The Cabinet on Tuesday last week proposed a draft “new economy immigration act” and is to send it to the legislature for deliberation during the next legislative session. The purpose of the proposed legislation is to attract talented professionals from overseas, especially mid-level technical personnel, to make up for a labor shortage.
The new policy is also a response to the problems associated with the nation’s aging population. Taiwan’s population is forecast to start declining in 2027, when its demographic dividend will cease to exist, which would affect the development of industry and commerce.
The proposed law aims to attract four kinds of immigrants: skilled professionals, mid-level technical personnel, investors and overseas Taiwanese and their children.
The bill can be seen as broadening the scope of the Act for the Recruitment and Employment of Foreign Professionals (外國專業人才延攬及僱用法), which was enacted at the end of last year.
While that act concerned “foreign professionals,” for whom it eased policies regarding certification, residency, health insurance, tax and pensions, the new bill goes a step further by including technical personnel and allowing for the retention and continued employment of migrant workers who have reached a medium-qualified level in the industrial and social care sectors.
This is especially true of talented professionals working in the “five plus two” innovative industries and the artificial intelligence field, for whom the proposed law would provide special incentives to stay in Taiwan. It is hoped that these measures will complement existing legislation related to the recruitment of professionals and boost the incentives that Taiwan offers to attract professionals from abroad.
The draft act includes some welcome breakthroughs.
The first aspect concerns foreign professionals. The bill would boost recruitment of talented professionals needed for national development. With regard to specialized and technical occupational categories, the government said the ministries would set recruitment practices based on “negative lists.”
This means that unnecessary restrictions will be removed and better inducements offered in all sectors except for certain industries where employment of foreigners is prohibited or restricted.
Second, to encourage technically capable foreign and overseas Taiwanese students, as well as mid-level migrant workers in industry and social services, to stay and work in Taiwan, employers would be allowed to employ such people as long as they pay them more than the minimum wage. Ordinary professionals are able to obtain permanent residency after staying in Taiwan for five years in a row; this would be reduced to three years for specialists in designated fields.
This marks a breakthrough from the limited number of years that migrant workers have hitherto been allowed to work in Taiwan under the Employment Service Act (就業服務法).
However, the draft act does set a minimum salary threshold for such workers, because the government must consider how to avoid having a negative effect on Taiwanese workers’ employment opportunities and salary levels, as well as seeking to resolve the technical personnel shortage that businesses have long been complaining about.
When companies in the “five plus two” innovative industries — which are prioritized for development — hire foreign professionals, they would no longer have to meet the previous requirement regarding their total capital. This applies to fields such as semiconductors, the Internet of Things, cloud and blockchain technologies, big data and new agriculture.
In such cases, foreign professionals who have graduated from university would need to have at least two years’ work experience and be paid a monthly salary of at least NT$47,971 (US$1,599) to meet the draft act’s conditions for immigration and employment.
This shows that the government has set its sights on the efficient development of key industries, and intends to break with the requirement that employers who apply to hire foreign professionals must have a designated minimum capital and annual revenue.
However, the significance of the draft act is not limited to the conditions required for work permits and residency. It also involves the issues of permanent residency and naturalization. The rules contained in the bill would also apply to people from Hong Kong and Macau, so it would have deep and far-reaching effects on Taiwanese society.
Take, for example, the conditions that the bill sets for investor immigrants. It stipulates that people who invest at least NT$15 million in a profit-oriented enterprise or at least NT$30 million in government bonds, and who creates work opportunities for five Taiwanese, would be able to get permanent residency after staying in Taiwan for three years.
This rule is expected to attract people from Hong Kong and Macau.
However, if large numbers of immigrants are absorbed into Taiwan, it might give rise to social problems such as cultural clashes and competition for jobs.
How that works out will depend on Taiwanese society being tolerant and inclusive — perhaps more than it already is.
The government must also take precautions regarding potential economic effects in areas such as real-estate investment and financial speculation.
Through adequate planning and suitable measures, hopefully the government can prevent its well-intentioned immigration policies from losing their focus and going off course.
Liu Meng-chun is director of the First Research Division at the Chung-Hua Institution for Economic Research.
Translated by Julian Clegg
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