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Taiwan Business Report 2018

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Discovery Reports

New national arts centre reflects Taiwan’s economic success

  • Taiwan’s new national arts centre is an impressive status symbol which reflects the country’s rising prestige in the economic sphere
PUBLISHED : Wednesday, 21 November, 2018, 5:04pm
UPDATED : Wednesday, 21 November, 2018, 5:04pm

When the US$330 million National Kaohsiung Centre for the Arts – usually known as Weiwuying – opened in a blaze of publicity last month, the message it delivered was not only cultural.

Built on the site of a former military training base, Weiwuying signalled a shift in Taiwan’s international status. Long hailed as one of Asia’s doughtiest “tigers”, Taiwan’s gigantic new arts hub showed that it has the capacity to celebrate culture in a big way.

The centre was designed by Dutch firm Mecanoo Architects and comprises an opera house, concert hall, theatre and recital hall, seating for up to 7,000 people, and the world’s biggest organ, which is built to represent two thickets of bamboo with more than 9,000 pipes. In short, Weiwuying is one of the greatest status symbols imaginable.

Weiwuying opened around the time that Taiwan was being subjected to a steady stream of praise for the strides it has made in its economy.

Firstly, the International Monetary Fund (IMF) raised its forecasts for the country’s gross domestic product growth both in 2018 and 2019 to 2.7 per cent, up 0.8 percentage points from a previous estimate in April.

The IMF’s figures chimed with the 2.69 per cent growth projected by Taiwan’s Directorate General of Budget, Accounting and Statistics.

Taiwan was the only economy among the four Asian Tigers, a group which includes commercial rivals South Korea, Hong Kong and Singapore, to see its growth forecasts raised by the IMF for both years.

Secondly, similarly good news was broadcast by Moody’s Investors Service, which declared that Taiwan’s sound economic prospects, steady corporate finances, and solid government support will help buoy the nation’s banking system over the course of the next 12 to 18 months.

Moody’s vice-president and senior credit officer Sonny Hsu notes that steady economic growth and strong corporate balance sheets will support the asset quality of banks in Taiwan.

“Moreover, the system will maintain steady capitalisation and very ample liquidity.

Our outlook is consistent with the stable outlooks for the 11 banks that we rate in this system,” Hsu adds.

Taiwan’s overall economic statistics paint a similarly healthy picture. According to a report released by the Investment Commission of the Ministry of Economic Affairs, Taiwan’s approved foreign direct investment for the first six months of this year totalled US$3 billion, a slight fall over the same period last year.

The commission’s executive secretary, Emile Chang, suggests that the drop is down to the fact that the numbers for 2017 were particularly high because of heavy investment by Micron, the American semiconductor manufacturer.

Chang adds that several companies have postponed their investment plans to the second half of 2018, and it is likely the year-end total will finish higher.

Taiwan’s imports and exports in the first half of 2018 were valued at US$302 billion, an increase of just under 11 per cent from the same period last year. Exports hit US$163.8 billion and imports US$138.3 billion, both up by nearly 11 per cent.

Taiwan has built itself up in the past half-century primarily by a concentrated export drive, and by forging a solid reputation for quality and reliability.

Its current principal exports are electrical machinery, computers, plastics, optical, technical, and medical apparatus, mineral fuels including oil, motor vehicles, iron, steel and copper, and organic chemicals.

From January to June 2018 Taiwan maintained a favourable trade balance of US$25.5 billion, an increase of 11 per cent. In trade with the US, both exports and imports increased in the first half of 2018 by 8 per cent compared to 2017.

Exports to China and Hong Kong rose 14.2 per cent and imports 12 per cent. The export value of electronic components and parts surged by 17 per cent, and machinery by just under 16 per cent.

Along with enjoying a sterling reputation as an exporter, Taiwan is one of the world’s leading producers of communication technology and information products.

The World Economic Forum has ranked Taiwan 15th out of 137 economies in the Global Competitiveness Report, and since 2014, the National Science Council has been known as the Ministry of Science and Technology (MOST).

MOST is the government dedicated agency charged with advancing science and technology development, supporting academic research and promoting the nation’s three science parks.

Along with continuing its predecessor’s innovative measures and programmes, MOST focuses on academic research that services the needs of industry.

Taiwan relies on innovations in science and technology to drive economic growth and national progress.

The success of Taiwan’s hi-tech enterprises is largely attributable to the government’s generous funding of applied scientific development.

With government support, the Industrial Technology Research Institute, the National Applied Research Laboratories and the Institute for Information Industry all important roles in jump-starting the nation’s rise as a technological powerhouse.

They conducted research, aided the private sector with R&D, and explored innovative new technologies.

Taiwan is also regarded as a highly successful incubator for start-ups, with the island’s more ambitious entrepreneurs talking about turning it into Asia’s Silicon Valley.

Taipei has joined forces with Tesla – the California-based automotive and energy corporation – to establish a 1.5 hectare hub to help start-ups find their footing and train for new energy ventures in the city.

Tesla sees the project as a source for innovations that it can funnel into its suite of electric vehicle, battery, solar, and energy storage products. As companies mature in the incubator, Tesla will get first shot at the new tech.

In exchange, Tesla moved into the new hub in August and built a creative energy exhibition park, and an electric vehicle experience centre.

It intends to stage workshops for students featuring cutting-edge products, and will also provide training.