Describing Taiwan’s economy as “too dependent” on the technology sector, Pegatron Corp (和碩) chairman Tung Tzu-hsien (童子賢) yesterday called for the nation to transition to a more diversified economy to keep thriving in the post-COVID-19 world.
“The Taiwanese economy is lopsided,” Tung said at an industry forum in Taipei. “We always rely on the tech sector. It is like a forest with only one kind of tree. There is not enough diversity.”
Tung said the overreliance on industrial exports is “a hidden problem,” and urged the government to assist the service sector in becoming more globalized and competitive.
Using Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) as an example, Tung said that past government support played a pivotal role in the success today of Taiwanese tech companies.
While TSMC is undoubtedly “the pride of Taiwan,” Tung said the highly capital-intensive and technologically advanced chipmaking business could not have thrived in Taiwan without government support.
“We are feasting off the fruits of policy decisions made 40 years ago. What are we going to be eating 40 years from now?” he asked.
While the service sector comprises 60 percent of the Taiwanese economy and industry only 30 percent, the domestic service sector is not internationally competitive, he said.
“A country does not need to have a lot of land and a large population to thrive economically, what is more important is finding a place in the global economy to put talent and intelligence to good use,” he said.
Many China-based Taiwanese firms are moving back home amid an escalating US-China trade dispute, but Tung said it would do no good to move Pegatron’s factories back to Taiwan because of the nation’s limited labor force.
“If somebody wanted Pegatron to move our factories back to Taiwan from Shanghai and Suzhou, I would have to say sorry... We need to find 200,000 workers. That’s not possible in Taiwan,” he said.
Instead, Tung suggested “a division of labor” where jobs that require more creativity and generate more value stay in Taiwan while other jobs are exported.
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