Manpower shortage holding back Taiwan, says AmCham
Tim Culpan in Taipei
Inadequate human resources and infrastructure policies are among the key problems for Taiwan's economic development, according to the annual White Paper of the American Chamber of Commerce in Taipei.
Health care, financial reform and direct links with China are also on the list of items Taiwan needs to improve to remain competitive and attractive to foreign business.
'The economy is really modernising and what that means is a shift from manufacturing to services ... but there are whole areas where services are lagging,' said Richard Vuylsteke, the executive director of AmCham Taipei.
The top concern for multinational chief executives in Taiwan is the excessive bureaucracy involved in hiring foreign staff. The restrictive environment is even worse when it comes to mainlanders.
'Virtually all multinational companies now have employees who are PRC nationals; for such companies it is too cumbersome, if not risky, to plan events in Taiwan that require participation by staff members with Chinese passports,' AmCham says in its 48-page paper.
The restrictions on hiring mainlanders compounds the problems caused by the lack of direct transport between Taiwan and China.
The result for Taiwan is that companies are taking their regional headquarters elsewhere, not because of cheaper labour but because of ease of movement and hiring.
Also of concern to foreign businesses is the health-care environment, which AmCham says is restrictive and unfair to foreign players.
On the issue of infrastructure, AmCham said that Taiwan still suffers from unreliable power and water supplies while transport and logistics services lag behind Asian competitors.
Winning guarded congratulations from AmCham this year are Taiwan's recent efforts on intellectual property protection which have seen improvements in legislation and enforcement.
However 'the judiciary is still giving slap on the wrist types of punishments' for offences, it said.