Kuraki Co Ltd, a Japan-based machinery manufacturer, built its first overseas production base in Taiwan as part of an expansion plan to capitalize on strong demand in China, the Ministry of Economic Affairs (MOEA) said.
The company, a highly respected builder of computer numerical control (CNC) horizontal boring mills and CNC horizontal machining centers, constructed the factory at a cost of NT$264 million (US$8.7 million), the ministry said on Wednesday.
After operations begin at the factory in Greater Taichung next month, Kuraki’s global market share is expected to rise to 8 percent, the ministry said.
One of the key factors that spurred the new investment was the implementation of the cross-strait Economic Cooperation Framework Agreement (ECFA), the ministry said.
Machine tools were among the items on the trade pact’s “early harvest” list.
Kuraki is not the only Japanese machinery firm that is taking advantage of the ECFA.
FANUC Corp, Japan’s largest machine-tool firm, invested NT$2 billion in Taiwan soon after the ECFA was signed in June last year.
The ministry said a rising yen and the devastating earthquake and tsunami that hit Japan in March were also factors that spurred Japanese companies to seek overseas production bases to minimize risks.
The value of machine-tool exports from Taiwan is expected to reach US$4 billion this year, which would make Taiwan the third-largest machine-tool export market in the world, behind Japan and Germany, the ministry said.