Taiwan needs foreign investors for growth, but hurdles remain
Taiwan has initiated many programmes to attract more foreign talent and investors to set up business in Taiwan. The fact that Taiwan is battling a brain drain, with youngsters increasingly drawn to studies and a career abroad, means it needs more outside talent to help boost the economy.
Entrepreneurs not only drive economic growth, but they also provide jobs for the local population.
However, entrepreneurs from overseas still face some barriers in setting up business in Taiwan.
One is the language barrier, since there are fewer English-speaking people in Taiwan than in Hong Kong or Singapore. To learn about the market, find strategic partners and investors, and market their product, foreign entrepreneurs who don’t have Chinese-language skills rely heavily on their local partners. Without a common medium of communication, people find it hard to build relationships, which is an important determinant of business success.
Another problem is the conventional banking system. The high cost of international transactions and foreigners’ difficulty in obtaining a loan often demotivate entrepreneurs.
Worries about the island’s longer-term economic outlook and the trend of local companies investing abroad also make foreigners pessimistic about pursuing their business ideas in Taiwan.
Finally, there is the issue of intellectual property rights protection: the risk of imitation of innovation. This is a major challenge for foreign entrepreneurs. If not properly addressed, inadequate IP protection will be a barrier to growth, no matter how supportive other government policies are.
Donny Susilo, Taichung City