Three incentive packages offered by the Ministry of Economic Affairs (MOEA), which were launched in 2019, have convinced local companies to invest more than NT$2.1 trillion (US$68.33 billion) in Taiwan, ministry statistics released on Saturday showed.
The three incentive packages, which offer preferential loans to encourage investments in Taiwan, have prompted more than 1,400 local companies to agree to pour funds into Taiwan since 2019, and are expected to create 149,000 jobs, the ministry said in a statement.
With Taiwan Semiconductor Manufacturing Co (台積電), the world’s largest contract chipmaker, keen to expand production and upgrade technologies in Taiwan, 22 of its suppliers such as IC packaging and testing service provider ASE Technology Holding Co (日月光半導體) and silicon wafer maker Wafer Works Corp (合晶科技), have promised to invest NT$66 billion in Taiwan under the three incentive packages, the ministry said.
Photo: Ritchie B. Tongo, EPA-EFE
Amid escalating trade tensions between the US and China, the ministry launched the first package of incentives on Jan. 1, 2019, which involved the Cabinet’s National Development Fund assigning NT$210 billion in preferential loans to persuade Taiwanese investors with operations in China to return to Taiwan.
The incentives are aimed at reducing Taiwan’s reliance on the Chinese market and at mitigating negative effects caused by trade tensions between Washington and Beijing.
Another incentive package was launched on July 1, 2019, by the National Development Fund to assign NT$100 billion in preferential loans to help local small and medium-sized enterprises invest in Taiwan.
The third package consists of a fund that has assigned NT$120 billion since July 1, 2019, to encourage enterprises not covered by the first and second packages to invest in innovative industries.
The three incentive packages, which have been extended for an additional three years, focus on the government’s “5 plus 2 industries” development projects, which are smart machinery, making Taiwan Asia’s Silicon Valley, green technologies, biotech, national defense, new agriculture and the circular economy.
The ministry said the more than NT$1.2 trillion in investment pledged by these enterprises has been leading to an upgrade in local industries, which helped the local economy fend off not only the impact from trade tensions between the US and China, but also the effects from interruptions in the global supply chain caused by the COVID-19 pandemic.
A large number of investment projects under the three packages involve artificial intelligence development and electric vehicle-related industries, which are expected to help Taiwan seize business opportunities in these emerging sectors on the global market, the ministry said.
The ministry said Taiwan has commanded the lead over many other countries in the information technology industry, so many Taiwanese companies have become part of the global supply chain of US electric vehicle brand Tesla Inc.
Twenty-nine Taiwanese key component firms have served as Tesla suppliers in a wide range of products, such as power systems, electric motors, batteries, vehicle frames and charging systems, a report by the Chinese-language CommonWealth Magazine said.
Among the companies echoing the government’s call to invest in Taiwan’s EV market were flat-panel supplier Innolux Corp (群創), contract electronics maker Pegatron Corp (和碩), thick film substrate producer Tong Hsing Electronic Industries Ltd (同欣電子) and forged wheel supplier SuperAlloy Industrial Co (巧新), which have been part of Tesla’s supply chain, the ministry said.
Some old-economy companies have also entered the EV market as they have set sights on new energy development by applying for the ministry’s incentive programs.
One of them is petrochemical conglomerate Formosa Plastics Group (台塑集團), which is investing in lithium-titanate battery development, and Kwang Yang Motor Co (光陽工業), a major manufacturer of motorbikes under the Kymco brand, which has started to roll out electric scooters.
The three packages are scheduled to expire at the end of this year.
Taiwan’s foreign exchange reserves fell below the US$600 billion mark at the end of last month, with the central bank reporting a total of US$596.89 billion — a decline of US$8.6 billion from February — ending a three-month streak of increases. The central bank attributed the drop to a combination of factors such as outflows by foreign institutional investors, currency fluctuations and its own market interventions. “The large-scale outflows disrupted the balance of supply and demand in the foreign exchange market, prompting the central bank to intervene repeatedly by selling US dollars to stabilize the local currency,” Department of Foreign
ENERGY ISSUES: The TSIA urged the government to increase natural gas and helium reserves to reduce the impact of the Middle East war on semiconductor supply stability Chip testing and packaging service provider ASE Technology Holding Co (日月光投控) yesterday said it planned to invest more than NT$100 billion (US$3.15 billion) in building a new advanced chip testing facility in Kaohsiung to keep up with customer demand driven by the artificial intelligence (AI) boom. That would be included in the company’s capital expenditure budget next year, ASE said. There is also room to raise this year’s capital spending budget from a record-high US$7 billion estimated three months ago, it added. ASE would have six factories under construction this year, another record-breaking number, ASE chief operating officer Tien Wu
The EU and US are nearing an agreement to coordinate on producing and securing critical minerals, part of a push to break reliance on Chinese supplies. The potential deal would create incentives, such as minimum prices, that could advantage non-Chinese suppliers, according to a draft of an “action plan” seen by Bloomberg. The EU and US would also cooperate on standards, investments and joint projects, as well as coordinate on any supply disruptions by countries like China. The two sides are additionally seeking other “like-minded partners” to join a multicountry accord to help create these new critical mineral supply chains, which feed into
For weeks now, the global tech industry has been waiting for a major artificial intelligence (AI) launch from DeepSeek (深度求索), seen as a benchmark for China’s progress in the fast-moving field. More than a year has passed since the start-up put Chinese AI on the map in early last year with a low-cost chatbot that performed at a similar level to US rivals. However, despite reports and rumors about its imminent release, DeepSeek’s next-generation “V4” model is nowhere in sight. Speculation is also swirling over the geopolitical implications of which computer chips were chosen to train and power the new
RSS