It was reported recently that the Chung-Shan Institute of Science and Technology, the military research arm of the Ministry of Defense, was forced to halt production of advanced cruise missiles because of a lack of key parts not produced domestically.
For two decades, the government has championed technology transfer. From the early 1980s to the late 1990s, Taiwan was a global manufacturing center of many consumer electronics products including personal computers, liquid-crystal-display panels and CD players.
Why is it then, that Taiwan still depends on foreign sources for critical missile parts?
At fault perhaps is a problem known to very few laymen -- false technology transfer.
Take, for example, semiconductor memory production. In the 1980s, companies acquired a complete line of production from abroad and transplanted it to Taiwan.
A typical production line involved using crystal growth chambers, wafer slicing and cutting tools, diffusion furnaces, photolithographic setups, wire-bonding machines, encapsulation equipment and computerized logic testers.
None of those key components were made in Taiwan. What Taiwan provided was simply factories, labor and production management.
Is the situation any better after more than a quarter century in terms of local designs? The answer is no.
The nation's electronics industry still depends on foreign sources for vital ingredients in the production process, including focal plane image sensors, auto-focus motor drives, batteries and power management. Digital camera production is an example of this.
It goes without saying that Taiwanese industries excel in tweaking and improving manufacturing techniques, production efficiency and product yields.
But the nation's companies are lagging in terms of creative design innovation. Behind this problem lies the disadvantages of what is, at times, self-defeating technology transfer.
First of all, the notion that technology can be transferred must be critically challenged and debated.
What actions comprise a "technology transfer?" Procuring and transplanting a production line does not constitute the transfer of technology.
A company that owns such a line can at best be called the operator of a production line -- usually knowing nothing about the inner workings of even a single section of the manufacturing process.
So is it possible to transfer technology? The answer is yes if technology means nothing more than manufacturing. But if technology refers to the design process as well, then the answer is no.
A satellite designed and built from scratch requires thousands of parts and a truck load of engineering blueprints. The complexity of a satellite involves translating the design into a realization in hardware form.
But what a set of electronic blueprints depicts is no more than the final product -- an attempt to juggle design needs with costs and deadlines. It is not documentation of a designer's thought process and does not explain why the designer chose specific solutions or what other options were considered.
That missing information is what spoils the chances of technology transfer.
When it comes to building up a technology base, there are no shortcuts. Technology can be learned only through hard work and sweat.
Taiwan must abandon its belief in quick fixes and tackle its deficiencies in innovation. Otherwise it will often find itself in a situation similar to its difficulties in producing missiles.
Kengchi Goah is a research fellow at the Taiwan Public Policy Council in the US.
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