Taiwan’s investment in ASEAN markets in the first half of this year surpassed the volume bound for China, as local firms continued to shift manufacturing bases away from the world’s second-largest economy at clients’ urging to avoid US-China trade frictions, the Ministry of Economic Affairs said yesterday.
Approved investments in Southeast Asia reached US$2 billion in the first six months of this year, accounting for 18.1 percent and overtaking China as the No. 1 destination at 17.6 percent, the ministry said in a report.
It attributed the changes to a global supply chain realignment and rising Chinese labor costs.
Photo: Reuters
The phenomenon became evident in 2018 when China-bound investment shrank by 50 percent to the lowest level since 2010 and plunged another 50 percent in 2019, the ministry said.
From 2018 to last year, investment destined for China declined 40.3 percent from the period of 2013 to 2017.
At the same time, investment bound for ASEAN markets grew 40.9 percent, the report said.
The bulk of investment in ASEAN was in manufacturing facilities, at 38.2 percent, followed by financial and insurance service providers (23.5 percent), and wholesale and retail operations (22.3 percent), it said.
By contrast, China-bound investment was focused on manufacturing facilities, it added.
Major local banks have set up branches in Vietnam, Thailand, Cambodia and elsewhere in Southeast Asia to better serve their Taiwanese clients and take advantage of fast-growing economies in the region.
The government has also encouraged investment in ASEAN markets under President Tsai Ing-wen’s (蔡英文) New Southbound Policy to help local companies diversify investment risks.
For the past decade, tech companies have increased their investment in ASEAN markets, whereas previously it was non-tech firms focused on the region, the ministry said.
Today, electronic component suppliers make up for 27.6 percent, followed by vendors of computers and optical devices at 12.2 percent, textile makers at 8.9 percent and base metal product suppliers at 6.2 percent, it said.
In the previous four years, base metal product suppliers accounted for 46.2 percent of investment in the region, far outweighing electronics companies at 24.2 percent, it said.
India emerged as another big beneficiary of the global supply chain realignment, with outbound investment from Taiwan soaring more than threefold after the signing of a bilateral trade agreement in 2018, the ministry said.
Investment in India this year might challenge the five-year average of US$100 million, it said, as India’s vast population has received increased attention from global technology titans and their suppliers.
Elon Musk’s lieutenants have reached out to chip industry suppliers, including Applied Materials Inc, Tokyo Electron Ltd and Lam Research Corp, for his envisioned Terafab, early steps in an audacious and likely arduous attempt to break into the production of cutting-edge chips. Staff working for the joint venture between Tesla Inc and Space Exploration Technologies Corp (SpaceX) have sought price quotes and delivery times for an array of chipmaking gear, people familiar with the matter said. In past weeks, they’ve contacted makers of photomasks, substrates, etchers, depositors, cleaning devices, testers and other tools, according to the people, who asked not to
NO SHORTCUTS: Asked about Elon Musk’s Terafab initiative, TSMC CEO C.C. Wei said it takes two to three years to build a fab and another one to two to ramp it up Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday raised its revenue growth forecast for this year to above 30 percent, up from the 25 percent it estimated three months earlier, citing extremely robust artificial intelligence (AI)-related chip demand. “Our customers and customers’ customers, who are mainly cloud service providers, continue to send us very positive signals and outlook,” TSMC chairman and CEO C.C. Wei (魏哲家) said at an earnings conference. The company also hiked its capital expenditure for this year toward the higher end of its forecast, or US$56 billion, as it aims to step up advanced chip capacity expansions, such as
The founder of Chinese property giant Evergrande Group (恆大集團) has pleaded guilty to charges of fraud and bribery, a court said yesterday, the latest blow for what was once the country’s leading developer. Evergrande’s rise was propelled by decades of rapid urbanization and rising living standards, but in 2020, its access to credit dramatically narrowed when the government introduced curbs on excessive borrowing and speculation. The company defaulted in 2021 after struggling to repay creditors. Founder Xu Jiayin (許家印), 67, known as Hui Ka Yan in Cantonese, was reportedly held by police in 2023, with Evergrande saying he had been subjected to
Taiwan is attracting a growing number of foreign jobseekers as companies increasingly recruit overseas talent to ease labor shortages and expand global reach, recruitment platform 104 Job Bank (104人力銀行) said yesterday. More than 40,000 foreign nationals searched for jobs in Taiwan through the platform last year, a 28 percent increase from a year earlier, the company said. Malaysians accounted for the largest share of overseas jobseekers at 12.2 percent, followed by Indonesians at 11.9 percent and Vietnamese at 10.8 percent. Indonesian applicants surged more than 50 percent year-on-year, while Vietnamese jobseekers rose by more than 30 percent. Applicants from the
RSS