Taiwan has become a leader in the global supply chain, as an increasing number of its overseas companies have been investing more funds at home, economists said on Saturday.
Taiwan Institute of Economic Research (TIER, 台灣經濟研究院) president Chang Chien-yi (張建一) said that the government’s incentive programs for Taiwanese investors, launched last year, have attracted many top-tier Taiwanese manufacturers to return.
In their wake, second and third-tier industries have also returned, helping the nation reshape its production structure, Chang said.
Photo: CNA
“The move by these Taiwanese investors to come home has helped Taiwan assume the position of commander, or the brain, of the global supply chain,” he said. “This development is expected to boost Taiwan’s status in global trade.”
The incentive programs were launched as companies were seeking to move some of their production out of China to avoid the US’ increased tariffs on Chinese-made products during a trade dispute.
As of Friday, 473 Taiwanese companies have pledged to invest a combined NT$989.1 billion (US$33.1 billion) in the home market under the incentive programs, while 56 more are waiting for approval, the Ministry of Economic Affairs said.
Even Taiwanese companies that operate businesses in China and Southeast Asian countries have been able to use Taiwan as a hub while mapping out global expansion strategies to meet the needs of various clients, Chang said.
Earlier last week, Minister Without Portfolio Kung Ming-hsin (龔明鑫) said that NT$200 billion of the nearly NT$1 trillion in pledged returning funds had been invested last year.
Companies this year are expected to invest an additional NT$325.3 billion, which amounts to 1.7 percent of the nation’s NT$19 trillion GDP and boosting the economy, Kung said.
Taiwan’s GDP grew 1.54 percent in the first quarter of the year, outperforming many nations as the global economy was being affected by the COVID-19 pandemic, the Directorate-General of Budget, Accounting and Statistics said.
Pledged investments are expected to reach about NT$500 billion this year, which would improve Taiwan’s status in the global supply chain, the ministry said.
Listed manufacturers’ combined sales last year fell 2.8 percent from a year earlier to NT$16.5 trillion amid the US-China trade dispute, the ministry said.
Their total net income fell 19.8 percent annually to NT$1.23 trillion, it said.
However, manufacturers’ spending on research and development (R&D) last year rose 7.9 percent to a five-year high of NT$460.8 billion, with the electronic components industry spending the most at NT$266.3 billion, followed by the computer and optoelectronics industry at NT$123.8 billion, according to ministry data.
The two industries accounted for 84.7 percent of total R&D spending in Taiwan’s manufacturing sector last year, the ministry said.
The Taiwan Automation Intelligence and Robot Show, which is to be held from Wednesday to Saturday at the Taipei Nangang Exhibition Center, would showcase the latest in artificial intelligence (AI)-driven robotics and automation technologies, the organizer said yesterday. The event would highlight applications in smart manufacturing, as well as information and communications technology, the Taiwan Automation Intelligence and Robotics Association said. More than 1,000 companies are to display innovations in semiconductors, electromechanics, industrial automation and intelligent manufacturing, it said in a news release. Visitors can explore automated guided vehicles, 3D machine vision systems and AI-powered applications at the show, along
AI SERVER DEMAND: ‘Overall industry demand continues to outpace supply and we are expanding capacity to meet it,’ the company’s chief executive officer said Hon Hai Precision Industry Co (鴻海精密) yesterday reported that net profit last quarter rose 27 percent from the same quarter last year on the back of demand for cloud services and high-performance computing products. Net profit surged to NT$44.36 billion (US$1.48 billion) from NT$35.04 billion a year earlier. On a quarterly basis, net profit grew 5 percent from NT$42.1 billion. Earnings per share expanded to NT$3.19 from NT$2.53 a year earlier and NT$3.03 in the first quarter. However, a sharp appreciation of the New Taiwan dollar since early May has weighed on the company’s performance, Hon Hai chief financial officer David Huang (黃德才)
FORECAST: The greater computing power needed for emerging AI applications has driven higher demand for advanced semiconductors worldwide, TSMC said The government-supported Industrial Technology Research Institute (ITRI) has raised its forecast for this year’s growth in the output value of Taiwan’s semiconductor industry to above 22 percent on strong global demand for artificial intelligence (AI) applications. In its latest IEK Current Quarterly Model report, the institute said the local semiconductor industry would have output of NT$6.5 trillion (US$216.6 billion) this year, up 22.2 percent from a year earlier, an upward revision from a 19.1 percent increase estimate made in May. The strong showing of the local semiconductor industry largely reflected the stronger-than-expected performance of the integrated circuit (IC) manufacturing segment,
COLLABORATION: Softbank would supply manufacturing gear to the factory, and a joint venture would make AI data center equipment, Young Liu said Hon Hai Precision Industry Co (鴻海精密) would operate a US factory owned by Softbank Group Corp, setting up what is in the running to be the first manufacturing site in the Japanese company’s US$500 billion Stargate venture with OpenAI and Oracle Corp. Softbank is acquiring Hon Hai’s electric-vehicle plant in Ohio, but the Taiwanese company would continue to run the complex after turning it into an artificial intelligence (AI) server production plant, Hon Hai chairman Young Liu (劉揚偉) said yesterday. Softbank would supply manufacturing gear to the factory, and a joint venture between the two companies would make AI data
RSS