Thu, Jun 27, 2013 page3

• Pact is a national security threat: surveillance expert

  • By Chu Yu-ling, Lai hsiao-tung and Jason Pan / Staff reporters, with staff writer
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  The nation’s proprietors of surveillance systems expressed worries that the “housing interior decoration and exterior design” industry included in the recently signed cross-strait service trade agreement may have national security implications, as the industry is involved in the installation and maintenance of surveillance systems.

  Liu Lu-chun (劉祿群), who installs surveillance cameras in Chiayi City, said that his business is a special regulated industry, because many public infrastructure and building projects are required to install security camera systems.

  “Right now, the installation of Chinese-made surveillance systems for public-sector projects in Taiwan is forbidden,” Lu said. “However, after the signing of the pact, it is very doubtful that we would be able to resist pressure from China and continue banning the installation of Chinese-made products.”

  “For tender project procurement, if it goes with the lowest priced bid, Taiwanese firms would lose out to competition from China,” he added. “If we totally open up the sector, then Taiwan’s traffic control system and video surveillance in public places would use electronics products made in China. These would be installed by Chinese contractors. This is a serious threat to our national security.”

  Lu said that when Chinese corporations invest in Taiwan’s key industries, they would have tremendous pricing advantage over Taiwanese firms as they can integrate supply and production chains from upstream all the way downstream by linking the manufacturing, transportation, sales and marketing and installation service sectors.

  “Take a large construction project as an example. A medium-sized Taiwanese firm may need to bid at least NT$1 million (US$33,300) to make a profit, but a Chinese company may be able to secure the tender with a bid of only NT$350,000,” Liu said.

  He said that the major pricing difference between Taiwanese and Chinese products lie in the chipsets for video monitors, which are ordered from foreign manufacturers.

  “For Taiwanese firms, they might place an order for 1,000 chipsets, while Chinese firms can put in an order for 50,000, or even 100,000 chipsets. This leads to a substantial price difference,” he said.

  “So what’s left for Taiwanese firms? We may only have a competitive advantages in service, technology and quality,” he said. “However, if there is a big difference in price, do customers still care about product quality?”

  Under the cross-strait service trade agreement, the opening up of the housing interior decoration and exterior design industry also includes electricity and plumbing repair work, carpentry, roofing and house painting, among others businesses.

  Chen Wei-han (陳韋翰), a veteran interior decorator in New Taipei City (新北市), was incensed as he criticized the government “for letting Chinese companies come to Taiwan and steal our businesses.”

  “We will have more people out of work who are not earning any money. This government is killing the livelihoods of blue-collar workers,” he said.

  Tsai Wen-ying (蔡文英), a home decor materials proprietor for more than 35 years, said that most of the timber products used in interior decoration in Taiwan come from Indonesia.

  “The Indonesian products are of good quality, with slightly higher prices. The timber and wooden floor products from China are cheaper by at least 10 percent or more, but they are of bad quality, not very durable and they do not last for as long. Therefore the Chinese products are mostly used for outdoor exhibits and displays of model homes,” he said.

  Once Taiwan opens up to Chinese companies, prices would be driven down and bad quality products would proliferate.

  “It’s Taiwanese consumers who will suffer the consequences,” Tsai said.

  Interior decorator 66-year-old Tsai Ching-wen (蔡清文) said that most Taiwanese firms are small or medium-sized enterprises, while Chinese corporations are adept at investing a lot of money.

  “In this way, Chinese companies and workers will eventually compete for jobs in our trade. Taiwanese firms and laborers will not get any business. We will not be able to survive,” Tsai said.
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