I read with interest Lin Cho-shui's (
Some of the development is due to property speculation and rising real estate value. Having said that, Ireland does have a number of advanced multinational corporations such as Cement Roadstone Holding and Smurfit Ireland. I would agree however that it does fulfill an original equipment manufacturer (OEM) role in the electronics industry. Even so, the key point is that Irish OEM firms would not work for gross margins below 20 percent to 30 percent, while most Taiwanese companies on the stock market would happily settle for 10 percent.
It seems that the sole aim of large Taiwanese companies is to earn more revenue, and I suspect the ulterior motive is for the directors and main shareholders of these companies to grow rich on cashing out a significant shareholding, with little thought given to other shareholders. This phenomenon is hardly positive for economic efficiency and wealth creation as a whole.
As an Irishman who has been living in Taiwan for the past nine years and running a business here and in Ireland, I have seen for myself that both countries have their unique values and advantages.
Ireland has a relatively bureaucracy-free corporate culture. Practically anyone can come to Ireland to set up a company. Contrast this with Taiwan, where it takes months of effort and large capital investment to set up a firm, along with severe restrictions on company activity. Financing is extremely difficult, and banks will not issue loans or credit cards to non-Taiwanese.
In Ireland, anyone residing in the country for five years can get an Irish (EU) passport, but in Taiwan a foreigner must give up one's original nationality and do one-and-a-half years' military conscription (if male). This is not reaching out to the world.
On the domestic economic front, the average Irish person sees wage increases of 3 percent to 10 percent yearly based on a contract between the Irish government and the most powerful unions. This helps to ensure wealth creation is spread down. Contrast this with Taiwan, where workers' salaries have not increased in all the time I have been here. I blame this squarely on a government system that allows rich companies and individuals to earn enormous profits and park these overseas.
The average Irish worker would not accept this system. In Taiwan, however, society is fed a dream based on the concept of "work hard enough and you will succeed." In this way the people on the lower rungs scrabble away for the scraps, desperately hoping that they can get on the wealth ladder. In the process they are conned into accepting low wages and worse working conditions.
I believe the reason why South Korea is surpassing Taiwan is precisely because the Koreans as a nation are confident in themselves, and because the workers collectively bargain with the government.
Ireland would never accept the system of brokered foreign labor employed in Taiwan, in which Taiwanese workers are denied a decent salary by government and big business colluding to import low-cost labor.
Taiwanese are certainly more entrepreneurial than the Irish and better businessmen, but in my experience they lack an internationally competitive and creative mindset. They are also by and large not confident about Taiwan's future, which I find strange and unbelievably self-defeating. The Irish, while not as hard-working, are extremely confident in their own land.
I strongly believe Ireland is much better connected to the world than Taiwan. Most Irish have lived, studied or worked overseas for at least a few months of their lives. How many Taiwanese have done this? Tourists from all over the world come to visit Ireland. In general, Taiwan is still not promoted as a site for tourism even though it has beautiful mountains, national parks and a friendly people. This reflects a lack of an internationalized mindset.
Ireland has many more industries than purely biotech and computer hardware and software, and this year Ireland will host the Ryder Cup, one of golf's most prestigious tournaments. Tourism is a massive contributor.
Also, it is disingenuous to compare China to Ireland. China is strong in OEM manufacturing due to a low-cost base and the cluster effect of manufacturing. A company such as mine could employ 10 people in China for one in Ireland. But the Irish operation may earn more because it concentrates on high-profit-margin sectors.
Taiwan's economic development policies have been unfairly biased toward large Taiwanese corporations. Every one of them seems to be running offshore accounts in tax-free entities such as the British Virgin Islands.
How much do Hon Hai and Quanta invest back into Taiwan? This is what Lin should be asking. Why do they keep their financial operations offshore?
If Taiwan is serious about economic development, it needs to make itself a tax-free haven for these companies, or outlaw this kind of offshore operation to stop the money flowing out of the country.
In Ireland the tax revenue service is extremely aggressive, and it is extremely hard to avoid being caught for non-payment of tax or tax evasion. In Taiwan you never see large corporations being prosecuted for tax transgressions.
It is undeniable that the total lack of respect for Taiwan from the international community, including the Irish government, seriously affects economic development here. However, I think the political system is the most important for a country's development. Specifically, Taiwan should emulate Ireland, Finland and the Netherlands: Each is run by a parliamentary system where the majority party in parliament runs the government, and constructive Cabinet policies are implemented by a non-partisan civil service.
Maybe Lin would be better served to study this area and come out with a solid proposal to create a solid political governing system than sniping at the latest ever-changing economic policy proposals.
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