The Ministry of Economic Affairs (MOEA) will send teams of experts to China to help upgrade Taiwanese investors’ businesses in an effort to boost their corporate competitiveness in the face of a harsher investment environment across the Taiwan Strait.<
Beginning on July 1 until the end of the year, at least 120 of Taiwan’s China-based manufacturers are expected to receive support from the experts.
They will evaluate their business operations and give them professional advise and suggestions on how to cope with the rising cost of doing business in China, Berton Chiu (邱柏青), director-general of the MOEA’s Department of Investment Services, said yesterday.
Chiu said China’s new labor contract law, as well as its ending of preferential tax treatment for Taiwanese investors, could potentially raise production costs and increase competition for Taiwanese investors in China.
The new labor contract law, which came into effect in January, increases labor costs by increasing pay, as well as the compensation a worker is entitled to when dismissed by a company, Chiu said.
“Since last year China has also reduced export tariff rebates, which narrow the revenue generated from exporting businesses,” he said, indicating that was another major factor shrinking the profit of Taiwan’s China-based manufacturers, many of which operate as exporters.
In addition, Chiu said China removed tax incentives for foreign investments last year and the corporate income tax rate for investors in coastal cities has risen from 15 percent to 25 percent.
He said that the ministry’s new program, executed by his department, will target Taiwanese manufacturers in traditional industries as they are suffering most because of the changes.
“Our program will allow them to streamline their manufacturing by focusing efforts on production automation, technical upgrades, and logistics improvements,” Chiu said.
“The teams of experts will arrange scores of seminars and workshops in both China and Taiwan to address the emerging issues and possible solutions to problems investing in China,” Chiu said.
He added that the ministry will also provide legal advice on its Web sites and publications to business owners to help them to solve investment disputes.
The experts will include industry specialists from the ministry and the Industrial Technology Research Institute, a local think tank.
As for the future developments of the program, Chiu said his department would respond to the queries and demands of Taiwanese investors who join it when developing additional services to help them.
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