The government will assist strategic industries battered by the global economic downturn to seek vertical integration with foreign corporations and horizontal mergers with their local counterparts to help them ride out the crisis, Premier Liu Chao-shiuan (劉兆玄) said yesterday.
Liu declined to specify which industries he was referring to, but said that the government would follow the model it has come up with to rescue manufacturers of dynamic random access memory (DRAM) chips to help the flat panel industry.
On Dec. 16, the Ministry of Economic Affairs outlined its principles for supporting the DRAM industry, saying it not only aimed to bail out individual DRAM makers, but also wished to see local players develop multiple integration links, within Taiwan and internationally.
In an interview with Bloomberg last Friday, Elpida, Japan’s largest computer-memory chipmaker, confirmed that it is talking with Powerchip (力晶半導體), Rexchip Electronics Co (瑞晶電子) and ProMos Technologies Inc (茂德科技) about a combination plan.
“I am not getting into specific industries [that need consolidation] ... We have related governmental agencies talking to industries ... We are in the middle of pushing for vertical integration [of strategic industries] and overseas corporations,” Liu said.
How the government intends to help struggling strategic industries recover from economic meltdown would be clarified after the Lunar New Year break that ends on Feb. 1, he said.
“For industries that are interested in consolidation, the government will always stick to two principles in facilitating negotiation — to acquire crucial technologies that the company previously lacked and to organize the best management teams,” Liu said.
At the press conference, Liu reviewed what his Cabinet had done in the past seven months and restated his policy direction for the next few years.
Liu said that the Council for Economic Planning and Development would soon reveal a proposal for a trade park to encourage China-based Taiwanese businesspeople to return to Taiwan.
Lin said the location of the park and a set of cost-reducing incentives would be included.
The government is expected to encourage the private sector to invest up to NT$4 trillion (US$121 billion) in the next four years, including in a software park in Kaohsiung by Foxconn Technology Group (鴻海集團), a Kuokuang Petrochemical Technology (國光石化) naptha cracker complex project in Changhua County, the fifth-stage expansion proposal of the sixth naphtha cracker plant in Yunlin County by Formosa Plastic Group (台塑集團) and the third Naphtha Cracker Renovation and Expansion Project at the Linyuan petrochemical complex in Kaohsiung County by CPC Corporation, Taiwan (中國石油).
When asked whether the high energy-consumption and high pollution projects were against the Cabinet’s policy to save energy and reduce carbon dioxide, Liu dismissed the question.
Liu said that the government will ask industries to make pledges of higher energy efficiency and set caps on carbon dioxide emissions.
Other than the petrochemical industry, the government also aimed to make energy, communications and biotech industries the country’s next “trillion dollar” industries, Liu said.