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Let's save the Taiwan tiger before it's too late

As the presidential debates were being held in Taiwan, Singapore was giving its people a NT$40 billion (US$1.3 billion) bonus, the Hong Kong government was asking itself what to do with its NT$400 billion surplus and new South Korean President Lee Myung-bak was announcing five new economic goals in the hope of initiating a 60-year period of progress.

Looking at this debate from abroad and in light of the possibility that Taiwan could be removed from the list of Asia's "four tigers," one could be forgiven for feeling a sense of loss.

How can Taiwan's less-than-stellar economic performance be improved? It's a good thing that both presidential candidates have returned to the issue of economic policy and given voters room for rational thought. Perhaps because they were restricted by the scope of the public's questions, their responses during the first debate were rather partial and segmented, lacking in strategic perspective and global vision.

Faced with the enormous potential of the Chinese market and entwined in the complex cross-strait relationship, both candidates have adopted stances that differ from that of President Chen Shui-bian (陳水扁).

The most urgent task for the next president is to prioritize security and prosperity, provide opportunities for Taiwanese industry and pool available resources to quickly develop a foundation for industry and thus create a Taiwanese economic renaissance.

Taiwan's economic future should be a major strategic focus. Rather than debating how many days of chartered flights should be allowed per week, we should rather seek to determine which sectors of industry Taiwan should focus on.

Here is what we are confronted with: The economic health of the information and electronics industries is influenced by the US economy, which has soured of late; the health of the tourism industry is predicated on various circumstances; and the financial services sector is limited by a mess of regulations and policies. As for the cultural industry, it is not yet mature enough to be industrialized.

Chinese Nationalist Party (KMT) presidential candidate Ma Ying-jeou (馬英九) said the government should raise the average income, for which investment and spending will be needed. In response, the KMT has put forward the "633" economic policy and the "i-Taiwan 12 Projects."

Democratic Progressive Party presidential candidate Frank Hsieh (謝長廷), meanwhile, said that the government should reduce taxes, raise the value of labor and restrict government investment.

But the government complains it is impoverished, so how can it make investments? If the government has no money, then how can it cut taxes? The average income in Hong Kong is higher than in Taiwan and the highest income taxation rate is 16 percent. No matter how hard it tries, Taiwan's tax cuts will never reach the majority of taxpayers in an M-shaped society.

The Hong Kong government has adapted quickly to new economic realities by redirecting itself toward the financial and logistical industries. Domestic policy has created a convenient transportation system and a cosmopolitan lifestyle. Recently, Hong Kong has become one of the world's three major financial centers, on par with London and New York.

Taiwan has more advantages than Hong Kong: high quality of professional skills, quality of life and a rich cultural foundations. But our election culture is too concerned with mud-slinging and fear-mongering. Perhaps Sunday's presidential debate allows for new hope.

Ted Chiou is a professor in the Department of Public Administration and Policy at National Taipei University.

Translated by Angela Hong
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