-General of Budget, Accounting and Statistics, Executive Yuan; Ministry of Economic Af-
fairs; Central Bank of the Republic of China; International Monetary Fund; World Trade Organization
The biggest contributor to GDP, at points from the previous year. In 2010,
67.08 percent, was the service sector, its industrial production index grew
which employed 58.84 percent of the 28.60 percent year-on-year, with large
work force. Industry (manufacturing, con- increases in production of machinery
struction, utilities, mining and quarrying), and electronic components.
comprising 35.92 percent of the work Small and medium-sized enterprises
force, contributed 31.34 percent of GDP. (SMEs) have continued to play a critical
Agriculture, with 5.24 percent of workers, role in the economy. According to the
made up the remaining 1.58 percent. Ministry of Economic Affairs (MOEA),
Compared with 1986, when the con- SMEs in Taiwan numbered about 1.25
tribution to GDP of the manufacturing million at the end of 2010, accounting
segment of the industrial sector peaked for 97.68 percent of all enterprises. They
at 37.48 percent, its contribution in 2010 employed 8.19 million workers, or 78.06
was 26.27 percent, up 2.44 percentage percent of the total work force. SMEs’
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5. 8 Economy
sales of goods and services comprised
29.55 percent of all sales and made up
encouraged the development of new tech-
nologies and products by SMEs under the
16.88 percent of total export value in 2010. Small Business Innovation Research Pro-
SMEs’ actual contribution to total gram 小型企業創新研發計畫, which offers
export sales and the economy as a whole, subsidies covering up to 50 percent of
however, is much greater than these their R&D costs. The Small and Medium
figures suggest, considering their impor- Enterprise Credit Guarantee Fund of
tant role in the upstream value chains Taiwan 中小企業信用保證基金, which pro-
supporting larger-scale enterprises’ vides guarantees for bank loans to busi-
production and exports. To enhance their nesses, was also expanded to NT$842.8
performance, the ROC government has billion (US$26.64 billion) in 2010.
Composition of GDP by Sector in 2010
Share of Annual Change Annual Change
Sector of Economy GDP1 in GDP in Output
(%) Share (%) Value2 (%)
Agriculture (5.24% of work force) 1.58 -0.16 -0.58
Industry (35.92% of work force) 31.34 2.38 18.52
Manufacturing 26.27 2.44 20.71
Construction 2.77 0.09 13.41
Electricity and natural gas 1.20 -0.17 -3.58
Water supply and remediation services 0.63 -0.03 3.85
Mining and quarrying 0.46 0.04 21.88
Services3 (58.84% of work force) 67.08 -2.22 6.00
Wholesale and retail trade 18.19 -0.48 6.66
Real estate 8.59 -0.58 2.55
Public administration and defense 7.26 -0.39 3.89
Finance and insurance 6.37 -0.04 8.91
Education 4.62 -0.37 1.42
Information and communications 3.47 -0.23 2.97
Health and social services 3.03 -0.15 4.23
Transportation and storage 3.04 -0.01 9.32
Professional, scientific and
technical services 2.24 -0.05 7.16
Accommodation and food services 1.97 -0.08 5.26
Support services 1.46 -0.01 8.70
Arts, entertainment and recreation 0.90 -0.05 4.53
Other services 2.98 -0.14 4.67
Service-related value-added tax 1.83 0.17 20.73
Service-related import duties 1.12 0.18 29.79
1
2010 GDP: US$430.10 billion
2
Based on New Taiwan dollar data
3
Includes import duties and value-added tax
Note: Figures do not add up to 100 percent due to rounding off.
Source: Directorate-General of Budget, Accounting and Statistics, Executive Yuan
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6. Central Government Financial Services
Revenues and Expenditures Banking
According to the Executive Yuan’s With increased economic activity and
Directorate-General of Budget, Account- private-sector investment, bank credit
ing and Statistics 行政院主計處, in the 2010 expanded in 2010, raising the annual av-
fiscal year, central government revenues erage growth rate of the broadly defined
fell 3.2 percent from the previous year money supply (M2) by 4.59 percent to
to NT$1.50 trillion (US$47.41 billion), NT$31.04 trillion (US$980.85 billion) by
while government expenditures de- the end of the year. The Central Bank of
creased by 3.5 percent to NT$1.66 trillion the Republic of China 中央銀行 tightened
(US$52.47 billion). (See pie chart “Final its monetary policy, raising the discount
Accounts of FY 2010 Central Govern- rate three times during the year to 1.625
ment Revenues and Expenditures.”) percent by year-end, after having cut
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7. 8 Economy
Structure and NPL Ratios of Banking Sector in 2010
Type of Institution No. of No. of Share of Share of NPL
Institutions Branches Deposits1 (%) Loans2 (%) Ratio (%)
Domestic banks 37 3,334 76.95 92.29 0.61
Foreign banks 28 92 1.31 2.40 0.22
Credit cooperatives 26 261 1.84 1.69 0.57
Credit departments of farmers’
and fishermen’s associations 301 852 4.98 3.62 3.15
Bills finance companies 9 30 ---- ---- ----
Postal savings system 1 1,321 14.92 ---- ----
1
Total deposits (December 2010): NT$30.15 trillion (US$952.89 billion)
2
Total loans (December 2010): NT$19.86 trillion (US$627.72 billion)
Source: Financial Supervisory Commission, Executive Yuan
interest rates seven times from late 2008 determine if they would have enough
to early 2009. The discount rate was fur- liquidity to withstand the potential im-
ther raised to 1.875 percent in July 2011. pact of the year-end expiration of the full
At the end of 2010, there were a total deposit guarantee policy implemented in
of 402 banking institutions in operation (see late 2008 amid the global financial crisis.
table “Structure and NPL Ratios of Bank- In recent years, domestic banks have
ing Sector in 2010”). As of that time, year- established footholds overseas, in part,
on-year, Taiwan’s 37 domestic banks saw to better serve Taiwanese firms operat-
their total assets increase by 6.62 percent ing abroad, particularly in Vietnam and
to NT$32.76 trillion (US$1.04 trillion) and mainland China. Of the 266 branches
their net worth by 7.90 percent to NT$2.09 and liaison offices established worldwide
trillion (US$66.03 billion). Over 2010, by 2010, 57 were in Vietnam and 13 in
their deposits expanded 6.64 percent to mainland China.
NT$23.20 trillion (US$733.31 billion),
while their loans increased 7.33 percent to
NT$18.33 trillion (US$579.28 billion). Insurance
Domestic banks also showed steady According to a “sigma” study released
improvement in asset quality. At the end by global reinsurer Swiss Re, Taiwan had
of 2010, all had non-performing loan the world’s highest insurance penetration
(NPL) ratios of less than 2 percent, with a rate of 17.29 percent in 2010, while its
record-low average of 0.61 percent; their insurance density—or insured amount
coverage ratios of allowances for NPLs, per capita—reached US$2,758, the 18th-
meanwhile, climbed to a record-high highest worldwide and the third-highest
158.07 percent; and their average capital in Asia. According to the study, the com-
adequacy ratio was 11.97 percent, well bined premium income of Taiwan’s insur-
above the regulatory requirement of 8 ance industry was the 13th-largest in the
percent. All domestic banks passed stress world, accounting for 1.55 percent of the
tests conducted by the Executive Yuan’s global market in 2010.
Financial Supervisory Commission 行政 As of December 2010, there were
院金融監督管理委員會 in August 2010 to 57 insurance companies operating in
108
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8. Taiwan, including three reinsurers, 31 life 所, with total market capitalization of
insurers (eight foreign) and 23 non-life NT$23.01 trillion (US$779.81 billion).
insurance firms (six foreign). Insurance The value of shares traded on the bourse
industry assets stood at NT$12.45 trillion in 2010 dropped 4.93 percent from 2009
(US$393.36 billion), or 27.68 percent of to NT$28.22 trillion (US$891.81 billion),
the financial sector’s total assets. while trading volume fell 24.91 percent to
In 2010, total insurance premium 817.57 billion shares.
income increased 14.73 percent over The TAIEX, the benchmark index
the previous year to NT$2.42 trillion of the TWSE, nevertheless rose by 9.58
(US$76.45 billion). The proportion of percent to a high of 8,972.50 points at
that amount received by life insurance the end of 2010 from the 2009 high of
operations was nearly 22 times greater 8,188.11 points, which likewise occurred
than that received by non-life insurance at the end of that year. It continued to rise
operations. While the life insurance seg- in the early months of 2011 before drop-
ment has enjoyed steady growth in recent ping to 8,652.59 points at the end of June.
years, the non-life segment in 2010 expe- The over-the-counter GreTai Securi-
rienced positive growth for the first time ties Market 證券櫃檯買賣中心 index, mean-
in five years. Life insurance companies while, slipped 4.07 percent from 150.05
paid out NT$1.19 trillion (US$37.65 points in early 2010 to 143.95 points at
billion) in claims, and non-life insurers year-end and then moved down further to
NT$62.25 billion (US$1.97 billion). 134.04 points at the end of June 2011.
Foreign investors and mainland Chi-
nese QDIIs (qualified domestic institu-
Securities tional investors) bought NT$5.37 trillion
As of June 2011, 767 stocks issued by (US$169.69 billion) and sold NT$5.09
763 companies were listed on the Taiwan trillion (US$160.81 billion) worth of
Stock Exchange (TWSE) 臺灣證券交易 shares on the TWSE in 2010. From
Vibrant economic
activity in 2010,
supported by
increased private
consumption and
record growth in
trade, boosted
investor confidence
and spurred a
9.6-percent rise
in the benchmark
TAIEX stock index
as of year’s end.
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9. 8 Economy
January to June 2011, their cumulative
purchases and sales, respectively, reached
Its top import sources were Japan, main-
land China and the ASEAN-6. Data on
NT$3.01 trillion (US$101.95 billion) and Taiwan’s principal trade partners and the
NT$2.99 trillion (US$101.17 billion). export value of its merchandise by cat-
Their investments accounted for 31.19 egory in 2010 are listed in the pie chart
percent of the market value at the end of and table so labeled.
2010, increasing slightly to 31.39 percent Merchandise export orders in 2010
at the end of June 2011. As of that time, advanced an average 26.1 percent over the
30 TWSE-listed companies had issued preceding year to an all-time high value
Taiwan Depositary Receipts 臺灣存託憑證. of US$406.72 billion. About 27 percent
It is projected that by 2013, an ad- of the orders came from mainland China,
ditional 330 foreign companies will be- due in part to the lowering of tariffs under
come listed on Taiwan’s stock markets the Cross-Straits Economic Cooperation
and thereby raise some NT$268 billion Framework Agreement (ECFA) 海峽兩岸經
(US$9.08 billion) in funding. 濟合作架構協議, which came into effect in
September 2010.
Foreign Trade and Investment For the first time, in 2010, more than
After declining by 23.8 percent in 50 percent of the export orders received
2009, Taiwan’s foreign trade surged more were filled by Taiwanese-operated
than 50 percent in the first half of 2010 factories abroad—mostly in mainland
compared with the same period in the pre- China—which assemble a large share
vious year but tapered off to a 27-percent of the world’s sophisticated consumer
increase year-on-year in the following six electronics, such as notebook comput-
months. Overall, trade value expanded ers, smartphones and tablet computers.
39 percent year-on-year to US$526 bil- Manufacturers in Taiwan nevertheless
lion, with exports rising by 34.8 percent benefited from this arrangement, as
to US$274.60 billion and imports grow- they supplied overseas factories with
ing by 44.1 percent to US$251.24 billion integrated-circuit chips, flat-panel dis-
in 2010. plays and other high-tech components
necessary to make such products.
This record growth in trade moved
Taiwan up a notch over 2009 to become As for the movement of direct invest-
the world’s No. 16 exporter of merchan- ment capital into and out of Taiwan, in
dise, while remaining the No. 17 importer 2010, US$3.91 billion in incoming invest-
of merchandise in 2010. With a trade sur- ments and US$15.05 billion in outbound
plus of US$23.36 billion in 2010, down investments were officially registered.
20.3 percent from 2009, Taiwan ended These figures represented a decrease of
the year with foreign exchange reserves 19.22 percent and an increase of 66.08
of US$382.01 billion, the fourth-highest percent, respectively, over the previous
in the world. year. About 32.39 percent of inbound in-
Mainland China remained Taiwan’s vestment went to banking and insurance,
largest export market in 2010, followed and 10.14 percent to manufacturing. Of
by the ASEAN-6 (six trading partners registered outbound investment capital,
belonging to the Association of Southeast US$12.23 billion, or 81.26 percent, was
Asian Nations—Indonesia, Malaysia, headed for mainland China. Investment in
the Philippines, Singapore, Thailand and electronic component manufacturing ac-
Vietnam), the United States and Europe. counted for 21 percent of this total.
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10. Policy Initiatives starting businesses and to strengthen cor-
porate governance. A one-stop service for
Investment Promotion online application for business registra-
In 2010, private investment played an tion was launched in May 2011. Other
important role in the economy’s recovery, regulatory revisions in 2010 include
with a year-on-year rise of 33 percent. To lowering of the corporate income tax rate
make Taiwan a more attractive investment from 25 to 17 percent and adjustment of
destination for both foreign and domestic the scope of tax credits for research and
interests, the Executive Yuan and the Leg- development expenditures.
islative Yuan have given priority to such Hoping to build on Taiwan’s strengths
broad measures as removing barriers to and on improving cross-strait relations,
investment, improving the tax environment the Executive Yuan Council (Cabinet)
and modernizing public infrastructure. established a global investment task
The Company Act 公司法 was revised force in August 2010 to coordinate ef-
in July 2010 to simplify procedures for forts to solicit investment in Taiwan by
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11. 8 Economy
Export Value of Merchandise by Category in 2010
Export Annual Percentage
Merchandise Category Value Change of Total
(US$ billion) (%) Export Value*
All categories (total export value) 274.60 34.82 100.00
Electronics 77.31 36.43 28.15
Precision instruments (including digital cameras) 23.62 46.85 8.60
Plastics/rubber and articles thereof 22.25 34.69 8.10
Chemicals 19.23 38.02 7.00
Machinery 16.73 52.23 6.09
Iron and steel products 16.38 32.91 5.96
Other metallic products 9.51 35.09 3.46
Mineral products (mostly refined petroleum) 14.85 26.92 5.41
Information and communications products 14.10 53.34 5.13
Textile products (mostly yarns and fabrics) 11.30 20.95 4.12
Electrical machinery products 11.28 21.10 4.11
Vehicles, boats and transportation-related products 9.33 20.78 3.40
Other goods 28.71 25.72 10.46
*Percentages of total export value do not add up to 100 due to rounding off.
Source: Department of Statistics, Ministry of Finance
foreign multinational corporations as well green construction, electric vehicles,
as by overseas-based Taiwanese firms. urban renewal, creation of a “Taoyuan
A single-window service center was set aerotropolis,” high-tech clustering in
up to match investors with business op- central Taiwan and international promo-
portunities, address overseas businesses’ tion of Taiwanese cuisine. The CEPD
operational and investment concerns, and anticipates attracting investments worth
provide customized service. NT$434 billion (US$14.71 billion)
Under the overall coordination of the through such promotions.
Executive Yuan’s Council for Economic
Planning and Development (CEPD) 行 Trade Enhancement
政院經濟建設委員會 , R O C g o v e r n m e n t
The MOEA has launched a series
agencies have formulated a wide variety of trade promotion programs in recent
of “flagship plans” (see section below years. Implemented in 2008, the New
under that heading) in consultation with Zheng He Plan 新鄭和計畫 provides ex-
the private sector for investment promo- port financing to Taiwanese businesses
tion. The global investment task force while helping them develop markets
and other government-organized groups in the mainland Chinese and emerging
have given numerous presentations economies, bid on foreign government
overseas and at home, with first-round procurement programs and extend their
promotion focusing on the areas of bio- services globally. In 2010, NT$7 bil-
technology, medical tourism, cultural and lion (US$221 million) was invested in
creative industries, smart handheld devic- this plan, creating business opportuni-
es, cloud computing, renewable energy, ties worth US$22.9 billion.
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12. A three-year program to promote high- For conventional industries such as
quality, affordable products in emerging shoe and textile manufacturing that have
markets was initiated in 2010, focusing on been impacted by mounting competition
the rapidly growing middle-class popula- from emerging economies with low labor
tions in four emerging markets—mainland and land costs, the MOEA initiated as-
China, India, Indonesia and Vietnam. sistance programs in 2010 to facilitate
Under this program, comprehensive business-academia collaboration, indus-
support has been provided to Taiwanese trial clustering and consultation with
firms to enhance their capabilities in public research organizations such as the
technology development, production, Industrial Technology Research Institute
design, branding and marketing, thereby 工業技術研究院 (see Chapter 9, “Science
helping them create trade opportunities. and Technology”) in order to help busi-
During its first year of implementation, nesses switch to manufacture of higher-
the program has promoted the image of value products.
Taiwanese products in the four markets, To protect intellectual property rights
generating US$16.2 billion worth of and enable patented innovative products
business opportunities. to come to the market quickly, the Cabi-
To facilitate overseas sales of superior net has established a program to invest
Taiwan-made products, in October 2010, NT$11.8 billion (US$372.92 million)
the Cabinet approved a plan to develop from 2010 to 2015 to fund a patenting
the logistics service industry calling consultation center to promote the com-
for an investment of NT$101.1 billion mercialization of innovative products.
(US$3.2 billion). Scheduled for comple-
tion in 2013, the plan aims to upgrade
airport and harbor infrastructure, boost
Employment
customs clearance efficiency and pro- Thanks in part to strong recovery from
mote cross-border cooperation. In addi- the global economic recession that began
tion to benefiting exporters, it is expected in late 2008, Taiwan’s unemployment
to spur integration of regional supply rate dropped to 4.67 percent in Decem-
chain resources. ber 2010 after peaking at 6.13 percent in
August 2009. The number of employed
increased by 2.21 percent year-on-year to
Industrial Innovation 10.61 million at the end of 2010. Salaries
Increasingly sharp economic competi- also fared well in 2010, with the average
tion as well as new opportunities stemming monthly wage for the combined industrial
from globalization and the rise of newly and service sectors growing 3.75 percent
industrialized economies have underlined year-on-year to NT$44,396 (US$1,403)
the imperative for Taiwan’s businesses to as of December 2010.
place greater importance on innovation. Government employment policies,
Among the several measures taken to en- including provision of short-term pub-
courage such efforts is the enactment of lic employment, subsidization of wages
the Industrial Innovation Act 產業創新條例 for new hires, and training programs,
in 2010. The act offers a tax credit on 15 have also played a role in improving the
percent of innovative research expendi- employment picture. In recognition that
tures as well as various subsidies over the only a vibrant economy can ensure long-
period 2010 to 2019. In addition, it liberal- term employment stability, the admin-
izes criteria for receiving R&D tax credits. istration of President Ma Ying-jeou has
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13. 8 Economy
With public- and
private-sector
support, artists
and designers
are blending
creativity with
cultural tradition to
produce distinctive
works such as
this decorative
porcelain piece.
put emphasis on expediting industrial digital content industries;
renovation and catalyzing the develop- •• Forming a series of innovative technol-
ment of new types of businesses and busi- ogy corridors utilizing science parks;
ness opportunities in all sectors. •• Regenerating urban areas and indus-
trial parks;
Flagship Programs •• Rejuvenating rural communities;
The Ma administration has pushed •• Developing fishing villages and ma-
forward a number of “flagship programs” rine recreation;
aimed at promoting sustainable economic •• Creating lowland forest reserves;
development and enhancing the qual- •• Managing water resources and carry-
ity of life in Taiwan. Among them are ing out flood prevention engineering
the i-Taiwan 12 Projects 愛臺十二建設, projects; and
which focus primarily on public infra- •• Constructing sewer systems.
structure. Scheduled for completion by Also underway are programs worth
2016 at a projected cost of NT$4 trillion NT$216.02 billion (US$6.83 billion)
(US$126.42 billion), about one-third of aimed at stimulating the development of
which is expected to come from private six emerging industries between 2009
investors, the projects include: and 2013:
•• Modernizing transportation infrastructure; •• Biotechnology, with focuses on R&D,
•• Renovating the Kaohsiung harbor re- drug testing and setting up a venture
gion 高雄港區, including upgrading of capital fund and a biotech business in-
its port facilities; cubation center;
•• Developing Taiwan Taoyuan Interna- •• Tourism, aimed at enhancing the qual-
tional Airport 臺灣桃園國際機場 and its ity of travel in Taiwan and stimulating
environs into an “aerotropolis”; regional development in all parts of
•• Enhancing high-tech industrial clustering; the island;
•• Developing wireless broadband and •• Green energy, including development
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14. of photovoltaics, LED lighting, wind innovation-oriented industries, urban re-
energy, hydrogen and fuel cells, energy- newal, international promotion of Taiwan-
saving ICT and electric vehicles; ese cuisine, MICE (meetings, incentives,
•• Medical care, with attention to long- conferences and exhibitions), development
term care, improved quality of care in of WiMAX technology, Chinese-language
rural communities and medical tourism; e-commerce and expanded recruitment of
•• High-end agriculture, focusing on students from overseas.
organic farming, agritourism, export Development programs in these
expansion and regeneration of rural fields are expected to generate private
communities; and investment of NT$400 billion (US$12.64
•• Cultural and creative industries, includ- billion) and create an output value of
ing television, filmmaking, pop music, over NT$1 trillion (US$31.60 billion) by
crafts, design and entertainment-related 2013. Insofar as possible, programs are
digital content. being designed with a view to helping
Programs have also been launched to bridge the urban-rural gap in living stan-
expedite the development of four “intel- dards, balance income distribution and
ligent” industries aimed at maintaining improve the quality of life society-wide.
information technology competitiveness,
cutting carbon dioxide emissions and Cross-Straits Economic Cooperation
conserving energy. About NT$17.95 bil-
lion (US$567.28 million) in public fund- Framework Agreement
ing is expected to be spent between 2010 The ECFA took effect on September
and 2016 in the following areas: 12, 2010 (see Chapter 6, “Cross-strait
•• Cloud computing, aimed at raising Relations”), constituting a milestone in
government efficiency, enhancing the the normalization of economic relations
added value of IT hardware and stimu- between Taiwan and mainland China.
lating the development of industries Under the ECFA, tariffs on 539
across the board; Taiwan-made products and 267 mainland
•• Electric vehicles, with attention to both goods in the “early harvest program” are
vehicle manufacturing and development to be reduced and eventually eliminated
of infrastructure conducive to the use of in three stages by the end of 2012. The
such vehicles; pact also calls for follow-up negotiations
•• Green architecture, integrating ICT on trade in goods, trade in services, in-
with eco-friendly construction and vestment and dispute settlement.
other technologies; and Since the signing of the ECFA, for-
•• Patent commercialization, providing eign investors have shown greater interest
consultation and other services to help in investing and raising capital in Taiwan.
bring innovative ideas to market. It has also put Taiwanese businesses on
Given that the service sector is the a more level playing field with other
biggest contributor to GDP and em- countries’ competitors in the mainland
ploys the most people, a number of the Chinese market. Further, it is expected to
aforementioned areas as well as others improve conditions for Taiwan’s negotia-
are receiving special attention. These tion of trade agreements with other na-
include development of medical tourism, tions while helping domestic companies
music and digital content, international diversify investments and expand their
logistics, fundraising for high-tech and global presence.
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15. 8 Economy
l Ministry of Economic Affairs: http://www.moea.gov.tw
Related l Council for Economic Planning and Development, Executive Yuan:
Websites http://www.cepd.gov.tw
l Directorate-General of Budget, Accounting and Statistics, Executive Yuan:
http:// www.dgbas.gov.tw
l Bureau of Foreign Trade: http://www.trade.gov.tw
l Industrial Development Bureau: http://www.moeaidb.gov.tw
l Investment Commission: http://www.moeaic.gov.tw
l Small and Medium Enterprise Administration: http://www.moeasmea.gov.tw
l Intellectual Property Office: http://www.tipo.gov.tw
l Central Bank of the Republic of China: http://www.cbc.gov.tw
l Financial Supervisory Commission, Executive Yuan: http://www.fscey.gov.tw
l Ministry of Finance: http://www.mof.gov.tw
l Taiwan Stock Exchange Corp.: http://www.twse.com.tw
l GreTai Securities Market: http://www.otc.org.tw
l Taiwan Futures Exchange: http://www.taifex.com.tw
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