Taiwan has again been ranked as the fifth-best investment environment in the world and third-best in Asia by Switzerland's Business Environment Risk Intelligence (BERI) in its most recent evaluation report.
The report came as the American Chamber of Commerce in Taiwan released its annual White Paper in which it detailed numerous obstacles to investment for foreign investors and warned that Taiwan must overcome serious restructuring challenges if it was to remain globally competitive.
The BERI report, officially known as the profit-opportunity recommendation, surveys conditions in 50 major countries and ranks them according to overall assessments in each location.
A summary of the report, released by the Ministry of Economic Affairs on Friday, predicted that Taiwan's global ranking would improve to fourth within five years and that it would consider classifying Taiwan as a developed nation in next year's report.
This advancement would be based in part on Taiwan's high performance in this year's labor force evaluation measure, in which Taiwan ranked fifth -- sharing the position with the US -- trailing only Singapore, Switzerland, Belgium and Japan.
According to BERI, Taiwan rates fourth in the world in work ethics and labor laws, sixth in relative productivity and 10th in labor capability.
In the AmCham report, labor force issues related to government regulation also featured prominently, being listed as one of the priority issues. However, AmCham focuses on the role that government restrictions on the hiring of personnel plays in building obstacles to foreign and local businesses.
Access to a high-quality labor force was picked by the majority of members in the business-confidence survey as being the most essential part of improving their ventures in Taiwan.
In the report, AmCham said that "virtually every AmCham industry and professional-service category has complaints about Taiwan's restrictions on the free flow of human capital."
Outdated and inappropriate work-permit requirements, impossibly high professional licensing requirements for foreigners and laws preventing women from working late at night -- even if it disrupts a globalized company's 24-hour operations -- were all cited by AmCham as serious concerns.
"The regulatory environment has often made bureaucrats the human resource managers for the private sector, which means that they end up assessing business risks for the private sector," said the report.
"AmCham urges the government to allow companies to make their own hiring decisions," says the report, which is compiled by foreign businesspeople in Taiwan -- many of whom have operated in Taiwan for decades.
In terms of its political risk index -- where first position means a country's political risk is least -- Taiwan was rated 15th in the world and third in Asia, beating local competitors like China at 20th position, South Korea at 22nd and Thailand at 30th.
But despite its comparatively high ranking from BERI, AmCham highlighted the lack of clear and consistent government policy as a major concern for foreign business.
Respondents to AmCham's business survey listed the need for clear economic policies as the number one concern when asked what would help their companies the most in regard to the government.
Traditional favorites like a stable political environment and stable cross-strait relations were relegated to second and third place, respectively.
The seemingly unending reshuffling of the Cabinet "has not helped build business confidence or establish clear economic policies," said the chamber.
Additionally, AmCham criticized the shift in focus for the Council for Economic Planning and Development (CEPD) toward planning as having degraded the CEPD's ability to coordinate government ministries and agencies and "blunted the government's ability to implement its economic policies."
BERI is the private source for comprehensive ratings, analyses, and forecasts for over 130 countries.
BERI has two permanent panels of experts that provide country ratings and qualitative observations on both political conditions and the operating environment.
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