Mon, Oct 02, 2017 - Page 6 News List

Time for sporting goods to rebound

By Charles Yu 余宗龍

Premier William Lai (賴清德) is just beginning to address the challenges before him. One is how to provide economic results as the global economy recovers.

The government has proposed the “five plus two” industrial innovation plan and the Forward-looking Infrastructure Development Program.

However, the initiatives’ high cost, which has caused controversy, and the low added value that they will bring to the nation’s manufacturing industry suggest that a more comprehensive plan taking into account the broader economy is needed.

The most pragmatic approach would be to focus on the integration of existing outstanding industries to build momentum for economic growth and increase employment opportunities.

Taiwan’s economy has been stagnant for years. While its top industries have faced tough challenges, there has been a chronic lack of competitive new industries, which has led to insufficient momentum toward economic growth. Consequently, people have little hope of escaping low wages.

The sporting goods industry has always been important to the nation, as it helped pave the way for the “Taiwan miracle.” Between the 1970s and 1990s, Taiwan was a major supplier of sporting goods to the global market, but as wages increased, many labor-intensive industries decided to move abroad.

As the government’s industrial policy has turned toward electronics, information technology and other high-tech industries, the sporting goods industry has accounted for an increasingly small percentage of the nation’s total manufacturing output.

Increasing public health awareness has created new potential in the rapidly expanding global sporting goods markets. Many activities that have become popular around the world — like going to the gym, jogging and biking — play to the strengths of Taiwan’s traditional manufacturing industry.

Perhaps this is the time to take advantage of these trends and once again boost the nation’s sporting goods industry, as it could increase economic growth, the number of available jobs and feelings of happiness among the public, as well as keeping talent in Taiwan.

If the government were to integrate resources in an organized way and provide timely assistance to the sporting goods industry by applying Taiwan’s globally recognized technological and innovative skills to it and consolidating its competitive advantage, the industry would be able replicate its past successes.

The Ministry of Economic Affairs should establish an office to take charge of optimizing the sporting goods industry.

The goal of the office should be to encourage innovation and to guide sporting goods businesses in optimizing and transforming their industry through the development of more differentiated products. Specifically, it should help businesses move toward making high value-added products, as opposed to the uniform sports equipment and sportswear of the past.

To better differentiate products, businesses will need to create innovative, high value-added products, create demand for their services and develop effective business models, while the government needs to provide the required business and regulatory environment.

For example, the government should facilitate cooperation across industries. The sporting goods industry can work with other industries to develop innovative and high value-added products, such as integrating medical equipment or electronic equipment in sportswear. Doing so would also stimulate industry in general through new technological breakthroughs.

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