Tyng-Hwa Wang Deputy Director General Industrial Development and Investment Center Ministry of Economic Affairs September 2002 Your Ideal Choice For Investment.

Tyng-Hwa WangDeputy Director General

Industrial Development and Investment CenterMinistry of Economic Affairs

September 2002

Your Ideal Choice For Investment

Chinese Taipei

2

Our Geographic Advantage

Gateway to the Asia-Pacific Region

Hub connecting three Asian

Economic Regions

Chinese Taipei

Per capita GNP from US$196 to US$ 12,941

Foreign trade volume from US$300 million to 230.1 billion

Foreign exchange reserves of US$155.3 billion （ July 2002） , ranking 3th worldwide

Change in CPI mostly under 5%

Unemployment rate always under 5%

Our Economic Development （ 1952-2001）

2

4

19.7

30.2

23.6

1.92.13.54.25.8

15.512.7

7.7

32.228.5 36.8

39.930.932.4

36.441.246.3

26.9

45.7

48.144.6 46.2 47.7 47.4

67.265.6

60.1

54.647.946.6

0

10

20

30

40

50

60

70

80

90

100

1952 1960 1965 1970 1975 1980 1985 1990 1995 2000 2001

Agriculture

Industry

Services

Structure of Production

（% of GDP by Sector）

%

Source: Council for Economic Planning and Development

5

British Territories7,468 (15%)

Japan9,896 (20%)

USA11,693 (24%)

Switzerland

430 (1%)

Netherlands

2,154 (4%)

UK

2,024 (4%)

Germany

748 (2%)

Singapore3,831 (8%)

Hong Kong3,697 (7%)

Others

7,510 (15%)

Source: Investment Commission, MOEA,

Unit: US$ million

4,185

7711,183

2,461

2,925

1,6311,213

1,4611,778

2,3023,295

4,267

7,608

703404 559

380395466

5,128

1,419

2,418

-

2,000

4,000

6,000

8,000

1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001

US$ million

Foreign Direct Investment inflow

Sources of Foreign Investment

(accumulated 1952 to 2001)

6

Unit: US$ million

Our Investment in China and Southeast Asia

Host Economy Statistics

（to year-end 2001） Investment Area

No. Cases Value % of Total Investment

Rank

China 51,528 55,470 57.09% 4

Indonesia 905 12,879 13.26% 5

Thailand 1,603 10,510 10.82% 3

Malaysia 1,836 9,186 9.45% 3

Vietnam 840 5,645 5.81% 2

Singapore 380 2,223 2.29% --

Philippines 856 756 0.78% 5

Cambodia 175 494 0.51% 2

7

Core Competitive Advantages of Our Industries

1. Abundant manufacturing competence, engineering capability, and logistics experience.

2. Major industries have a complete industrial development system with a full division of labor and a strong flexibility for coping with environmental change.

3. Domestic enterprises have rich international experience, a strong ability to grasp market trends, and the capability of developing new products rapidly in response to new market opportunities.

4. Chinese Taipei is among the world’s top three producers of a number of electronic products. Massive outward investment has built up complete supply systems.

8

Our Industry Clusters Advantage

Chinese Taipei’s World Ranking as a Product SupplierChinese Taipei’s World Ranking as a Product Supplier

Source: Industrial Technology Department, Ministry of Economic Affairs

Wafer foundry

Mask ROM

IC packaging

Motherboards

Notebook computers

CDR optical disks

CD-RW disks

DVD-Video disks

HUBs

Analog Modems

Network cards

ABS resin

Home sewing machines

Hand tools

PU leathers

IC design

TFT-LCDs

TN/STN LCDs

PC Cameras

Digital Cameras

Cable Modems

Switches

Resistors

LEDs

Scanners

Polyester filaments

Nylon fiber

Fastener

Wood processing machines

Printed circuit boards

Monitors

Polyester staple fiber

Polyvinyl chloride (PVC)

Purified terephthalic acid

(PTA)

Bicycles

No. 1 No. 2 No. 3

9

Our Advantage in R&D Capability

1,897 2,057

3,693

4,667

3,1007 7

5

7

4

0

1000

2000

3000

4000

5000

6000

7000

8000

1996 1997 1998 1999 2000

1

4

7

10

RankCases

Number of U.S. Patents Granted, andChinese Taipei's Ranking

4.795.025.5 5.65

6.07

2.05% 2.05%1.98%1.88%1.80%

0

1

2

3

4

5

6

7

8

9

10

1996 1997 1998 1999 2000

0.00

0.50

1.00

1.50

2.00

2.50

3.00US$ billion % of GDP

R&D Expenditures and percentage ofGDP

10

Source: World Economic Forum, The Global Competitiveness Report 2001-2002

World Economic Forum The Global Competitiveness Report 2001-2002

Criteria

Finland U.S.A. Singapore Chinese

Taipei

Hong Kong

Japan Korea Malaysia Thailand China

Growth Competitiveness

1 2 4 7 13 21 23 30 33 39

1. Technology 3 1 10 4 33 23 9 22 39 53

a. Innovation 4 2 19 3 24 17 6 50 47 63

b. Information & Communication

1 5 4 16 10 23 21 33 53 56

2. Public

Institution1 12 6 24 10 19 44 39 42 50

3. Macroeconomic

Environment10 7 1 15 4 18 8 20 16 6

11

Our Advantage in Communications

Online population of about

7.28 million for a penetration

rate of 35%, with more than 1

million broadband

subscribers.

Cell phone users top 20.97 million for a penetration rate of 94% -- highest in the world.

12

Our Advantage in Venture Capital Growth of venture capital industry 2nd globally only to the US.(1)

Venture capital availability 1st in Asia (13th in the world).(2)

Key factors for a successful VC business (1)

Source: (1)Venture Capital Association, 2001 (2)The Global Competitiveness Report 2001-2002

36

67

72

42

24

926

1,306

2,263

3,293

3,882

0

10

20

30

40

50

60

70

80

1996 1997 1998 1999 2000

%

0

500

1000

1500

2000

2500

3000

3500

4000

4500US$ Million

Annual Growth Rate Paid-in Capital Amount

Chinese Taipei

Japan

Korea

H.K.

Singa-pore

China

Capital ˇ × ˇ ˇ

Technology ˇ ˇ × ˇ

People

Entrepreneurs

Venture Capitalists

ˇ ˇ

× ˇ

× ˇ

ˇ ×

Equity Market ˇ × ˇ ×

13

JFKLHR

TokyoSeoul

Shanghai

HongKong

Manila

TAIPEISingapore

Shortest average sailing time to 5 major regional harbors: 53 hours

Shortest flying time to 7 main cities of the Western Pacific: 2.55 hours

Average flying time among 7 majorairports in Asia Pacific

Sydney Singapore Tokyo Seoul Manila Shanghai HK Taipei

6:15

4:554:15 4:00

3:30 3:25 3:052:55

Singapore Tokyo Shanghai Manila HK Kaohsiung

53

124

78

64

Unit: hour

110

68

Average sailing time among 5 major harbors in Asia Pacific

Our Advantage in Transportation

Source: Council for Economic Planning and Development

14

Challenge 2008 Development Plan

Cultivate Talent

for the E-generation

Cultivate Talent

for the E-generation

Increase Value-added

Production

Increase Value-added

Production

Develop a Digital

Economy

Develop a Digital

Economy

Improve the Transportation

Infrastructure

Improve the Transportation

InfrastructureConserve Water Resources

and the Ecology

Conserve Water Resources

and the EcologyConstruct New Hometown

Communities

Construct New Hometown

Communities

Develop as an

Operations Headquarters

Develop as an

Operations Headquarters

Double the Number of

Tourists Visiting Taiwan

Double the Number of

Tourists Visiting Taiwan

Develop an International

Base for R&D

Develop an International

Base for R&DDevelop the Cultural

Creativity Industry

Develop the Cultural

Creativity Industry

Challenge 2008The Six-year National

Development Plan

Cost: US$ 75 billion

Challenge 2008The Six-year National

Development Plan

Cost: US$ 75 billion

Source: Council for Economic Planning and Development

15

Challenge Goals

1. At least 15 World No. 1 products or technologies

2. At least doubling of visitor arrivals

3. R&D expenditures 3% of GDP

4. Reduction of unemployment rate to under 4%

5. Economic growth rate above 5%

6. More than 6 million broadband Internet users

7. Creation of 700,000 new jobs

Challenge 2008 Development Plan

16

兩兆雙星計畫

資料來源：經濟部工業局

產業範圍 目前產值 未來產值

2000 2001 （ 2006 ）

半導體 (設計 ,製造 ,封裝 ,測試 )

714.4 526.9 1,591.2

影像顯示 ＊ 平面顯示 ＊ LCD 顯示

186.086.0

100.0

290.0120.0170.0

1,370.0730.0640.0

數位內容 (software, electronic games, media, published music, animation, network services)

118.7 133.4 370.0

生物科技 95.6 102.8 250.0

☆ 新台幣兩兆元產業 : 半導體產業及影像顯示產業☆ 雙星產業 : 數位內容及生物科技

單位 : 新台幣十億

17

台灣投資機會

製造業

技術服務業

通訊光電

資訊數位電子消費電子

半導體精密機械與自動化

生化及製藥航太

特用化學高級材料

網路軟體或內容網路服務

高階積體電路設計自動化或電子化工程服務電力系統統包工程服務業

產品工程服務生物技術與製藥業技術服務業

提供屬製造業之溫室氣體排放量減量工程技術服務業 節約能源或利用新及淨潔能源工程技術服務業

環境保護工程技術服務業

18

租稅獎勵 (1)

投資於自動化設備或技術

Research and Development

Manpower Training

Balancing of Urban-Rural

Industrial Development

Overseas Chinese and Foreign Investment

30% tax credit for expenditures

30% tax credit for expenditures

30% tax credit for investment in resource-poor or backward areas

Source: Industrial Development Bureau, MOEA

5--20% tax credit for expenditures

Income tax collected at a uniform rate of 20%

19

Tax Incentives (2)

Five-year tax holiday

Emerging Important Strategic Industries

Establishment of Logistics and Distribution Centers

Establishment of Operations Headquarters

Revenues exempt from tax

Income exempt from tax

Source: Industrial Development Bureau, MOEA

20

Preferential Leasing Terms for Land

in Industrial Estates

For manufacturers that lease land in industrial estates, we provide

the first two years rent-free, rental at 60% of the normal rate for the

third and fourth years, and rental at 80% of the normal rate for the

fifth and sixth years. From the seventh year, the rental fee returns to

the normal rate.

Scope of application: Nine industrial estates.

Period of implementation: To Dec. 31, 2004

Industrial Land Rental Discounts Program

Source: Industrial Development Bureau, MOEA

21

投資考察邀訪

經濟部投資業務處邀請跨國公司來台投資、技術合作及採購

跨國公司管理階層可向經濟部駐外單位經濟組申請投資考察補助

一旦投資申請獲准 , 投資處將免費提供商務艙來回機票、國內交通費、五天四夜的食宿

22

經濟部投資業務處

地址 : 台北市中正區館前路 71 號8 樓電話 : 886-2-23892111傳真 : 886-2-23820497網址 : http://www.idic.gov.tw電郵 : [email protected]