Liberty Times (LT): Having lived in the US for 35 years, what are your thoughts on the US-China trade dispute?
Edwin Liu (劉文雄): I think that [US president Donald] Trump is very smart. He might seem crazy to others, but he is a businessman and his actions toward China could be the result of meticulous planning.
Now it is about who can keep it up longer. The common consensus is that the US will be able to hold out longer and China will eventually have to give in.
Photo: Hung Yu-fang, Taipei Times
This view is based on the comparatively healthy structure of the US economy. The Chinese industry is structured with lower unit pricing in mind, and the major industries are state-owned and not driven by the capitalist market.
Over the short term, the trade dispute should cause China — and the world — to suffer a downturn in economic performance, but it could provide China an opportunity to change its industry on a structural level.
This is not necessarily a bad thing for China, or the rest of the world.
The US has hiked tariffs on US$200 billion of Chinese imports by 25 percent, which China met with tariffs on US$60 billion of US imports. The ban on Huawei [Technology Co] is a move in a trade negotiation.
My guess is that the US is eyeing when to go easy on China. The tariff hikes on US goods in China will not prevent the Chinese from buying those goods. Those who can afford to buy US products could circumvent the tariffs by buying the goods in Japan and bringing them back to China.
The US knows that its products’ value lies in their branding.
On the other hand, Chinese goods are only considered because of their comparatively cheaper price, and could be replaced with products from other countries, such as Mexico, Southeast Asia or Vietnam.
LT: The trade dispute has caused many Taiwanese businesses to return to Taiwan. Could there be a shortage of power?
Liu: Having power reserves is like financial planning, which depends on the form expenditures take and the effectiveness of management. If you spend a lot and badly, you will run out.
Taiwan imports 99 percent of its energy supply. Maintaining a stable balance regarding the supply and demand of power is the responsibility of everybody, from those generating power and distributing it, to the end-users. The government, businesses and each citizen share a measure of responsibility.
The crunch period for Taiwan’s energy supply is the summer. With operating or safety reserves running low, a malfunctioning power plant — big or small — could spark a power crisis.
For cost effectiveness, Taiwan should not prioritize new power plants. Instead, the focus should be on reducing the power load during summer’s peak periods, which increases operating reserves.
This could be achieved by something as simple as turning off the appliances that use the most energy.
With its limited resources, Taiwan should come to a consensus on how to use energy in a smart way. Saving electricity saves money.
People should know and implement common-sense practices, such as keeping the doors and windows of air-conditioned rooms closed, turning off lights when leaving a room, and unplugging computers and devices that are not in use, which goes a long way toward saving energy.
Take California as an example: Its policy is for renewables to make up 33 percent of its energy supply by 2020. By the end of last year, renewables already made up 34 percent. Why is it ahead of schedule? Because the entire population was committed and the government had made subsidies and incentives available for things such as rooftop solar panels for households.
By 2025, California expects to shutter the last of its nuclear power plants.
By saving energy, and using distributed generation and renewables, the electricity supply gap can be closed.
The electricity problem can be solved so long as there is resolve. With a comprehensive social effort, we can and will reach the goal of increasing the share of renewable energy to 20 percent by 2025.
LT: Can you elaborate on how we could solve our power problems with “smart usage”?
Liu: I have noticed that everyone is more concerned with the policies to transition to greener energy sources than how to use the resultant power smartly.
Taiwan Power Co or the Bureau of Energy should not shoulder sole responsibility for the entire process from power generation to delivery and consumption. Everyone is responsible for the power grid, including industries and the people.
The [Industrial Technology Research Institute], on the other hand, is trying to arrive at a solution from the technical side.
The institute has established the Office for Power Grid Management and Modernization Strategies. The process of delivering and allocating power forms the power grid, which is often overlooked.
For the power grid to be reliable, we have to improve energy efficiency and modernization. Not only must we do this, but we must do it well.
In general, there is a talent gap in the Taiwanese power industry. The office seeks to alleviate the situation by establishing schools that would educate people about our power systems and foster new talent.
By promoting concepts for proper energy management, fostering talent in the field of computer engineering and stepping up Taiwan’s capability to solve technical problems, we hope to inject renewed vitality into Taiwan’s power industry.
LT: What assistance will the institute offer to Taiwanese businesses that are coming home or moving to Southeast Asia?
Liu: Taiwanese firms went to do business in China for the cheap labor and other factors that reduced costs. Recreating those conditions for the businesses returning to Taiwan is impossible and undesirable.
Instead, Taiwan should consider this situation an opportunity to upgrade the technology and business models used in industry.
Last year, the institute established a platform that provides Taiwanese businesses with services connected to industrial transition and technology upgrades. As we have discovered, many businesses want these services.
The institute is also preparing the ground for Taiwanese businesses taking part in the New Southbound Policy by investigating the local supply-demand situation. For example, we are cooperating with indigenous research and development organizations, including state-owned and private entities.
We are working in the fields of smart manufacturing, the Internet of Things and the circular economy with Malaysia, Indonesia, Thailand and Vietnam, to name a few countries. So even as our enterprises move to Southeast Asia, the institute will continue to provide them with the services they need.
Translated by staff writers Jake Chung and Jonathan Chin
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