The three main reasons Taiwanese businesspeople invest in China are cheap and abundant labor, cheap land and preferential tax rates -- not to mention that Chinese and Taiwanese people share the same language. As a result, about 750,000 people, more than 70,000 companies and as much as US$280 billion has already flowed from Taiwan to China. The outflow has led to a decrease in Taiwan's tax revenues, a rise in unemployment, a downturn in the economy and social disruption. So I have a dream: Wouldn't it wonderful if Taiwanese businesspeople began to flow back to Taiwan?
Is this possible? I have talked to many Taiwanese businesspeople investing in China, including enterprises already firmly established there, and the answer is positive. They are willing to relocate their entire operations -- or at least part of their production lines -- if they can maintain their international competitiveness.
One businessman said, "I always feel inexplicable pressure in China, and cannot sleep well unless I am in Hong Kong. I can only relax in Taiwan."
Why is this the case? It is because businesspeople in China may become victims of accusations at any time. You may be a successful businessperson today, but a prisoner tomorrow. Too many businesspeople have gone to jail for ridiculous reasons. Shocks such as these and the uncertainty about the future are the main reasons they are willing to move back.
To encourage Taiwanese businesspeople to come back, the government must improve the investment environment, so these businesses will be able to maintain their competitiveness.
The government must review its local and foreign labor policies. This will take a long time, however, and it will be difficult to do since it may affect vested interests.
It would be better for Taiwan to first establish a "special export zone." Businesspeople should be allowed to rent the land in the zone, not buy it.
In the zone, there should be no restriction on the minimum wage of foreign workers, and firms should be allowed to import foreign labor freely, without being subject to oppression from vested interests. In this way, wages for foreign workers can be capped at NT$5,000 (US$155).
The government will not have to provide other preferential treatment, and businesspeople will flow back -- because under these preferential conditions, China's attraction to Taiwan's export industry will no longer exist.
Will this method threaten domestic industry? Of course not. The businesses that return will be ones that are no longer operating in Taiwan, so there will be no unfair competition if they move back. Will this negatively affect the employment of locals? The answer is the opposite. The government can stipulate that the percentage of local laborers of all the companies inside the zone must exceed 20 percent, in order to create new job opportunities for local workers, not take their chances away.
Will low wages violate foreign workers' human rights? Of course not. Whatever wages can attract them to work in Taiwan are reasonable wages. Otherwise, why would they want to leave their homes to work for us? It is really unnecessary for the government to set a minimum wage for foreign workers.
The establishment of a special zone would attract Taiwanese businesspeople to return to Taiwan and save the economy. As for our academics, politicians, government bureaucrats and vested interests, they should give Taiwan a break.
Do not block the solution with excuses such as human rights. We should first think of those who are being made redundant in middle age and the impact this has on their families. Many people have even been driven to suicide by economic pressures. Shouldn't their right to life be protected first?
William Kao is the chairman of the Victims of Investment in China Association.
Translated by Eddy Chang
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