US president-elect Donald Trump might pursue a protectionist trade policy after taking office, but a National Development Council (NDC) official remains optimistic on private-sector cooperation between Taiwan and the US.
The Republican Party supports a free-market economy and there should be ample room for Taiwanese and US enterprises to work together, council Deputy Director Kung Ming-hsin (龔明鑫) told reporters, when asked about the potential economic impact of a Trump presidency.
Kung said there have been recent and close engagements between Taiwanese and US companies, and the contacts have focused on Taiwan’s “five plus two” industries.
‘FIVE PLUS TWO’
The “five plus two” refer to seven key innovative industry development projects that President Tsai Ing-wen (蔡英文) proposed during her inauguration in May to transform the nation’s economic and industrial structure.
The US “has demonstrated great interest [in the projects] and offered Taiwan some [business] opportunities,” Kung said.
Thanks to that development, Kung said he was “cautiously optimistic” over Taiwan’s development after Trump’s election.
Asked about some academics’ suggestion that Taiwanese enterprises should consider setting up manufacturing in the US, the economist said: “It is the right direction.”
GLOBAL SUPPLY CHAIN
The structure of the global supply chain has generally involved Japan supplying high-end parts and components, and China or Southeast Asian countries manufacturing low-end parts and assembling finished products, Kung said.
However, “the supply pattern might not be like this in the future,” he said.
What consumers will want in the future are products “made in small quantities, but multifunctional” and can be “customized,” Kung said, adding that it would be possible for such products to be made in the US.
However, the US will not be able to produce all of the parts and components it needs, and this will give Taiwan’s supply chain an opportunity to work with US companies, Kung said.
The “five plus two” development projects, which stress globalization and links with international markets, offer Taiwanese and US enterprises the chance to tighten their bonds, but in a different way than in the past, Kung said.
COOPERATION
“[Such bonds] will not be simply about orders or contract manufacturing,” Kung said, but about cooperation on research and development or “total solutions.”
The “five plus two” projects are the establishment of an Asian Silicon Valley and development of “green” energy, national defense, biotechnology and pharmaceuticals, smart machinery and new agricultural sectors and a circular economy.
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