October 2020 | Vol

October 2020 | Vol. 50 | Issue 10

Restructuring supply chains

Amid COVID-19, a haven for talent

CONTENTS

NEWS AND VIEWS 6 President’s View AmCham Taipei Takes Action in Support of a BTA OCTOBER 2020 VOLUME 50, NUMBER 10 By Leo Seewald 一○九年十月號 7 Editorial Moving Toward a BTA with the U.S. Publisher 發行人往台美雙邊貿易協定邁進 Leo Seewald 李豪 Editor-in-Chief 總編輯 8 Taiwan Briefs Don Shapiro 沙蕩 Deputy Editor 副總編輯 By Jeremy Olivier Jeremy Olivier 歐嘉仁 Art Director/ 美術主任/ Production Coordinator 後製統籌 COVER SECTION Katia Chen 陳國梅 Manager, Publications Sales & Marketing 廣告行銷經理 Transforming the Energy Mix 改變能源結構 Caroline Lee 李佳紋 Translation 翻譯 By Timothy Ferry Kevin Chen, Andrew Wang 陳又銘, 王先棠 20 Renewables Industry American Chamber of Commerce in Taipei Faces Environmentalist 129 MinSheng East Road, Section 3, 7F, Suite 706, Taipei 10596, Taiwan Challenges P.O. Box 17-277, Taipei, 10419 Taiwan Tel: 2718-8226 Fax: 2718-8182 Environmental activists aim e-mail: [email protected] website: http://www.amcham.com.tw to ensure that Taiwan’s green 名稱：台北市美國商會工商雜誌 energy revolution is truly 發行所：台北市美國商會 environmentally sustainable. 臺北市10596民生東路三段129號七樓706室電話：2718-8226 傳真：2718-8182 14 Offshore Wind Projects But will their efforts slow down Taiwan Business Topics is a publication of the American Taiwan’s energy transition? Chamber of Commerce in Taipei, ROC. Contents are Face a Series of Challenges independent of and do not necessarily reflect the views of the Officers, Board of Governors, Supervisors or members. 22 Natural Gas to the Rescue © Copyright 2020 by the American Chamber of Commerce The COVID-19 pandemic has in Taipei, ROC. All rights reserved. Permission to reprint original material must be requested in writing from slowed down the development With renewable energy AmCham. Production done in-house, Printing by Farn Mei Printing Co., Ltd. of offshore wind resources projects likely to be delayed, 登記字號：台誌第一零九六九號 in 2020 due to disruptions Taiwan will be relying even 印刷所：帆美印刷股份有限公司經銷商：台灣英文雜誌社 in supply chains. Over the more heavily than expected on 台北市108台北市萬華區長沙街二段66號發行日期：中華民國一○九年十月 long-term, however, the natural gas. 中華郵政北台字第5000號執照登記為雜誌交寄 ISSN 1818-1961 government’s rigorous localization policy may present Chairperson: C.W. Chin Vice Chairpersons: Fupei Wang, Timothy Shields an even bigger impediment. Secretary: Seraphim Ma Treasurer: Angela Yu 19 Cultivating Talent for the 2019-2020 Governors: Offshore Wind Era Albert Chang, Seraphim Ma, Paulus Mok, Manohar Thyagaraj. A new, globally certified 2020-2021 Governors: C.W. Chin, Brian Sung, training center in Taichung Timothy Shields, Fupei Wang, Roger Yee, Angela Yu. is helping Taiwan develop 2020 Supervisors: Mark Horng, Stephen Tan, Terry Tsao. specialized personnel for its

COMMITTEES: offshore wind industry. Agro-Chemical/ Melody Wang; Asset Management/ Eric Lin, Angela Yang, Derek Yung; Banking/ Paulus Mok; Capital Markets/ Mandy Huang, Eric Jai, C.P. Liu; Chemical Manufacturers/ Charles Liang, Michael Wong; Cosmetics/ Abigail Lin; Defense/ Manohar TAIWAN BUSINESS BACKGROUNDER Thyagaraj, Roger Yee; Digital Economy/ Max Chen, Renee Chou, Tai Chi Chuan; Energy/ Richard Freer, 26 Taiwan’s Tesla Boom, and 29 With U.S. Cooperation, a Randy Tsai; Human Resources/ Christine Chen, David Tsai; Infrastructure & Engineering/ Wayne Chin, Paul Looking for More Shift in Supply Chains Lee; Insurance/ Emily Chen, KT Lim, Linda Tsou; Intellectual Property & Licensing/ Jason Chen, Peter Formosa Plastics founder Wang Taiwan and the U.S. are seek- Dernbach, Vincent Shih; Marketing & Distribution/ (tba); Medical Devices/ Louis Ko, Jeffrey Wang; Yung-ching failed at building a ing to build alternatives to pro- Pharmaceutical/ Justin Chin, Rie Nakajima, Shuhei Sekiguchi; Private Equity/ Echo Yeh; Public Health/ car business, but his failure laid duction of critical equipment in Joyce Lee, Pongo Peng, Tim Shields; Retail/ Ceasar the groundwork for the country’s China in the wake of the global Chen, Peggy Liao; Sustainable Development Goals/ Kenny Jeng, Cosmas Lu, Fupei Wang; Tax/ Heidi Liu, successful Tesla supply chain. pandemic. Cheli Liaw; Technology/ Cynthia Chyn, Stella Lai, Angela Yu; Telecommunications & Media/ Thomas Ee, What are Taiwan’s advantages in By Louise Watt David Shin; Transportation & Logistics/ (tba); Travel & Tourism/ Gina Tsai, Jason Yeh, Fiona Yuan. the electric vehicle age? By Kuo-chen Lu, CommonWealth

COVER DESIGN: GRACE YANG

4 TAIWAN BUSINESS TOPICS • OCTOBER 2020

10 contents.indd 4 2020/10/6 下午5:04 OCTOBER • VOLUME 50 NUMBER 10

INDUSTRY F CUS A Report on Human Resources Attracting the Talent 34 Popular Gold Card Program Still Needs Streamlining The special visa program for high-level foreign professionals has become all the more appealing in light of Taiwan’s deft handling of the COVID-19 pandemic, yet bureaucratic obstacles could deter potential applicants. By James Chater 37 For the Startup Scene, Unexpected Help from Silicon Valley The severe spread of COVID-19 across the U.S. this spring brought the return to Taiwan of high-level Tai- wanese-American talent from Silicon Valley. They are now helping build a similar environment for innovation in their ancestral home. By Jeremy Olivier 40 Taiwan’s Students Face Overseas Study Dilemma Every year, tens of thousands of Taiwanese leave to pursue degree programs in the U.S. and elsewhere, but the pandemic is forcing them to make a tough choice this year: go ahead with their original plan, take courses online, or defer their studies altogether. By Jeremy Olivier

EXECUTIVE SUITE 46 Meet Matthias Bausenwein of Ørsted By Jeremy Olivier

AMCHAM EVENT 43 The Chamber’s 69th Anniversary

SPONSORED CONTENT Inside Cover Taoyuan Helps Send PPE to Friendly Cities Abroad 24 Taipower Combines Stable Power Supply with Environmental Friendliness 44 JTI Key to securing a robust investment environment in Taiwan amid the pandemic: Serious attention to stakeholders 48 Seeing Taiwan The Lily and the Butterfly: Mountain Motifs in Taiwan’s South

TAIWAN BUSINESS TOPICS • OCTOBER 2020 5

10 contents.indd 5 2020/10/6 下午5:09 PRESIDENT'S VIEW

AmCham Taipei Takes Action in Support of a BTA

Taiwan appears to be making progress in Third, we have been meeting with AIT as pursuing a bilateral trade agreement (BTA) well as Taiwan government ofﬁcials to under- with the U.S. September’s visit of Under Sec- stand their respective positions on the process retary of State Keith Krach, while brief, was of achieving a BTA, as well as the poten- a strong indication of the U.S. government’s tial timelines. We want to make sure, to the desire to move ahead on strengthening eco- extent possible, that we are all on the same nomic relations with Taiwan. Still, a lot of page in how we approach the BTA issue. work needs to be done to move the process Finally, AmCham plans to hold a vir- toward a BTA forward, especially since it is tual CEO Mission to the U.S. Although not entirely clear what the process will be. COVID-19 this year made it impossible to For our part, AmCham is focusing our send a delegation to Washington as we typ- efforts on a few key areas with an emphasis ically do each June, we still feel the need to on identifying the relevant stakeholders in share our views with key stakeholders in the the BTA process and then letting them know U.S. Led by our Government Relations Com- that the Chamber views this initiative as a mittee, the Chamber will be reaching out top priority. virtually to many of the important contacts First, as you may have heard, AmCham we would usually visit in person. Key among has entered into an understanding with the these is the Office of the U.S. Trade Repre- U.S.-Taiwan Business Council to jointly estab- sentative (USTR), which is responsible for lish a U.S.-Taiwan Bilateral Trade Agreement driving the American trade policy agenda. Business Coalition. This Coalition is intended With an American presidential election fast to solidify support for a U.S.-Taiwan BTA and approaching, it is even more important to act as a crucial engine for advocacy to pro- share our members’ views with Congress and mote BTA negotiations with Taiwan. We are others interested in bolstering the bilateral currently recruiting members – predominantly relationship. The aim is to garner bipartisan American organizations, companies, and support to ensure that the U.S. continues to influential individuals – to join the coalition support Taiwan’s stability and economic pros- and support this advocacy initiative. perity as America’s 9th largest trading partner. Second, AmCham has signed a joint state- We hope that these efforts will help expe- ment with the Chinese National Association dite progress toward BTA negotiations and for Industry and Commerce in Taiwan. This continue to drive the growth in trade between body represents many of Taiwan’s most the U.S. and Taiwan. prominent businesses. Given that Taiwan and the U.S. are among each other’s major trading partners, there is strong interest on the part of the CNAIC to work with us to push for a BTA. As expressed in our joint statement, “After 69 years of AmCham’s operation in Taiwan, there is no question that the stability and prosperity of Taiwan is vital to our Leo Seewald members.” We are convinced that a BTA will President, further that stability and prosperity. American Chamber of Commerce in Taipei

6 TAIWAN BUSINESS TOPICS • OCTOBER 2020

10 presidents view.indd 6 2020/10/6 上午12:48 E D I T O R I A L Moving Toward a BTA with the U.S.

ecent progress in tightening the U.S.-Taiwan relation- been bipartisan – as has the desire to ensure trade stability and ship has been stunning. Developments have included high- security – the American position is likely to be similar whether the R profile visits to Taipei by the U.S. Secretary of Health next administration is Democratic or Republican. Senators from and Human Services, as well as the Under Secretary of State for both political parties were among the 50 signatories to a letter to Economic Growth, Energy and the Environment. Additional major the U.S. Trade Representative urging action toward a BTA with military sales are reportedly in the offing, following Taiwan’s Taiwan. August purchase of 66 new American-made F-16 fighters. Some American commentators have expressed concern that And perhaps most significantly, Washington is including pursuing such an agreement would jeopardize chances to engage Taiwan in its efforts to create what it is calling the Economic Pros- in further trade talks with China, which is undeniably the much perity Network, an alliance of countries committed to fair and larger market. But the argument can also be made that trade nego- mutually beneficial trade practices. Taiwan’s world-class semi- tiations with Taiwan would strengthen the U.S. hand in dealing conductor and other high-tech industries will be a valued part of with Beijing. the drive to restructure international supply chains to ensure their Taiwan is a relatively open economy with appropriate stan- security. dards in the often-sensitive areas of labor and environmental Most recently, the U.S. Treasury Department and Taiwan’s affairs. It is also heavily dependent on international trade for its Ministry of Finance announced unprecedented plans to cooperate economic well-being. As a result, it is likely to be a willing partner to provide funding for infrastructure investment in developing for a comprehensive, high-level BTA that could serve as the new countries. “gold standard” for trade agreements, with strong provisions on The next logical step is for Taiwan and the U.S. to begin nego- such topics as intellectual property rights and dispute-settlement tiations on a bilateral trade agreement (BTA). mechanisms. Such an agreement could be held up to Beijing as the The two countries are among each other’s most impor- model the U.S. intends to follow in future. tant trading partners, and each would have much to gain by A bigger obstacle may be the internal politicization of the further reducing tariff and non-tariff barriers. The Tsai Ing-wen issue within Taiwan, especially the opening of the market for administration has already demonstrated Taiwan’s goodwill by U.S. pork with acceptable levels of the food additive ractopa- announcing that major restrictions on imports of American beef mine. Given the importance for Taiwan’s prosperity and security and pork – long the number-one bilateral trade issue – will be of strengthening its relations with the U.S. – and considering the lifted from 2021. established scientific evidence that meat with trace elements of Practically speaking, little tangible progress toward a BTA is ractopamine is safe for human consumption – AmCham Taipei likely to occur until after the next U.S. presidential term begins in hopes that no political barriers to conclusion of a BTA will January. But since support for Taiwan in U.S. political circles has obstruct the current progress.

往台美雙邊貿易協定邁進

期台、美之間互動更加緊密，關係進展的幅度令人驚來由民主黨還是共和黨主政，美國政府的立場，應該都不會有喜，這包括美國衛生及公共服務部部長，以及美國國太大變動。包含共和、民主兩黨黨籍的五十位聯邦參議員，也近務院主管經濟成長、能源和環境次卿等高官訪問台曾聯名致函美國貿易代表署，呼籲儘快與台灣就雙邊貿易協定北。據報導，台灣八月購買66架美製F-16 戰機之後，還有其展開討論。他大型對美軍購案在進行。部份美國評論者指出，積極謀求台美雙邊貿易協定，恐怕不或許，最重要的，是華府要將台灣納入多個國家組成、共利於美國推進和中國後續的貿易談判，而中國無疑是規模更大同致力於公平互惠貿易實務的「經濟繁榮網路」（Economic 的市場。但是，從另一角度觀之，與台灣進行貿易協商，其實 Prosperity Network）之中。對於各國所推動國際供應鍊重也有助於美方和北京談判時不受掣肘。組、確保供應鍊安全的行動，台灣世界級的半導體等高科技產在勞動、環境事務等常起紛爭的領域，台灣制度規範大致業，必定是極受重視的成員。合宜，是個相對開放的經濟體。在經濟發展上，台灣也極其仰最近美國財政部與台灣財政部也宣布了史無前例的合作計賴國際貿易。因此，台灣應該樂於參與涵蓋面向較廣、位階較畫，要一同為開發中國家基礎建設投資提供經費。高的雙邊貿易協定，台美雙邊協定也能成為其他雙邊協定的新依照合理推論，下一步，應該是台、美之間啟動協商，促成「黃金標準」，在智慧財產權、爭議調解機制等談判主題上，雙邊貿易協定。納入形諸明文的堅定立場。這樣的雙邊協定，亦可作為樣板，台灣、美國彼此互為重要的貿易夥伴，如果能進一步減少關向北京傳達美國一心尋求的理想雙邊貿易模式。稅及非關稅貿易壁壘，對雙方都有許多好處。之前蔡英文政府台灣內部對此議題的政治化爭議，可能是台美雙邊貿宣佈要在2021年解除針對美國牛豬肉品的重要進口限制，已展易協定往前推進的更大阻礙。開放食品添加物萊克多巴胺現出善意。長期以來，此進口限制都是最受矚目的台美貿易議（ractopamine）殘留量未超標的美國豬肉進入台灣市場，影題。響最鉅。考量到強化台美關係對台灣繁榮安定的重要意義，再實際上，明年元月新一屆美國總統任期開始之前，台美雙邊加上已有受到認可的科學證據顯示，食用萊克多巴胺含量稀少貿易協定應該都不會有什麼實質進展。不過，既然美國政壇兩的肉品並無安全顧慮，台北市美國商會深切期盼台美雙邊貿易大黨都支持台灣，也都樂見台美貿易維持穩定、安全，無論未協定相關談判，能排除政治阻礙，向前邁進。

TAIWAN BUSINESS TOPICS • OCTOBER 2020 7

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— BY JEREMY OLIVIER —

MACROECONOMICS

TRADE KEEPS RISING, AS DO SPIRITS Spirits were high at the SEMICON Taiwan 2020 international conference, held both online and offline at the Nangang Exhibition Center in late September. One of the recurring themes was the post-COVID-19 economic rally that Taiwan is experiencing, in contrast to most markets in the West. The government’s effective early handling of the pandemic has allowed business and life to operate nearly as normal throughout the year. In addition, strong demand – both domestic and international – for semi- All suitably masked, U.S. Under Secretary of State Keith Krach (left) met with conductors and other high-quality tech President Tsai Ing-wen and Taiwanese industry icon Morris Chang. PHOTO: OFFICE OF THE PRESIDENT products has kept much of Taiwan’s ICT industry busy and in the black Imports also increased by a staggering according to the Taiwan Institute of since Q2. The Market Intelligence and 23.9% from August 2019, brought on Economic Research. Many companies also Consulting Institute (MIC) predicts that in part by expansion projects at several seem to be anticipating that recent trends demand from the new stay-at-home semiconductor firms. Taiwan’s trade will continue, with 27.7% expressing the economy will drive the production surplus for August, US$33.18 billion, expectation that business will improve value of Taiwan’s integrated circuit represented an increase of 11.89% from over the next half year, up 7.6 percentage packaging and testing industry up 9% the same month last year. points from the previous month. this year from a year earlier. Not surprisingly, Taiwan’s manufac- Trade value has also remained high. turers are expressing increased optimism, INTERNATIONAL Exports in August increased by 8.32% with 35.3% of firms perceiving business year-on-year, due to strong market to be better in August, a rise of 6 percent- U.S. OFFICIAL KRACH demand for ICT parts and components. age points from the previous month, MAKES BRIEF VISIT U.S. Undersecretary of State for ECONOMIC INDICATORS Economic Growth, Energy, and the Envi- ronment Keith J. Krach made a brief US$ billion Year earlier visit to Taiwan from September 17 to 19. Current Account Balance (Q2 2020) 21.8 17.6 While Krach is the highest-ranking State Foreign Trade Balance (Aug.) 6.5 6 Department official to visit Taiwan since New Export Orders (Aug.) 45.5 40.5 the U.S. cut official ties with the island Foreign Exchange Reserves (end Aug.) 498.2 476.2 in 1979, his trip was decidedly more

low-key than the much-publicized visit Unemployment (July) 4.00% 3.82% of Health and Human Services Secre- Discount Rate (Aug.) 1.125% 1.375% tary Alex Azar in August. The official Economic Growth Rate Q2 2020p -0.58% 2.60% purpose of Krach’s visit was to attend Annual Change in Industrial Output (July)p 2.65% 4.05% a memorial service for the late former Annual Change in Industrial Output (Jan.-July)p 6.03% Taiwan president Lee Teng-hui. Annual Change in Consumer Price Index (July) -0.52% 0.38% While in Taiwan, Krach held a Annual Change in Consumer Price Index (Jan.-July) -0.27% closed-door meeting with Vice Premier P=PRELIMINARY SOURCES: MOEA, DGBAS, CBC, BOFT Shen Jong-chin and Minister of

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Economic Affairs Wang Mei-hua and sovereignty. China, too, criticized the agricultural products through upcoming attended a dinner hosted by President move as “desperate” and promoting trade fairs in Taiwan. Tsai Ing-wen at the presidential resi- “separatism.” dence. Also in attendance at the dinner DOMESTIC was Morris Chang, the founder of TAIWAN, PARAGUAY Taiwan Semiconductor Manufacturing SIGN LETTER OF INTENT KMT MOVES TOWARD Co. (TSMC). Taiwan and Paraguay signed a letter PORK REFERENDUM of intent on September 25 to promote The opposition Chinese Nationalist SOMALILAND OFFICE technical cooperation between the two Party (KMT) began collecting signatures OPENS IN TAIPEI countries. The LOI signing took place for its petition against President Tsai’s Somaliland on September 9 opened at the 20th Republic of China-Para- decision to lift the ban on imports of U.S. its representative office in Taiwan, the guay Economic Cooperation Conference, pork products in September, questioning newest development in strengthening co-chaired by Taiwan’s Minister of the safety of residue from the feed addi- unofficial ties between the two coun- Economic Affairs Wang Mei-hua and tive ractopamine in such products. The tries. At an inauguration ceremony held Paraguayan Minister of Industry and petition is a first step toward holding a in Taipei, Somaliland’s representative to Commerce Liz Cramer. In a statement, national referendum on the topic. Taiwan, Mohamed Omar Hagi Moham- the Ministry noted that the LOI is aimed Speaking at the KMT’s annual oud, stated that the relationship formed at fostering mutual assistance and coop- National Congress, Chairman Johnny between Taiwan and Somaliland this eration in the areas of standardization, Chiang expressed his party’s firm opposi- year is “based on common values of metrology, and conformity assessment. tion to the central government’s decision freedom and democracy.” Paraguay is Taiwan’s last remain- to set a maximum residue level (MRL) Somaliland is a de facto sovereign ing official ally on the South American for ractopamine in pork products. territory in the Horn of Africa that continent, and despite market disrup- The UN-affiliated Codex Alimentarius declared independence from Somalia tion caused by the COVID-19 pandemic, Commission, which sets international during a civil war in 1991. Somalia still Wang said that trade between the two food safety standards, lists an MRL of lays claim to Somaliland as part of its sides has continued to flourish. Para- 10 parts per billion, the same level as territory, and has denounced the estab- guay is the second largest source of beef Taiwan has already accepted for beef. lishment of the representative office as imports to Taiwan, and Wang prom- However, a growing number of major a “reckless attempt” to undermine its ised to continue to promote Paraguay’s U.S. pork producers, including Smith-

KMT lawmakers take to the floor of the Legislative Yuan to protest President Tsai’s plan to open the market to U.S. pork containing trace amounts of ractopamine. PHOTO: MARTTI CHEN

TAIWAN BUSINESS TOPICS • OCTOBER 2020 9

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field, Hormel, JBS, and Tyson Foods, Team Power Healthcare, and Haw Ping relationship, China’s foreign ministry have ceased purchasing hogs that have Company, were part of the Taiwan spokesman Wang Wenbin on September been fed or exposed to ractopamine in government’s national campaign to 21 made a statement denying the exis- order to continue selling their products source and produce more face masks to tence of the median line, arguing that to China where the drug is banned. help battle the COVID-19 pandemic. The Taiwan is an inalienable part of China. The KMT’s petition must gather total heroic effort involved increasing daily Both the Taiwan and U.S. govern- signatures equal to 1.5% of the number production of medical-grade face masks ments have criticized China’s recent of voters in the most recent election in from 1.88 million to around 20 million. maneuvers in Taiwan’s airspace as a order to qualify for a referendum vote. danger to cross-Strait peace and stability. CROSS-STRAIT A Pentagon official said that the Septem- FIRMS BUSTED FOR ber 18 incursion is another example of MASK FRAUD CHINA RAMPS UP how China is using its military as a tool Several Taiwanese firms and indi- DRILLS IN STRAIT of coercion against Taiwan. President viduals have been caught trying to pass Undersecretary of State Keith Krach’s Tsai, in a speech given at an air force base off non-medical-grade face masks from visit to Taiwan was marked by increased in the offshore islands of Penghu, pledged China as Taiwan-made products. The saber-rattling and military intimidation to defend Taiwan’s airspace, and Minis- scam was thwarted by a large crack- by China. The People’s Liberation Army ter of Foreign Affairs Joseph Wu said in a down initiated by the authorities in late Air Force flew 18 military aircraft over press release that Wang’s statement would August. An investigation disclosed that the median line of the Taiwan Strait on undermine the cross-Strait status quo. four companies had been importing September 18, then 19 more aircraft the masks from China and repackaging them following day. The drills were part of BIRD GROUP EXPELLED as Made-in-Taiwan masks. what China’s defense ministry spokes- IN ROW OVER POLITICS The investigation also found that man described as a “legitimate and Taiwan’s largest bird conserva- over 1.2 million fraudulent masks had necessary action taken in response to the tion organization was expelled from been distributed and sold in pharma- current situation across the Taiwan Strait the UK-based BirdLife International in cies and other stores around the island to safeguard national sovereignty and September for refusing to sign a docu- for an estimated NT$4.4 million. One territorial integrity.” ment pledging not to advocate for the company that possessed only a sales In response, Taiwan’s air force scram- legitimacy of the Republic of China or license had imported 5.5 million Chinese bled fighter jets and deployed its air promote Taiwanese independence. The masks since June and colluded with a defense missile system, actions that are Taiwan Wild Bird Federation (TWBF), separate firm that had a manufacturing becoming ever more frequent as China formerly known as the Chinese Wild license to relabel them as having been increasingly puts pressure on the island Bird Federation, said its reason for not produced in Taiwan. by repeatedly breaching its air defense signing the document was that it was Some of the companies involved identification zone. Adding further unnecessary and inappropriate for an in the fraud, including Carry Mask, strain to the already fraught cross-Strait apolitical organization. In a statement released shortly after its expulsion from BirdLife, the TWBF TAIWAN'S JAN. - AUG. 2020 TRADE FIGURES (YEAR-ON-YEAR COMPARISON) cited letters dating back to December 2019 to demonstrate that it had main- China/ apan ASEA TOTA tained an apolitical stance in negotiating

93.9 with the international organization. 83.8 40.8 35.6 37.4 33.8 29.6 27.9 217.4 23.6 214.1 22.3 BirdLife reportedly had also taken issue 15.3 15.2 184.4 184.2 with the group’s Chinese name, which 2020 2019 2020 2019 2020 2019 contains Taiwan’s official designation, .S.A Europe the Republic of China, and consistently 32 30.1 urged the TWBF to change it. While 22.9 22.8

22.6 21.2 20 18 the TWBF moved to replace the word 2020 2019 2020 2019 2020 2019 “Chinese” in its English name with “Taiwan” after its status in BirdLife T: S Billion Exports mports SO RCE: BOFT/MOEA was revoked, the group’s Chinese name remains unchanged.

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KMT PULLS OUT OF STRAITS FORUM The KMT announced on Septem- ber 14 that it would not be attending this year’s Straits Forum, an annual conference normally held in Xiamen in China’s southern Fujian Province. The party had earlier in the month signaled its inten- tion to join the forum, which is ostensibly non-political in nature and intended to promote economic and trade exchanges and cultural integration. Former legislative speaker Wang Jin-pyng had been tapped to lead the delegation. However, after the headline on a China Central Television Program said The Xiafu Activity Center in Yilan whose design won a prestigious architectural award for IMO Creations. PHOTO: IMO CREATIONS the purpose behind the KMT’s attendance at the forum was to “sue for Pacific market. Such demand is expected ient of a 2019 A+ Award, presented by peace” in the Taiwan Strait, the KMT to continue to grow due to an increas- American media company Architizer, for announced that it would not participate ing awareness of the importance of UV its design of the Xiafu Activity Center in the event as a political party, though it protection among Asia’s consumers, said in Yilan County. Sometimes referred to would still allow individual members to Ralph Schweens, president of BASF Asia as the “Oscars of Architecture,” the A+ attend in a private capacity. Pacific’s Care Chemicals division. Awards is the biggest architecture and Since becoming Taiwan’s main oppo- Srikanth Vaduvur, vice president of design award program in the world and sition party in 2016, the KMT has tried Personal Care Solutions, Asia, emphasized receives over 5,000 submissions each to frame itself as the only party capa- BASF’s deep expertise in the production year. IMO’s design was a jury winner, ble of maintaining peaceful, prosperous of UV filter products and the company’s picked for its unique concept involving cross-Strait relations. To that end, it has complete solutions that include sunscreen multi-colored columns surrounding a rect- continued to send individuals and dele- formulations, which enhance every- angular interior and topped by a curved gations to China for meetings and events, day skincare routines. “Our site in Kao- roof. It is based on the aesthetics of despite a growing public sentiment that hsiung which maintains high competency Taiwan’s traditional temples. becoming closer with the PRC is not in in manufacturing standards currently After each year’s winners are Taiwan’s best interests. produces Tinosorb® S and the Uvinul® A announced, Architizer works with Plus investment will further augment the Phaidon Editorial to produce a compen- BUSINESS production of our UV filters portfolio in dium of all of the A+ designs from the the region,” said Vaduvur. previous year, titled “The World’s Best BASF MAKES NEW According to BASF, Uvinul® A Plus is Architecture.” The 2019 edition of the TAIWAN INVESTMENT one of the few photostable UVA filters book features IMO’s Xiafu Activity German multinational chemical available in the market today that reliably Center on the cover, the first time since producer BASF will begin doubling its filters the sun’s dangerous UVA rays and the award was launched in 2013 that a production capacity of Uvinul® A Plus, provides outstanding protection from free Taiwanese building appeared in that spot. an ingredient used for UVA protection in radicals and skin damage. The company Lain Satrustegui, partner architect at various sun and skin care formulations, notes that the ingredient, which is an IMO Creations, highlighted the impor- with the introduction of a new produc- oil-soluble granule, offers excellent formu- tance of the award and the decision to tion line at its Kaohsiung factory. BASF lation flexibility, is free of preservatives, place his team’s design on the book cover. currently produces the ingredient at its and is highly efficient at low concentration. “While the project has already received site in Ludwigshafen, Germany. recognition from numerous other national The company is increasing produc- IMO CREATIONS and international awards, my team and tion of Uvinul® A Plus in order to meet WINS A+ AWARD I feel that being featured on the cover of rising consumer demand for high-perfor- IMO Creations, an architecture firm such a prestigious publication is truly a mance and safe UV filters in the Asia based in Taipei, was recently the recip- once-in-a-lifetime honor,” he said.

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OFFSHORE WIND PROJECTS FACE A SERIES OF CHALLENGES

The COVID-19 pandemic has slowed down the development of offshore wind resources in 2020 due to disruptions in supply chains. Over the long-term, however, the government’s rigorous localization policy may present an even bigger impediment.

BY TIMOTHY FERRY

iding high on the inauguration operations around the world, including of its first major offshore wind offshore wind. farm – the 128-megawatt (MW) Taiwan immediately locked its RFormosa 1, Phase 2 project in Novem- borders and implemented strict quaran- ber 2019 – Taiwan expected 2020 to be tine and contact-tracing measures that a pivotal year for its nascent offshore earned it global recognition for effec- wind sector. Several major offshore tively minimizing the spread of the wind developments were scheduled to virus. For the offshore wind industry, be constructed and even commissioned though, these same efforts resulted in this year, including the 109MW Tai- costly delays and hardships for the work- power Phase 1 Demonstration Project, ers installing the windfarms. As Taiwan the 376MW Formosa 2, and the massive has little capacity or experience in the 640MW Yunlin wind farm. offshore wind business, it relies almost Instead, when COVID-19 spread entirely on foreign suppliers and crews. throughout the world, becoming the Factories around the world shut down deadliest pandemic in a century, it on stay-at-home orders, preventing work disrupted supply chains and industrial from proceeding on essential components

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such as the massive foundations needed the work in 2020, as originally sched- multiple consecutive projects. Delays for turbines and the pin piles used to fix uled, “will be very unlikely.” in one project will therefore likely have them to the ocean floor. Even for compo- The Taipower project is not alone. knock-on effects for later projects. nents that were ready for shipment, quar- Wpd Taiwan Energy, a subsidiary of Not everyone agrees that the antine rules slowed down their transport. German energy firm wpd GmbH, like- pandemic-wrought delays will be signifi- For the specialized offshore wind wise blames the pandemic for delays to cant over the long term, however. workers that Taiwan relies on, primar- its 640MW Yunlin offshore wind farm. “At this time, everything is going ily from Europe and with some from “Because of the virus…and the lock- according to plan,” assures Bureau of Indonesia, the stringent anti-COVID-19 downs, we are delayed. It has impacted Energy Deputy Director Lee Chun-li. measures drastically curtailed their move- our construction schedule,” Wang Yuni, He says that although the industry has ment, both internationally and between chair of wpd Taiwan, said at a September seen some slowdowns in the current stints on the vessel. Many crew members 2 press conference. pre-construction stage, the construction were forced to remain on the vessel for as According to British offshore wind phase is typically the fastest portion of long as six months without shore leave. consultancy 4C Offshore Wind, “Almost the offshore wind development process. Luxembourg-based marine construc- half of ongoing projects face costly “Until now maybe some projects are a tion company Jan De Nul, which is delays with developers pushing back little slow, but when projects like Tai- the EPCI (Engineering, Procurement, commissioning schedules by a year.” power Changhua Phase 1 and wpd go Construction, and Installation) contrac- Local offshore wind consultants who into the construction stage, we have tor for the Taipower project, said by requested anonymity due to the sensitiv- confidence that we can hit our target.” email that “the consequences of the ity of their positions say that with few The pandemic aside, delays in the COVID-19 pandemic have hit the project contractors able to operate in this sector, construction and installation of massive very hard,” resulting in “significant addi- many of the same marine construction infrastructure projects are a common tional costs” and “substantial delays.” and engineering firms – mostly from occurrence. Global analytics firm McKin- The company said that completion of Europe – are committed to working on sey & Co. observed in a 2015 report that

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“98 percent of megaprojects suffer cost be equally important. overruns of more than 30 percent; 77 Developers are finding it very hard percent are at least 40 percent late.” to meet the scheduling targets set by the “Delays in any construction site government, “mostly due to the localiza- and in offshore wind are quite normal, tion requirement,” says Tom Manning, and everybody applauds when a proj- deputy general manager of CWind ect is delivered on time, which means it’s Taiwan, a subsidiary of UK firm CWind. unique” says Edgare Kirkwijk, manag- “You just can’t develop a wind farm on ing director of Asia Green Capital and a the scale that they envision without first board member of the Asia Wind Energy developing the skill set.” Association. “The delays I’ve seen are To jumpstart its offshore wind sector, understandable.” Taiwan is offering a generous Feed-in- Industry insiders note that offshore Tariff, including a rate of NT$5.0946 wind took nearly three decades to reach Taiwan’s total power generation, will per kilowatt-hour (kWh) for electric- maturity in Europe, and even in the U.S. be completely shut down by the end of ity generated from the first 3.8GW most offshore wind projects face signifi- 2025, making the anticipated 21,000 of installed capacity. Revenues could cant delays. Taiwan’s rollout of the local gigawatt-hours (GWh) a year of offshore add up to billions of NT dollars over offshore wind industry has received wide wind power vital to meeting Taiwan’s the course of 20-year Power Purchas- attention for its ambitious scope and overall power needs. ing Agreements. Like every other coun- timeline. But given the delays already occur- try that has entered the offshore wind “The political framework and the ring, it remains unclear just how much of sector, Taiwan is demanding a substan- timeline for the tenders was always very the remaining 5.57GW of installed wind tial localization of the industry to ensure ambitious, and much faster and more capacity power will be available by the that some of this money is channeled effective than in Europe,” said wpd COO target date. Further, while GDP growth into the local economy. Achim Berge Olsen at a press conference has fallen since the pandemic, the return Developers are required to submit on September 3. of industrial investment to Taiwan along their localization plans for approval by These early delays are occurring with Taiwan Semiconductor Manufactur- the Industrial Development Bureau (IDB) within the context of Taiwan’s over- ing Company’s new high-end IC packag- under the Ministry of Economic Affairs, all energy transition in which offshore ing and testing plant being built in Miaoli which has specified a list of components wind plays a crucial role. Taiwan is County may increase power demand. that must be sourced in Taiwan, along aiming for 5.7 gigawatts (GW) of with the names of potential local suppli- installed offshore wind generating capac- The localization challenge ers. Among the items on the list are ity – over 600 turbines – by 2025. That turbine components, foundations, and would entail a total investment of US$20 The pandemic-related delays are not marine engineering vessels. billion and enable offshore wind to the only factor potentially affecting the The development of a local supply contribute as much as 8% of Taiwan’s wind projects’ timeline. What the indus- chain is intended to support not only power supply. Nuclear power facilities, try regards as Taiwan’s rigid and ineffi- Taiwan’s offshore wind sector but that of currently responsible for some 12% of cient localization policy may turn out to the entire burgeoning Asia-Pacific region.

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The Global Wind Energy Council fore- ated some successes. Examples include ing them “Made in Taiwan,” instead of casts huge growth in regional offshore the Siemens Gamesa cluster in Taichung investing in the capacity to manufacture wind development over the next decade, to assemble nacelles (the turbine hous- them locally including 7.9GW in installed capac- ing coverings) and the Ming Rong Yuan Because of the difficulties, many ity for South Korea, 7.4GW for Japan, Business Company’s project to manufac- domestic companies have been reluctant and 5.2GW for Vietnam. Taiwan is well ture pin piles. to enter the offshore wind industry, with ahead of all these markets in the offshore But Taiwan’s lack of experience in the result that the localization effort has wind development curve and presumes offshore wind or marine industries such been spearheaded by big state-affiliated that its first-mover status will enable it to as offshore oil and gas puts the local- enterprises such as China Steel and ship- establish itself as a regional hub. ization of the supply chain at a disad- builder CSBC. At the inauguration ceremony at the vantage, particularly as developers face “The government is trying to push Formosa 1 Offshore Wind Farm, Presi- accelerated schedules to get their proj- localization, but people are not getting dent Tsai Ing-wen outlined the govern- ects commissioned in time to meet future very enthusiastic,” says Asia Green Capi- ment’s localization strategy. “Taiwan’s power demand needs. Taiwanese manu- tal’s Kirkwijk. “I see a lot more initiatives green energy firms will be able to develop facturers have struggled to meet both taking place, but it’s driven by the devel- in the domestic market, and then use the scale and quality requirements for opers who are obliged to do this.” the expertise they have developed to offshore wind, disrupting development Local companies’ hesitancy is partly pursue business opportunities around the plans. There have even been scandals explained by the relatively small scale of world,” she said. in which steelmakers were accused of the market at present. Even the Phase 3 The localization policy has gener- buying components abroad and label- auctions coming up for an additional 10

Nacelles for the Yunlin Offshore Wind Farm await installation in the Taichung Port. PHOTO: TIMOTHY FERRY

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GW of offshore wind between 2026 and ing Taiwanese suppliers to the interna- Further, several of the future offshore 2035 will only add around 100 turbines tional market.” Instead, the Danish- wind markets that Taiwanese firms annually. GE Grid Solutions, noted in an invested company says, the program would presumably target, such as South interview with Wind Taiwan Magazine would “create a protective bubble for the Korea and Japan, are already supply- that localization requirements will slow local suppliers and enclose Taiwan as a ing many of the components needed by the entire development and construc- small closed market” that would provide Taiwan’s offshore wind sector. tion process, delaying returns on invest- few opportunities for Taiwanese suppli- CWind’s Manning suggests that the ment and making Taiwan a less attrac- ers to compete internationally and “is not localization policy be made more holis- tive market. GE noted that an investment aligned with the government’s aspiration tic, incorporating not only manufactur- in Taiwan’s offshore wind capacity might of making Taiwan a key offshore wind ing and construction but also operations require 1.3 to 1.5 times the amount of market in the Asia Pacific Region.” and maintenance. “Even the biggest wind money compared to a similar investment Jan De Nul noted in email correspon- farms never take more than a couple of in a leading offshore wind market. dence that “mandatory local supply also years for construction,” he says, but once Taiwan’s plan has been to offset suppresses much needed competition, a built, they have to be operated and main- this lack of local market scale by devel- key factor in driving down costs,” and tained for 20 or 25 years. Although less oping Taiwan into a regional offshore that the notion of turning Taiwan into a capital investment is involved, these func- wind hub. However, according to a regional hub for offshore wind “is para- tions “require all of the same skills and written statement by Ørsted Taiwan, doxical.” the same asset investment,” he says. “But a major player in Taiwan’s offshore “Where will the Taiwanese supply none of that creeps into the localization wind sector, “the current rigid item- chain export to if other markets in the checklist here.” based local content policy will not real- region are enforcing localization require- For its part, Ørsted recommends that ize the ultimate policy objective of bring- ments too?,” asks the company. the local content policy for the third- round auctions “incorporate more flexi- bilities and introduce market elements to enhance the capabilities and competitive- ness of the local supply chain.” Regardless of the government’s policy direction, Asia Wind Energy’s Kirkwijk predicts that a local offshore wind industry will emerge. “Developers cannot rely for the next five years on only foreign equipment, foreign expertise, foreign vessels,” he says. “Where in the world would you have only foreigners doing an industry for decades to come? It will not happen.”

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CULTIVATING TALENT FOR THE OFFSHORE WIND ERA

A new, globally certified training center in Taichung is helping Taiwan develop specialized personnel for its offshore wind industry.

aiwan’s shortage of qualified talent including 14,000 needed in Taiwan. Power Company (Taipower), China Steel to work in the offshore wind busi- CWind, an offshore wind manpower Corp. (CSC), CSBC Corp., Taiwan (the ness is among its chief challenges and vessels provider from the UK, recog- former China Ship Building Corp.), and inT developing the sector. Unlike many nized early on that it couldn’t conduct Swancor Renewables. nations that have developed offshore its business without a supply of qualified The result is the Taiwan International wind, Taiwan has almost no marine workers. Windpower Training Center (TIWTC), industry such as offshore oil and gas “We either needed to bring them located in Taichung near the offshore from which to draw workers. Very few back to the UK to train them or we could wind development piers. Certified by Taiwanese have the qualifications or bite the bullet and do something here the Global Wind Organization (GWO), experience to directly enter the industry. that allows us to keep our workforce TIWTC is a 6,000-square-meter facil- Consequently, offshore wind relies trained,” says Tom Manning, deputy ity complete with a 21-meter-tall WAH almost entirely on foreign personnel, general manager of its local subsidiary, (working at heights) training tower – the mostly from Europe. These workers come CWind Taiwan. It therefore decided to tallest in Asia – as well as an indoor pool at a premium, reportedly earning between open a training center to meet its own with depths ranging from three to six US$700 and $1,200 per day. Adding to personnel needs. meters and a four-meter-high diving plat- the problem, COVID-19’s impact on When the government learned of form. There are also facilities for tool use global travel has disrupted the supply CWind’s plans, it saw an opportunity and firefighting training. of those workers, leading to construc- to create a resource that could serve the “We want to create the most realistic tion delays. A report by the Global entire industry. Soon a consortium led offshore wind experience for our train- Wind Energy Council last April forecasts by CWind developed around the training ees so we can provide the industry with demand for 77,000 offshore wind work- center. Other participants are the Taiwan the best workers,” says Michael Li, oper- ers by 2024 in the Asia-Pacific region, International Ports Corp. (TIPC), Taiwan ational manager of the facility. TIWTC offers a six-day Basic Safety Training course, which includes first aid, sea survival, safe and efficient tool use, and WAH and fire-awareness training, providing students with the basic level of qualification for offshore work. During the course, trainees need to jump off the diving platform, work as a team to right a flipped-over life raft, use a fire extin- guisher, perform CPR, and use a defibril- lator. TIWTC also offers a four-day technical training course. Around 30% of the trainees are foreign offshore workers who need to update their certifications, which last two years. Classes are offered in both English and Chinese by a team of trainers that The TIWTC in Taichung has several training facilities, including an indoor pool with includes a climbing instructor, an ex-fire- a deep end of six meters, as well as life rafts that trainees must work together as a team to right. PHOTO: TIMOTHY FERRY fighter, and an ex-military officer. The

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center will soon offer classes in Japanese ing the offshore wind industry remains a nities for overtime pay. An entry-level as well. challenge, as Taiwanese have been slow wind technician currently makes only Since its opening last year, TIWTC to recognize the opportunities presented NT$60,000 per month, but with experi- has graduated over 3,000 trainees, by the industry. Manning says that ence and overtime, the income could rise almost all of whom have entered the the training center serves as a recruit- to NT$100,000 or more. offshore wind industry, and it has plans ment tool, and that interested people are Although offshore wind will proba- to offer more advanced training classes. invited to visit the facility and go through bly be reliant on foreign workers for the While most of the trainees are entry a day or two of training to see if they near future, “at some point the Taiwan- level technicians, several are white-collar like it. Word is apparently getting out. ese are going to need to stand on their workers whose jobs might require them to “We haven’t had a shortage of Taiwanese own feet with this industry, and so they visit a turbine site, particularly insurance applicants,” he reports. need to develop the local workforce,” company employees and marine mammal The Ministry of Labor recently liber- says Manning. “We need to create jobs observers. As with most construction alized labor laws for the offshore wind here for Taiwanese.” industries, the trainees are mostly male, industry that will permit longer shifts, with only around 15% women. allowing not only greater efficiencies — By Timothy Ferry Finding workers interested in enter- for the industry but also more opportu-

RENEWABLES INDUSTRY FACES ENVIRONMENTALIST CHALLENGES

Environmental activists aim to ensure that Taiwan’s green energy revolution is truly environmentally sustainable. But will their efforts slow down Taiwan’s energy transition?

BY TIMOTHY FERRY

he fishing industry is gener- tion in the spring of this year eight kilo- Dolphin, and abusing the fishermen. The ally condemned by environmen- meters off the coast of Yunlin County. fishermen are joined with environmental organizations, and Greenpeace When completed, it is expected to tal lawyers and scholars to demand that hasT often targeted Taiwan’s deep-sea fish- provide clean power to 450,000 homes the construction of the wind farm in their ing fleet for illegal and unsustainable while offsetting 916,000 tons of green- fishing grounds be terminated. practices. Yet in Yunlin County, local house gas emissions annually. Wpd came to a settlement with the environmentalists have found common “The area designated to build the Yunlin fishing association, but protests cause with fishing associations in oppos- wind turbines is of great importance to ensued from a small group of fishermen ing a major renewable energy project the local fishermen, as well as a number who were either left out of the settle- – the US$3 billion (NT$87.8 billion), of local Taiwanese fish species,” the Envi- ment or were dissatisfied with it. This 640-megawatt (MW) Yunlin offshore ronmental Rights Protection Foundation past summer these fishing boats took to wind farm. said in a written statement that accused the seas to blockade the construction site. Developed by a consortium led by the wind developer of damaging the local The fishermen have since ceased their German energy firm wpd GmbH, the ecosystem and killing fish during cable- blockade but continue to protest, and as Yunlin wind farm is one of Taiwan’s larg- laying operations, threatening the survival of the end of September, construction has est to date. It was due to begin construc- of the critically endangered Chinese White yet to begin.

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Protests have also accompanied the to be retired. Taipower is aware of this rollout of solar power in Taiwan, with possibility. While striving to replace coal- solar developers accused of destroy- burning units with natural gas genera- ing natural habitats in rural central and tors at its most controversial power plant southern Taiwan and covering them with – the enormous 5.5GW Taichung power dense solar arrays. Opposition was further station – it is keeping these units on galvanized by the Taiwan Semiconduc- standby. tor Manufacturing Co.’s proposal to clear 230 hectares of forested land in Pingtung Unsustainable solar County for a solar farm. In early July, the cabinet-level Coun- To realize its renewable energy goals, cil of Agriculture (COA) abruptly Taiwan offers a relatively high Feed-in announced new rules that require all Tariff (FiT) – currently NT$3.87 per kilo- solar development exceeding two square watt hour (kWh) – for largescale ground- hectares to gain prior central govern- mounted solar farms. It has also desig- ment approval, putting the brakes on nated over 8,000 hectares of land as most solar development. Previously the The black-faced spoonbill is one of sev- available for solar development with- rule only affected projects larger than 30 eral endangered species potentially out requiring an onerous Environmen- threatened by solar development. square hectares. PHOTO: WIKIPEDIA tal Impact Assessment (EIA) or – prior “The COA July regulations were very to the rule changes – central government shocking,” says Sharon Chen, a solar approval. This practice set off a frenzy of analyst formerly with EnergyTrend, an Not every government ministry seems development, particularly in rural areas affiliate of local analytics firm Trend- fully committed to the 2025 target. that have both available space and grid force. She estimates that around 500MW “While we are all working toward it, access, such as in Pingtung County. of solar development is “completely 2025 is not set in stone. Maybe it will be According to solar analyst Sharon dead” under the new regulations. Energy- 2026 or 2027,” COA Minister Chen Chi- Chen, the smaller EPC (engineering, Trend forecasts solar installations of less chung said at a Legislative Yuan hearing procurement, and construction) firms than 1.2GW by year’s end, well short of on July 14. are the worst violators of environmen- the 2.2GW target. Complicating the situation is tal rules. “The small EPCs don’t have Taiwan has set ambitious goals of the government’s additional objec- any capabilities to solve the land issues eliminating nuclear power and curtail- tive of reducing greenhouse gas emis- or environmental issues; that’s why they ing coal in favor of huge increases in sions and air pollution. Emissions-free often use land that isn’t clearly designated renewable energy and natural gas – all nuclear power currently supplies 12% – it happened in Pingtung quite a lot,” she by 2025. Renewable energy is expected of Taiwan’s electricity needs, accord- says. In her view, they are motivated to to generate 20% of Taiwan’s total power ing to Taipower. Yet strong opposition maximize their return on investment by needs from 5.7GW of offshore wind and in Taiwan to nuclear power means this building cheaply, without taking environ- 20GW of solar power. This year marks portion of the energy portfolio will need mental protection into account. They also the first major benchmark for solar to be replaced. saturate the available space with panels, installations progress. Before the end of The 2025 energy transition goals resulting in habitat loss for critically 2020, Taiwan had aimed to have 6.5GW would also see coal’s share of power endangered species such as leopard cats of total solar capacity, as well as substan- generation reduced from around 48% to and black-faced spoonbills, she says. tial additions to its offshore wind sector. 30% through the retirement of several In response to the land issues, develop- Instead, total solar capacity currently coal-fired power plants. Much of the ers have adopted techniques for floating stands at 4.4GW, according to Taiwan coal-fired capacity is expected to be solar installations, encouraged by a higher Power Co. (Taipower) statistics – over replaced by cleaner natural gas, whose FiT of NT$4.27/kWh. But even this effort 2,000 MWs short of the goal for the proportion of the power generation mix has generated controversy, with develop- year. Taiwan will need to install 15GWs is set to rise from around 38% currently ers once again criticized for oversaturat- of solar power in the next four years to to 50%. But this increase is contingent ing retention ponds and aquaculture sites meet the target – more than 3GWs per upon its own infrastructure expansion, with panels, disrupting migratory birds, year – requiring at least 20,000 square which is likewise facing challenges (more and impacting marine life. hectares for development. With Taiwan’s in the accompanying story on natural With the 2025 deadline looming, envi- factories and barn roofs already largely gas). ronmentalists and solar developers, as covered with solar panels, finding the If Taiwan fails to meet the green well as Taiwan’s solar manufacturers (for space may not be easy. energy and natural gas goals while facing whom the domestic market accounts for Offshore wind development also looks a hard deadline for eliminating nuclear 90% of sales), are all seeking a feasible to be delayed, after encountering several power, it will either face power short- way forward. regulatory and other obstacles (see the ages or be forced to continue operat- “There are 300,000 hectares of uncul- accompanying story for more details). ing coal-fired power plants that were set tivated farmland in Taiwan – please give

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just us 20,000 hectares,” Sam Hong, project specifications allowed them to the developers and investors, the environ- president of the Taiwan Photovoltaic cover 70% of the water surface with mentalists, and all stakeholders – need to Association and chairman of its larg- panels, “but after consulting with experts have a consensus on achieving the goal,”. est solar manufacturer, United Renew- we decided to use only 39% of the he says. “Otherwise everyone will just able Energy, was quoted as saying to the surface, so we actually left a lot more for fight each other., media in early September. the environment.” The goal, he says, was “There is not yet a government leader Integrated solar power producer New not just to generate clean power but also who can make this happen,” he says. Green Power offers a glimpse of how to preserve the area for migratory birds, The Yunlin offshore wind farm solar power can be developed to the including the black-faced spoonbill. controversy perhaps offers a ray of satisfaction of all stakeholders. Founder In response to a request from local hope. When the dispute reached a Andy Tang says that local environmental- residents, the company also committed to crescendo this summer, Deputy Minis- ists were initially resistant to New Green transforming the area into an accessible ter of Economic Affairs Tseng Wen-sheng Energy’s proposal for a 35MW floating eco-tourist destination. “Now people can traveled repeatedly to Yunlin County to solar farm on retention ponds in rural come and see that solar power and the personally mediate a compromise. While Chiayi County. The company decided environment can co-exist, and the locals the debate over Yunlin isn’t entirely to consult closely not only with local are very happy,” Tang says. He concedes resolved, the fishermen’s blockade has community activists but also professors that the broader agenda increased the cost ended, and both wpd and the govern- and other experts in the environmental of the project but says “it still offered a ment express optimism that a solution is and biodiversity fields. sufficient return on investment.” imminent, enabling the project to resume. “We spent lots of time planning how Tang joins a growing chorus call- With effective engagement and leader- to preserve the scenery, which trees to ing for greater leadership on the part of ship, perhaps Taiwan can ultimately real- keep, and how best to integrate the site the government. “To get to 20GW, the ize its goal of being a leader in renewable into the natural setting,” he says. The policy has to be modified because we – energy and greenhouse gas mitigation.

NATURAL GAS TO THE RESCUE

With renewable energy projects likely to be delayed, Taiwan will be relying even more heavily than expected on natural gas.

rom its inception in 2016, Taiwan’s Taiwan has virtually no indigenous store the shipments remains costly and energy transition plan relied heav- gas supplies, however, and relies fully on complicated. In Taiwan, the expansion ily on the use of natural gas. But imported LNG (liquefied natural gas), of this infrastructure has run up against withF solar and offshore wind develop- which requires an expensive infrastruc- local hurdles as well. ment facing possibly substantial delays, ture. For natural gas to be shipped, it Progress in building additional receiv- the importance of the natural gas portion must be chilled to minus 160 degrees ing and storage terminals has been has become even greater than anticipated. Celsius to turn it into a liquified state, slowed by a complicated regulatory The energy transition calls for the then kept at this temperature in special- process, the number of stakeholders, and contribution of natural gas in Taiwan’s ized tankers for shipment to receiving staunch opposition from environmental power generation to increase from its terminals. From there it is piped into groups. As a result, Taiwan’s future natu- current 38% to 50% by 2025. The storage tanks as a liquid before being ral gas supply – and therefore the suffi- advantage of natural gas is that it offers regasified and transported domestically ciency of its entire power-generation the reliability of coal-fired power gener- via local pipelines. capacity – continue to face uncertainties. ation while emitting fewer pollutants While the amount of natural gas Taiwan currently imports around 16.5 and lower levels of CO2. Unlike solar or being produced globally for export has million metric tons per annum (mmta) of wind power, it is available regardless of expanded dramatically over the last LNG to fuel five natural-gas-fired power weather conditions or the time of day. decade, the infrastructure to receive and plants that have total installed capacity

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of 12.3GW. It has plans to add another 8GW (with some older capacity retired). Industry sources estimate that meeting the goals will mean increasing the level of imports to between 23 and 25mmta, depending on the progress of renewable energy. CPC Corp., the state-owned petro- leum company, has two LNG receiving terminals in operation – at Yongan in Kaohsiung and in the Taichung Port. Both have recently added significant capacity. Three underground storage tanks were added at Yongan, bringing capacity to 11mmta. Taichung has completed its Phase 2 expansion by Kaohsiung. supply the new Datan units with natural building three more storage tanks and Tongxiao will also see three of its gas. But with capacity at the Datan plant an additional berth, giving it capacity of older 386MW gas-fired units replaced rising to almost 6.62GW, it seems certain 5.5mmta. with new 893MW combined-cycle units. that the third terminal will be crucial for This summer CPC awarded a contract Due to the delays in gaining environmen- ensuring a long-term stable supply of for front-end engineering and design for a tal impact approval, it remains unsure LNG. planned Phase 3 expansion of Taichung. whether this terminal will be completed Upgrades at the Hsieh-ho Power Plant The project, scheduled for completion in in time to fuel this added capacity. near Keelung also remain under ques- 2026, will provide the terminal with two tion. Two of Hsieh-ho’s four units of more LNG storage tanks and associated Third terminal oil-fired power generators have already regasification facilities. been retired, and Taipower is hoping Still, these expansions will be insuffi- Construction of a third terminal – to replace the remaining two with cient to fuel Taiwan’s growing demand in Guantang in Taoyuan County, adja- combined-cycle gas units. Combined- for natural gas. Work on additional cent to the Datan gas-fired power plant cycle power units combine a gas turbine facilities, held up over environmental – has faced even longer delays. The loca- with a second turbine powered by the concerns, is only now getting underway. tion is within a sensitive marine environ- exhaust heat from the first, enabling the The longstanding plan by the Taiwan ment that is the habitat of numerous rare unit to reach high levels of efficiency. Power Co, (Taipower) to build an LNG species, including a unique type of algal Supplying Hsieh-ho from the third importation terminal adjacent to CPC’s reef. CPC took several steps to mollify terminal would require a natural gas in Taichung was delayed in the Envi- environmentalists, including moving the pipeline running beneath New Taipei ronmental Impact Assessment stage proposed site of the jetty for the tankers City and Taipei City, which is not an over concerns about the preservation to dock and running the pipeline to the option. Instead, Taipower hoped to build of endangered Chinese white dolphins terminal over a bridge several kilometers a smaller LNG terminal dedicated to inhabiting nearby coastal waters. After long. supply the Hsieh-ho plant, but this idea implementing mitigation measures, CPC also reduced the scale of devel- has also run into opposition. Now Taip- the company got the go-ahead. Last opment from 232 hectares to 23 hect- ower is considering placing a floating month it awarded a contract to Taiwan’s ares and pledged to monitor the area to LNG terminal off the coast of Keelung, CTCI Corp. for engineering, procure- ensure habitat conservation. Although but Taiwan’s susceptibility to typhoons ment, construction, and commission- these measures were sufficient for the poses a problem, and the pipeline would ing (EPCC), reportedly for an estimated project to pass its EIA, several environ- interfere with fishing activities. So far, NT$19 billion (US$647 million). mentalist groups remain dissatisfied and this issue remains unresolved. The Taichung terminal expansion is are seeking to put the question of the With Taiwan’s rollout of solar and necessary to supply new power-gener- terminal to a referendum. offshore wind facing potential delays, ation units being installed at gas-fired Despite the opposition, the US$2 the expansion of gas-fired capacity plants at Taichung at Tongxiao. billion project has started. CTCI recently becomes more and more vital. Industry Also last month, GE and CTCI won the NT$18.3 billion (US$623 sources note that Taiwan’s gas-fired units announced a multibillion-dollar deal million) EPCC contract, while Taipower currently operate at only around 60% of with Taipower to supply five 1,300 last year awarded GE the US$1.2 billion capacity. They say that level could easily megawatt (MW) combined-cycle natural (NT$37.5 billion) contract for two be ramped up to 80% or even higher, gas-fired power units. Two of the units combined-cycle units to add 2.24GW to effectively expanding power generation with combined capacity of 2.6GW will Datan’s installed capacity by mid-2023. capacity by 3GW. go to Taichung, while the other three are It is unclear whether construction of destined for the Hsinta Power Plant in the terminal will be completed in time to — By Timothy Ferry

TAIWAN BUSINESS TOPICS • OCTOBER 2020 23

10 CoverStory.indd 23 2020/10/6 上午12:50 ADVERTORIAL Taipower Combines a Stable Power Supply with Environmental Friendliness

The Taipower company is currently emphasizing the increased use of clean-burning natural gas (LNG), the reduced use of coal, and the development of green-energy resources.

he company’s 2019 emission- reduction report card revealed T that, in that year, Taipower had already achieved its original goal of halving its 2016 air pollution emission intensity by 2030. In consequence, Taipower has increased its environmental commitment to further decreasing emissions from its thermal power plants. The new goals are to cut emission intensity by 60% in 2025 and 70% in 2030 from 2016 levels.

Improved efficiency from equipment upgrades

Vice president and chief executive of Taipower’s power generation division, Chen Chien-yih, noted that the utility’s Taichung Power Plant has completed reduce emissions. equipment upgrades for units 1 to 4 and combustion of natural gas drives a turbine At the Taichung Power Plant, for is currently undertaking upgrades for that generates electricity and produces example, coal consumption reached 18.39 units 5 to 10. These upgrades will equip gases with temperatures of nearly 600 million tons in 2014. In contrast, the the plant with the world’s most advanced degrees Celsius. In the second cycle, a heat figure had dropped to 12.64 million tons technologies. “If Taipower says it can recovery steam generator captures these by 2019, a decrease of nearly 6 million be done then it will be done, and the hot gases and uses them to generate more tons. This year, Taipower expects coal promised goals may even be surpassed,” electricity. At present, the efficiency of new usage to fall even further. Chen said. unit has been increased to over 60%. Despite this steady decline in coal In addition to emissions reductions Chen Chien-yih pointed out that reliance, Chen emphasized that Taiwan’s that have resulted from equipment gas-fired power generation produces shortage of domestic energy resources updates, Taipower’s phased approach nitrogen oxides but almost no particulate makes it extremely difficult to become to carry out during unit overhaul has matter or sulfur oxides emissions. entirely coal-free. Although coal also highlighted the company’s efforts to Moreover, through catalytic conversion, consumption will decrease over time, new units can reduce the concentration of retaining coal-fired options will remain nitrogen oxides to below 5 ppm (parts per crucial for national energy security. By million), which is far lower than the 16 to maintaining a coal inventory of more than 20 ppm produced by old units. 30 days, Taipower will be able to cope Chen likened a power plant to a high- with any potential supply disruptions. tech factory. “The operation must be very stable, neither too fast nor too slow. Gas-fired and green energy When measuring power quality, Taipower units complement each other pays special attention to whether it can maintain a constant power frequency and To improve power-generation voltage.” Chen Chien-yih, Vice president and CEO of efficiency, Taipower uses gas-fired, In the future, green energy’s share Taipower's power generation division combined cycle units. In the first cycle, the of total power generation may exceed

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20%. While green energy is carbon-free, commitment to technological adoption it is also an intermittent energy source. has enabled the company to consistently Fortunately, combined cycle units possess improve its performance while ensuring a a rapid start-stop feature that allows them stable power supply. to provide timely support for green energy. In more recent years, Taipower’s When used in combination, the two power commitment to innovation has resulted in sources complement each other to make increased support for the environment. In the power system more stable. 2013, the Wanda Power Plant successfully managed to cultivate a unique species Transforming power plants of endemic Taiwanese soybean that into ecological parks was discovered nearby and transformed itself into an ecological power plant and Chen recalled that when he joined environmental education center. Later, coast and serve as a new landmark for the Taipower 40 years ago, the company through the efforts of its employees, city of Keelung. had just installed its first electrostatic the Linkou Power Plant successfully Moreover, Chen said that Taipower precipitator. At the time, this was re-introduced native lilies to the area will respond to the public’s increasing considered major progress. The company around its facility. Now, the planned concerns about aesthetics by engaging in subsequently affirmed its commitment Hsieh-Ho Power Plant will take the “advanced deployment" – beautifying to adopting the latest technologies creative step of building an observation its power plants and treating them as an when it installed flu gas desulfurization platform on its stack. The platform will opportunity to create largescale examples and denitrification equipments. This provide a panoramic view of the northeast of public art.

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Taiwan’s Tesla Boom, and Looking for More

Formosa Plastics founder Wang Yung-ching failed at building a car business, but his failure laid the groundwork for the country’s successful Tesla supply chain. What are Taiwan’s advantages in the electric vehicle age?

BY KUO-CHEN LU

he global automotive industry ceremony was held for a third factory begun manufacturing cars but could is experiencing a paradigm in May with hopes it can begin produc- not produce engines or gearboxes, shift, sending Tesla’s stock price tion by the end of next year. Company and in effect was little more than soaringT and big Taiwanese manu- Chairman David Shen says that aside an assembly plant. Wang knew that facturers scrambling to expand their from supplying Tesla, Hota has com- without homegrown technology, there production capacity. pleted several projects for European would be no future. In 2017, Chang Chun Group CEO automakers this year. “I’m sorry, Mr. Chairman, but Suhon Lin invested NT$27 billion Why the boom in Taiwan for fac- without the original design drawings or (about US$90 million) to expand his tory expansions in the electric vehicle people to teach us how to do it, there’s production capacity in northern Taiwan supply chain? One reason is that the no way Taiwan can produce engines or and overseas, building nine copper foil strengths Taiwan developed when it gearboxes,” Shen told Wang. plants in Miaoli County alone. Now gained footholds in major automakers’ At one point, Hota bought two just three years later, capacity is still supply chains have complemented Tes- engines and gearboxes and took them inadequate because of the huge demand la’s weaknesses, and Taiwan’s biggest apart, reverse engineering more than for lithium ion batteries for electric weaknesses happen to be in areas where 500 components. The company made vehicles. Tesla is strong. “Aside from engines prototypes of each component to their Even if Lin does invest more, he and complete gearboxes, Taiwan can exact dimensions and speciﬁcations, yet would still have trouble meeting the produce all the other components,” still could not put them together sat- demand for Chang Chun’s copper foil, Shen says. isfactorily. “Car factories in the West which is thinner than a human hair. Lin The origins of this success story can and Japan have been around for more says that based on estimates of battery be traced back to a seemingly unre- than 100 years and deﬁnitely have their demand by international organiza- lated meeting in 1999. Shen recalls own unique experience and tricks of the tions, “building another 60 factories suddenly receiving a call one day from trade,” Shen says. around the world to make copper foil Formosa Plastics founder Wang Yung- In the end, Wang gave up on his for lithium ion batteries by 2023 would ching, asking Shen to meet with him at automotive dream, but the project gave still not be enough.” Formosa Plastics headquarters. When Taiwanese automotive component pro- Also expanding with abandon is they met, Wang, known as the “God ducers the capability to market their the sole supplier of reduction gears to of Management” for his business products abroad. Shen, for example, Tesla, Hota Industrial Manufacturing acumen, grabbed a gearbox and asked pushed hard to expand into overseas Co., whose first factory is in Chiayi Shen, “Can you make the exact same markets, his gears and transmission County. A second plant has just gone thing as this?” shafts gaining footholds in the supply into production, and a beam-raising That year Formosa Plastics had chains of General Motors, Ford,

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Chrysler, and BMW. That’s why when tional car market, may not have the rivals. “If we were only 5% cheaper, Tesla came calling in 2008, Hota was necessary high-speed IT to compete in they wouldn’t have given us an oppor- able to establish itself as the EV maker’s this new realm. tunity,” Huang says. “So we demanded sole reduction gear supplier. Electric vehicles have emerged as of ourselves that we lower our costs by the IT sector’s chance to penetrate the 20%, improve our reliability by 20%, Mobile phone-like game traditional car sector, an advantage and reach 20% power savings – and be Tesla automotive light module supplier able to help clients solve problems and A second key to the boom in Tai- Excellence Optoelectronics has used to do design work together.” wan’s electric vehicle supply chain is emerge victorious. Company president Hsieh Lu-lin, a senior analyst with that electric car manufacturing has Fanny Huang says Tesla is particularly the Industrial Technology Research taken a page out of the mobile-phone focused on LED car lights’ ability to Institute’s Industrial Economics and production playbook. save power, a demand that has helped Knowledge Center, says Tesla has used Roger Liang, the chairman of cable her company overcome competition non-traditional thinking to build cars assembly and wire harness vendor Biz- from conventional automotive car light and lead its supply chain. It encour- link Holding Co., says members of suppliers. ages vendors to work with Tesla in the supply chains of traditional car Traditional suppliers’ “strengths are researching car systems to see where makers have had little interest in elec- production tools, lamp housings, and they can be improved, and refining tric vehicles because EV technologies plastic and metal parts, but they don’t those ideas to foster truly disruptive and specs are constantly changing, a have expertise in power-saving tech- innovation. major challenge for the relatively inﬂex- nology,” she says. Taiwan must seize on that approach ible Japanese and Western vendors. Excellence Optoelectronics can help if it hopes to continue to prosper, Hsieh In contrast, Taiwanese vendors have customers with the design of their prod- says. In the past, Taiwanese manufac- made their living being highly flexible, ucts, including how to maximize their turers would receive orders and fulfill investing in opportunities as soon as reliability, energy efficiency, and cost- them well, but now they have to go a they see one. effectiveness, Huang says. step further, helping clients score break- As a result, major international Still, breaking into the Tesla supply throughs such as how to use fewer electric vehicle makers have gradually chain can be difficult. So why was resources while building more cars. turned to suppliers willing to accept Tesla willing to take a risk on a rel- their style of business and need for atively small Taiwanese outfit rather Plotting the circular economy ﬂexibility. than a big LED maker, such as South In this arena, cars resemble mobile Korean giant LG? Enter Chang Chun’s No. 9 copper phones with wheels. Driverless and The reason touches on the third foil plant in Miaoli and one notices that over-the-air technologies relying on the key to the factory boom – Taiwanese its raw material comes from copper heavy use of data have been critical to suppliers’ flexibility and capacity for extracted from waste electric wire and Tesla’s disruption of the automotive innovation, which have enabled them cable. After the material is turned into industry, a massive shift that has played not only to win but to far outpace their a copper electrolyte, a charge of 50,000 to Taiwan’s strengths. Bizlink Vice President Younger Wang, who is responsible for the company’s automotive customers, cited the example of electric vehicles’ batteries. When you disassemble those batteries, Wang says, you see them as a huge module assembled from 8,000 to 9,000 lithium batteries. Each of those small batteries uses a wire harness to detect temperature, power, and the discharge rate, generating a massive amount of data every second that is accurately transmitted back to the battery management system. High-speed transmission has been second nature to suppliers in Taiwan because of its strong foundation in information technology. But century- old Western or Japanese automotive David Shen, chairman of Hota Industrial Manufacturing Co., says he was approached by wire harness vendors, who have Formosa Plastics founder Wang Yung-ching in 1999 about producing car engines and gearboxes. Now, Hota is the sole supplier of reduction gears to Tesla. swatted away all rivals in the tradi- PHOTO: KUO-TAI LIU, COMMONWEALTH MAGAZINE

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wan’s electric car supply chain took off at about the same point as those in Europe and Japan, it has an opportunity to overtake them,” Liang says. “Tai- wan’s signal transmission technology and electric motors have competitive advantages, and it could start with special vehicles and vehicles used to move cargo. At the very least, they could first meet domestic demand.” Taiwan in fact is capable of manufacturing complete lithium ion batteries, as multinational home appli- ance brand Dyson has shown by sourcing its lithium batteries in Taiwan. Chang Chun’s Lin cites possibilities within his own company’s areas of spe- cialization – chemicals and materials. A factory worker at Excellence Optoelectronics, which manufactures tail lights used in Taiwan is capable of developing the the Tesla Model 3. PHOTO: KUO-TAI LIU, COMMONWEALTH MAGAZINE cathode materials, anode materials, isolation film, and electrolytes needed for amperes is sent through it to draw Quality and safety are the main lithium ion batteries, but the domestic a 5-micron thin foil. It took Chang tenets of any car manufacturer, and battery industry could use some govern- Chun eight years to gain the experi- Tesla is no exception. Certifying sup- ment help, he says. “The government ence and perfect a technology most of pliers can take three to five years, should strengthen its support for the its competitors have yet to master. The which is why Taiwanese companies, industry. Sales of electric scooters are only other company in the world that which account for 75% of Tesla’s growing faster in Taiwan that anywhere can meet this standard is Japan-based supply chain in terms of numbers, are else in the world, and this is an oppor- Nippon Denkai. hard to replace. tunity that cannot be missed.” Another key material used in bat- In the future, however, Taiwanese If Taiwan fails to move in the direc- teries is cobalt, produced mostly in the factories may have to consider set- tion of building its own industry, Lin Democratic Republic of the Congo. ting up shop in China because Tesla warns, its single-minded focus on con- Only 100,000 metric tons of the rare is demanding an increase in the per- tract manufacturing will lead to a metal are produced globally a year. centage of locally sourced parts for its repeat of Wang Yung-ching’s fate of not But when controversy brewed over Chinese-made cars. For the Model 3, having his own brand or technology – cobalt mining practices, Taoyuan-based the goal for local content is 80% by the and ultimately deciding to shut down Mechema Chemicals International end of this year, up from 30% when the the business. began researching how to recover car was first produced there. Currently, Taiwan’s OEM assemblers often cobalt from petrochemical catalysts to Tesla’s production in China accounts serve as little more than punching bags reduce dependence on mining. for 20% of its worldwide output. for international brands searching for Yet even as Tesla’s stock price Alternatively, Taiwanese ven- the best prices. From shoes and apparel soars and sales of electric vehi- dors could decide to develop markets to desktops, laptops, and mobile cles surge, Mechema Chairman Yen outside of China. “Taiwan has compet- phones, Taiwan has never been able to Lung-tsai seems in no rush to expand itive advantages in markets outside of escape this fate. capacity, focusing instead on his next China,” says Hota’s Shen. “The oppor- But with electric cars creating a para- move. Lithium ion batteries cur- tunity at the very least is 750,000 Tesla digm shift, it may be the wrong time for rently being used in electric cars are vehicles.” Taiwan to get complacent and settle for expected to degrade by 2025 and start A key part of the third plant Hota manufacturing parts for Tesla. Instead, to be replaced, Yen says, which is why is building in Chiayi is an R&D center now is precisely the time to search for Mechema is developing technologies featuring seven divisions, with the ways to reverse its destiny of playing to recover cobalt and nickel from used materials, production processes, and second-fiddle to the big vehicle brands. batteries and recycle those materials defect strategy divisions all focused on back into the battery supply chain. quality issues. Shen says Taiwan should — This article first appeared in Tesla demands that its suppliers not be satisfied simply with supplying CommonWealth Magazine and is be both flexible and agile, and just as Tesla, but instead have the courage reprinted with permission from the getting a foot in the Tesla door can to pursue an electric car dream and publisher. Translation from the original be difficult, getting booted is equally develop its own brands. Chinese was done for CommonWealth unusual. Bizlink’s Liang agrees. “Because Tai- by Luke Sabatier.

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With U.S. Cooperation, a Shift in Supply Chains

Taiwan and the U.S. are seeking build alternatives to production of critical equipment in China in the wake of the global pandemic.

BY LOUISE WATT

irst came the U.S.-China “trade communications technology (ICT) that trend. In the early days of the pan- war,” with Washington encour- and other supply chains in a post-pandemic, many countries with a heavy aging American companies to demic world. Major categories in the trade dependence on China suffered a leaveF China and bring manufacturing ICT arena include PCs, smartphones, shortage of supplies, such as ventilators back home. Then COVID-19 struck, switches, and routers, as well as sup- and face masks, that became critical as halting the flow of medical equipment port industries such as semiconductors. the coronavirus spread. and other goods and laying bare the Taiwan is already a critical part of Taiwan mobilized its domestic world’s dependence on Chinese supply global high-tech supply chains, partic- industry and for a time became the chains. ularly for semiconductors – one sector world’s largest manufacturer of surgical Washington has since intensified its in which investment has continued to masks. This achievement demon- efforts to reduce reliance on China – be concentrated in Taiwan rather than strated “Taiwan’s strength as a global even if that means production goes to migrating to China. In numerous other supply chain leader,” David Stilwell, countries other than the U.S. Referring industries, however, tens of thousands U.S. Assistant Secretary of State for specifically to the shortage of critical of Taiwanese companies set up man- East Asian and Pacific Affairs, said in medical equipment, Secretary of State ufacturing facilities in China in recent late August at a forum at the Heritage Mike Pompeo in April said the U.S. gov- decades, with many of the operations Foundation. ernment was holding discussions with focused on selling to the U.S. market. Soon afterward, W. Brent Chris- other countries, including India and As relations have soured between tensen, director of the American Japan, “about how we restructure these China and Taiwan, President Tsai Ing- Institute in Taiwan (AIT), the de facto supply chains to prevent something like wen’s government has encouraged U.S. embassy in Taipei, confirmed that this from ever happening again.” Taiwanese companies to move their the U.S. side had been discussing supply Now the U.S. is bringing Taiwan supply chains out of China, either back chain restructuring with the Taiwan into the fold. In making Taiwan a to Taiwan or to countries in Southeast government for the past eight months. partner in its endeavor to restruc- and South Asia. Since January 2019, “Supply chain resiliency is just one of ture global trade flows, Washington Taiwan has reportedly received US$33 the areas in which Taiwan will play a is actively seeking to help shift inter- billion in such investment, either actual key role in the post-COVID-19 era,” national supply chains in the island’s or pledged. he told a September 4 forum in Taipei favor. Due to Taiwan’s manufac- Now COVID-19 has caused more entitled “Supply Chain Restructuring: turing reliability and shared democratic governments and multinationals to Improving Resilience Amongst Like- values, both governments regard explore how to reduce their own eco- minded Partners.” Taiwan as well-positioned to be a key nomic reliance on China, and Taiwan Taiwanese companies helped to global player in the information and is hoping to be a major beneficiary of develop the ICT and other supply

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chains in China over the past 30 years, Taiwan, and the Taiwan External Trade Industrial Technology Research Insti- Christensen said. “However, in contrast Development Council (TAITRA), a gov- tute, says that COVID-19 had changed to (Chinese) companies, Taiwan firms ernment-sponsored organization that the mindset of CEOs. adhere to the rule of law and protect promotes trade. “It made all the major Fortune 500 intellectual property,” he said. At the event, AIT and TAITRA companies really start to think about Taiwan’s Foreign Minister, Joseph announced plans to strengthen coop- how to reduce the risk so that the Wu, told the same forum that it was eration on supply chain restructuring supply chain is smooth, agile, and ﬂex- “time for a different industrial land- and resiliency, especially in the ICT and ible,” he says. “But when you start scape.” Without mentioning China medical sectors. They also said they to think about how to mitigate the by name, he said that “the outbreak would engage with “like-minded” part- risk, it will incur some costs. The key of COVID-19 has exposed the risk ners with “shared values” to develop is how to share the cost between the of overreliance on a single country or new supply chains that would be resil- brand company and the supply chain supplier for critical materials such as ient in times of crisis. — and the supply chain is very long, medical supplies or pharmaceuticals.” with many, many players, so it is a bar- Wu said that many countries have Shift already occurring gaining process.” started to consider a key question: “If China accounted for more than a medical supplies could be weapon- China’s rising labor costs and its quarter of global manufacturing output ized or politicized during the pandemic, trade dispute with the U.S. have already in 2018, according to U.N. data. In the what would happen if a country’s stra- pushed American, Taiwanese, and other key manufacturing industries of textiles, tegic industries and key infrastructure companies to look for new suppliers high-tech goods, chemical products, and were in the hands of another during elsewhere. To avoid the stiff tariffs the machinery components, China accounts a time of crisis? Another country that U.S. has slapped on goods made in for roughly 40-50% of global pro- does not honor the values of the rule of China, Taiwanese companies have been duction, according to market research law, freedom, democracy, and transpar- moving back home or to other Asian provider Euromonitor International. ency?” countries. Major iPhone assemblers As supply chain lines are redrawn, Taiwan will work with “like- Foxconn, Pegatron, and Wistron have lower value-added and labor-intensive minded partners to establish reciprocal been adding manufacturing capacity in manufacturing, such as textiles produc- industrial ties, ones that lead to joint Vietnam and India. tion and electronics assembly, is likely prosperity instead of coercion, exploita- Analysts expect the fallout from the to go to Asian countries with lower tion and expansionism,” Wu said. coronavirus to accelerate this trend of labor costs. “Taiwan, on the other The forum was initiated by AIT diversifying away from China, par- hand, can compete in attracting invest- and co-hosted by Taiwan’s Ministry of ticularly for products of strategic ments into higher value-added fields, Foreign Affairs, the European Union, importance. Ray Yang, a technology such as semiconductors, batteries, the Japanese representative offices in specialist at the semi-governmental machinery or automotive parts,” says

Participants in discussion before the start of the AIT-initiated Forum on Supply Chain Restructuring. PHOTO: LOUISE WATT

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Justinas Liuima, a senior consultant at Euromonitor. “These sectors require specific skills and know-how, which Taiwan has, and are less sensitive to higher labor costs.” U.S. supply chains are already seeing a shift away from China, particularly in the computer and electronics sector, with Vietnam, Mexico, and Taiwan the main beneficiaries, according to a July research note by Netherlands-based RaboResearch. It said that last year, U.S. manufacturing imports from China dropped by 17% or US$88 billion. Of this, 20% went to Vietnam, 16% to Mexico, and 10% to Taiwan. The benefit to Taiwan came mainly from a shift in printed circuit assembly supply chains, a semiconductor subsector, said RaboResearch for China,” says Yang. followed last month by that of Under economist Michiel van der Veen, as Tai- Taiwan’s government can help by Secretary of State for Economic Affairs wanese firms relocated parts of their setting up more training programs to Keith Krach, who attended a memo- supply chains back to Taiwan, largely increase the supply of high-level engi- rial service for former President Lee because of the trade war. The RaboRe- neers and scientists, including electrical Teng-hui and held informal talks with search report also suggests some engineers and computer scientists, Yang Taiwanese economic ofﬁcials on supply production is moving back to the U.S. says. It can also create more clusters, chain restructuring and other issues. Looking ahead, U.S. imports of similar to the Hsinchu Science Park, Some companies that want to diver- semiconductors can be expected to “for AI and 5G or even 6G,” to facil- sify away from China are currently drop further when Taiwan’s largest chip itate collaboration among companies. focused on surviving the economic fall- maker, Taiwan Semiconductor Manu- Boosting this kind of infrastructure will out from the pandemic, coping with facturing Co. (TSMC), begins operating encourage U.S. companies to locate declines in demand, supply chain hold- a planned US$12 billion chip factory in R&D in Taiwan, not just production, ups, and cash-flow problems. When Arizona. The fab is scheduled to come Yang says. they are ready to explore new options, online in 2024. Promoting Taiwan as a business it will take time to build relationships The shifting of supply chains away alternative to China is Washington’s with potential suppliers. Restructuring from China is a process that U.S. com- latest pillar of support for Taipei, which supply chains will incur signifi- panies must initiate, says Yang of ITRI. faces increasing military, economic and cant costs, and companies will want “The decision maker or the major diplomatic pressure from Beijing. In late to negotiate with governments over driving force is not AIT or the Taiwan August, the U.S. said it was establishing financial assistance, which could be a government, although they can assist a new bilateral economic dialogue with lengthy process. and facilitate,” he says. Rather, it is Taiwan to strengthen ties in the face “We foresee that it will take around U.S. companies that will have to give of Beijing’s pressure. The annual talks two to three years until we see final “advice or instructions” to their Tai- were described as covering semicon- results, as it will take time to ﬁnd alter- wanese partners to shift production ductors, healthcare, energy, and more, native suppliers, regroup transportation away from China – either to continue “with technology at the core,” Assis- networks, and adjust physical facto- to make products for them in a third tant Secretary Stilwell said in an August ries,” says Liuima of Euromonitor. In country such as Vietnam, India, or announcement. the meantime, Taiwanese companies Mexico, or to make specific priority The dialogue follows President Tsai’s face disadvantages in the competition products or components with possibly announcement that Taiwan will ease for new investment. “sensitive or very high-value technolo- its restrictions on U.S. pork and beef, a They have “quite limited positions gies” in Taiwan, said Yang. sticking point between the two sides for in the global supply chain,” and most This process will lead to the cre- more than a decade. Taiwan’s ultimate of their manufacturing activities are ation of brand-new supply chains with goal is to conclude a bilateral trade within Asia, which limits the possibili- new facilities, equipment, and workers. agreement with the U.S. ties for global expansion, says Liuima. Companies that remain in China will be In August, Secretary of Health and Geopolitics may also get in the way. focused on its massive domestic market Human Services Alex Azar became the “Potential political tensions with China only. “Those old supply chains won’t be highest-ranking U.S. cabinet member to might also limit Taiwan’s attractiveness manufacturing for the world, but only visit Taiwan since 1979. His visit was to foreign players,” Liuima notes.

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INDUSTRY A Special Report on Human Resources F CUS Attracting the Talent

iSTOCK PHOTO

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POPULAR GOLD CARD PROGRAM STILL NEEDS STREAMLINING

The special visa program for high-level foreign professionals has become all the more appealing in light of Taiwan’s deft handling of the COVID-19 pandemic, yet bureaucratic obstacles could deter potential applicants.

IN THIS REPORT BY JAMES CHATER

aiwan’s effective management has received since the onset of the of the coronavirus has brought pandemic. Second, she notes the rel- a marked increase in inter- atively stable continued performance Tnational awareness of the country. of the Taiwanese economy, at a time One indication of that recognition when most neighboring countries • Popular Gold Card Program Still Needs has been the significant uptick in have been much more affected by the Streamlining p34 the number of Employment Gold pandemic and its consequences. Cards recently issued to foreign pro- But despite this uptick, shortcom- fessionals interested in living and ings in the program remain, with working in Taiwan. critics citing an application process • For the Startup Scene, Unexpected Help As of the end of January this year, marked by bureaucratic opacity and from Silicon Valley p37 according to National Development slow response times. In addition, Council (NDC) data, 584 Employ- questions remain over the extent ment Gold Cards had been issued to which the Gold Card can help across eight fields of expertise. By remedy the broader economic issues • Taiwan’s Students Face Overseas Study the end of September, that number it was designed to address. Dilemma p40 had risen to 1,000. To mark this The Act for the Recruitment milestone, a ceremony was held on and Employment of Foreign Profes- September 28, in which President Tsai sionals, which created the Gold Card, Ing-wen presented the 998th, 999th, was approved by the Legislative and 1000th Gold Cards to their Yuan in 2017 and came into force respective recipients. The ceremony the following year. Two intersecting was attended by several other holders motivations spurred its adoption. of the card from all over the world. The first was the desire to con- NDC Deputy Minister Kao Shien- front ongoing changes in Taiwan’s quey suggests two reasons for the demographics. In a 2018 report, the increase in Gold Card applications. NDC estimated that by 2026 Taiwan “Taiwan’s visibility has increased will have become a “super-aged” substantially,” she says, citing the society, meaning that over 20% of increased media attention Taiwan the population is aged 65 or over.

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The same report projected that by 2065, finance, law, or architectural design. August, falls into the first category. He the working-age population would con- According to the June statistics, 60% of had been doing visa runs for two and a stitute less than 50% of the total. the cards had been issued through the half years before the pandemic led him The second issue was Taiwan’s weak- economic channel. to apply for the Gold Card. Howard ness in attracting foreign talent. In “The primary driver of applications runs two businesses: BizPayO, which he introducing the policy, the NDC states is coming from people already in Taiwan describes as “PayPal for professionals,” that it was designed to “recruit and who were doing visa runs before,” says and AlgoHive, a marketplace for making attract foreign professionals,” “fill Michael Fahey, a legal consultant at Win- purchases with bitcoin. He also offers domestic talent and skill gaps,” and kler Partners and a chief advocate of consulting services in the relatively new “assist our enterprises to internationalize the Gold Card policy. He estimates that marketing field of growth hacking. their positioning.” those in this category account for around When Howard first arrived in Taiwan, The Employment Gold Card pro- 60-70% of the total. his consultancy clients were predomi- vides significantly more flexible working Among the remaining cases coming nantly based overseas. But he hopes the conditions than other types of visas from those applying from outside Gold Card will give him the opportu- available to foreigners. The card is collo- Taiwan, Fahey notes that many are cur- nity to develop his growing relationships quially known as the “4 in 1” visa since rently originating from places where with Taiwanese clients, most of whom he it provides a resident visa, Alien Resi- pandemic-related restrictions remain found through the Techstars program at dent Certificate (ARC), multiple entry in place. “In places like California, the the Taiwan Startup Stadium. permit, and an open work permit. This schools are shut,” he says. “Applicants For Howard, the advantages of the final benefit is typically viewed as the want to come to Taiwan because so far Gold Card – as well as the quality of life most attractive, as holders of the card it’s safer, and because their kids can be in Taiwan – outweigh the sacrifices often are not attached to any one organization, able to go to school.” associated with relocating to Taiwan, allowing them to remain in Taiwan while most notably the comparatively low changing jobs. Pluses and minuses salary levels. Applicants can apply through one of He believes the growing interest in the eight categories – technology, economics, Marc Howard, an entrepreneur and Taiwanese business environment – with education, culture and arts, sports, consultant who received his card in the Gold Card as a driving factor – will

Recipients past and present of the Employment Gold Card gathered at the Presidential Office in late September to commemorate the issuance of the 1000th Gold Card. PHOTO: OFFICE OF THE PRESIDENT

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10 IF.indd 35 2020/10/6 上午12:54 INDUSTRY F CUS make Taiwan increasingly attractive to He expects to stay at least a year, but will eral government ministries. For example, a particular type of business personality. move elsewhere once smooth interna- information on how to apply is avail- For those in the technology sector, espe- tional travel becomes possible again. As able through the National Immigration cially in Europe and the United States, Chiu’s case shows, the question remains Agency (NIA), whereas guidance on relocating to Taiwan means that you are whether post-pandemic Taiwan will be whom to contact at each relevant min- a “big fish in a small pond.” able to retain recent Gold Card recipients istry is found on the NDC website. “If you want to come here to start the who applied mainly out of expedience. Day says he encountered problems next unicorn, it’s going to be a challenge,” There are also some criticisms of the when seeking information concerning he says. “But if you want to make a fun- program itself, chief among them bureau- salary documentation. To secure a damental change in Taiwan, to really help cratic opacity. Few applicants report that card through the economic channel, a Taiwan become a stronger economy, there their application process went completely monthly salary higher than NT$160,000 are a lot of opportunities here.” smoothly. (roughly US$5,500) is required. How- The experience of other Gold Card Applications for the Gold Card are ever, as a former UN staff member, he holders, however, shows that while the handled by a multitude of government did not need to pay taxes in his home pandemic has made the program more agencies. Documents are first sent to country of Germany and therefore did attractive, there are limits to how much the Ministry of Labor, from which they not have the standard documentation the it may contribute to helping alleviate Tai- are then passed on to the ministry rele- Taiwanese government typically required wan’s economic problems. vant to the candidate’s application, such of applicants. Daniel Chiu, a software engineer, as the Ministry of Economic Affairs for When he took his inquiry to the For- had been working nomadically as a business-related applications and the eign Ministry’s Bureau of Consular consultant for two and a half years Ministry of Culture for those in arts and Affairs, it precipitated what he describes when the pandemic struck. After com- culture fields. as a “goose chase” around various gov- pleting a 24-hour visa run on the day Information on the NDC website ernment ministries – including the NIA, the Taiwanese border shut in March, he implies that authorization procedures NDC, and the Ministry of Labor – all “stumbled across” the Gold Card pro- are basically linear, but applicants’ expe- of whom said that another office was gram. He says finding out about the Gold riences suggest that is so only in the responsible. Card was “a Hail Mary.” smoothest of cases. Many applicants said Deputy Minister Kao says she is aware Chiu, who describes himself as a they did not know who to contact when of such issues and cites the recent surge in “one-man shop,” helps clients – pre- they had queries, and that they were not cases as a reason for the bureaucratic con- dominantly startups – devise strategies informed when their application was fusion. “Soon we’ll have a specific service to “build out their technology.” To passed on to a different ministry. team for the Gold Card that will provide date, those clients have all been out- The complex application process can information on applications,” she says. A side Taiwan, mostly in the U.S., with a be even more challenging for non-Chi- dedicated website with complete informa- few based in Hong Kong. While Chiu nese speakers. For Christopher Day, who tion is also planned. says that he is open to working with works in international peace and con- In the meantime, Dave Fontenot, who Taiwanese clients, the discrepancy in pay- flict resolution, confusion stemmed from received confirmation of his Gold Card ment levels might pose an obstacle. “I’m the lack of a single source for all relevant 83 days after applying, says the bureau- not sure that I’d be able to find clients in information. In particular, he found that cratic sluggishness could be costing Taiwan willing to pay the rate that I usu- information on eligibility was “scattered Taiwan some potential talent. ally charge for consulting,” he says. around” various government websites. In 2013, Fontenot founded Hack- That fact, in turn, has a bearing on his An online search for the Gold Card Match, an organization that connects willingness to stay in Taiwan long-term. brings up websites belonging to sev- software engineers with startup founders.

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As a result of his long background in the the company-stamped tax return that To help navigate the policy changes, industry, he claims to know “more soft- expedites the confirmation process. the New Economic Immigration Act is ware engineers than anyone else in the As one of the few places in the world currently being re-drafted. The new ver- United States.” currently able to operate with relative sion is expected to simplify immigration Since arriving in Taiwan, he has been normality, Taiwan now enjoys an unprec- legislation and relax conditions for for- encouraging other engineers and startup edented degree of appeal to innovators eign professionals seeking residency in founders based in Silicon Valley to apply around the world, Fontenot says, making Taiwan. for the Gold Card. However, he says long it all the more important to capitalize on Deputy Minister Kao also cites waiting times mean that they have often this unique, time-limited opportunity. recently proposed amendments to the Act made other plans by the time they hear “This is Taiwan’s moment,” he says. for the Recruitment and Employment of back. “In the startup world, 80 days is a “People are literally imprisoned inside of Foreign Professionals as further evidence lifetime,” he says. their homes right now, and Taiwan could of the government’s commitment to As a business founder himself, Fon- provide refuge for the brilliant minds of attracting more international talent. The tenot’s experience is instructive. His the world. It’s not doing that right now.” proposed amendments would exempt application required several modifica- Since the onset of the pandemic, the graduates from the world’s top 500 uni- tions, as the government ministry did not Gold Card has proven itself to be an versities from the current two-year work accept the tax statement he initially sub- attractive program for foreign profes- experience requirement when seeking mitted – a problem likely shared by other sionals. But the 1,000 cards issued so far employment in Taiwan. They would also startup founders. Since they are defined should be regarded as just the beginning make it possible to extend a Gold Card, as self-employed, they often do not have of the effort. rather than forcing holders to re-apply.

FOR THE STARTUP SCENE, UNEXPECTED HELP FROM SILICON VALLEY

The severe spread of COVID-19 across the U.S. this spring brought the return to Taiwan of high-level Taiwanese- and Chinese- American talent from Silicon Valley. They are now helping build a similar environment for innovation on the island.

BY JEREMY OLIVIER

he group of 40-something billion-dollar startups. Jameson Hsu, an investor whose pre- Taiwanese-American tech entre- Most of the group members were vious positions include co-founder of preneurs and venture capitalists longtime friends back in the Bay Area Mochi Media and head of Chinese tech thatT refers to itself as the Taiwan Mafia and moved to Taiwan only very recently, giant Tencent’s WeChat USA operation, should not be confused with an orga- mostly due to the outbreak and rapid is one of the gang’s “COVID refugees.” nized crime syndicate. The moniker spread of COVID-19 across the U.S. He says that previously he would travel originated in a 2017 profile of the group beginning in March. One of the excep- to Taiwan for brief visits to meet with in Taiwan’s Chinese-language Business tions – and one of the best-known the engineering teams for his companies, Weekly magazine, which stimulated local members of the group – is Steve Chen, but that this is longest he’s stayed on the interest in the backgrounds and careers co-founder of the video-streaming plat- island since he was a child. of the individuals involved. form YouTube, who in 2018 became the He doesn’t regret making the move, Steeped in the highly ambitious, well- first recipient of Taiwan’s Employment though, and not just because Taiwan has funded culture and history of Silicon Gold Card, a four-in-one residency and been one of the safest places in the world Valley, each of the Mafia’s members has work permit introduced to attract more since the pandemic started. “This place is founded and exited multi-million- and high-level foreign talent. amazing. The people are nice, and doing

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10 IF.indd 37 2020/10/6 上午12:54 INDUSTRY F CUS things is so convenient,” Hsu says. “And a few months of investing in startups local staff, but consistently say that the it’s like we never left San Francisco. All of and working with Taiwanese founders, level of English needs improvement. The our friends have come here.” they have come to see Taiwan as fertile government is acutely aware of this issue; Taiwan was also the first place ven- ground to begin creating a startup eco- the Bilingual Nation program was con- ture capitalist Seamon Chan considered system on par with Silicon Valley. ceived in 2018 by then premier – now when he was told in early March that “There are very good businesses here vice president – William Lai. he would immediately need to leave his – good conglomerates,” Chan says. “And The “refugees” from Silicon Valley executive education program at Harvard there’s lots of ways to work with them applaud the efforts to make Taiwan more Business School. Chan’s partner at the to try to incubate or grow the next gen- bilingual. But they note that beyond New York-based VC firm they started, erations of startups here. I think this is a improving the overall English-lan- Palm Drive Capital, is Taiwanese-Amer- very good opportunity.” guage level and environment, fluency in ican and both had heard that Taiwan had Particularly attractive for the Taiwan technical jargon and industry terms in been handling the coronavirus outbreak Mafia was Taiwan’s store of highly English is also critical for talent devel- effectively since day one. skilled, highly educated talent. “After all opment and industrial innovation in “Palm Drive has been working with of us had been here and explored invest- Taiwan. Chin Chun-ming, a former tech- Taiwan investors and startups for a ment opportunities and worked with nical program manager at Microsoft and while,” Chan says, noting that the firm startups and mentored people, we real- the Taipei-based co-founder and director had partnered with Cathay Financial to ized that Taiwan has a lot of really smart, of engineering at the startup Blocktag, invest US$20 million in a U.S. AI health- capable people,” Jameson Hsu says, says that English-language skills for care startup called Clover Health. “We musing that “it’s almost like we stum- engineers is important not only for com- came here right before COVID-19 hit bled on this goldmine and no one’s really munication with U.S.-based headquarters in the U.S. because we were previously mining it.” and foreign colleagues, but also to stay donating a lot of masks to China and There are, of course, several reasons abreast of the most cutting-edge techno- knew that it was going to get worse in why Taiwan may have been overlooked logical developments. the U.S.” in the past, not least of which is the Chin, who is from Singapore – one of Not wanting to sit still for long, Chan geopolitical situation. China’s fraught the models that Taiwan seeks to emulate and others in the Taiwan Mafia have hit relationship with the U.S. and its territo- in its bilingualization efforts – notes that the ground running, exploring ways to rial claims on Taiwan continue to loom big U.S. tech companies such as Google support and build up Taiwan’s nascent large in the minds of overseas investors. and Facebook publish papers and blog tech startup scene, as well as to use their Language plays a role as well. Compa- posts in English discussing technolog- accumulated knowledge and experi- nies with substantial operations in Taiwan ical breakthroughs and new trends. “So, ence to cultivate local enterprises. After praise the work ethic and loyalty of their if you know your English well, then you

Members of the Taiwan Mafia, a group of investors and tech entrepreneurs previously based in Silicon Valley, at their Taipei base of operations in the Taiwan Tech Arena. PHOTO: TAIWAN MAFIA

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know what’s happening right at the front attractive to foreign talent and invest- lines,” says Chin. These publications ment, Juan says, the thinking of many of are generally consumed, and their ideas those in authority is still dominated by an applied, first by U.S. enterprises. They OEM/ODM manufacturing perspective. then move on to Europe, and the cycle After attending a recent event fea- continues until they land in Asia.” turing a speech by a Cabinet minister, “So, there’s this time lag, which has Juan says he found that much of the pre- been persisting for decades,” Chin says. sentation dealt with how Taiwan can be This poses a major challenge for Taiwan’s a supplier for companies creating inno- startup scene. “If you want to be a leader, vative products elsewhere. Instead of you need to go directly to the source. You continuing along that same road, Juan cannot wait until traditional mainstream says, what Taiwan needs to do is create news reports on some breakthrough to its own brands. get started. By then, it’s too late,” he says. “If you want to build a brand, you Chin’s proposed solution is for need an environment that is less restric- English to receive more emphasis in tive in terms of government regulations engineering education. At present, the in areas like setting up firms and hiring primary language of instruction in engi- international employees,” Juan says. neering classes at Taiwan’s higher "Taiwan’s government has to do less. education institutions is Chinese, though They try to protect our locals and ensure textbooks may be in English. our job security and ensure the big brands won’t just cherry-pick our leading Venture capitalist Seamon Chan arrived talent and leave the others jobless. It's Paradigm shift in Taiwan right before the pandemic began severely affecting the U.S. understandable, but it won’t fix struc- Another strong headwind to creating PHOTO: SEAMON CHAN tural problems.” a more disruptive, innovative startup Juan and others point to the examples ecosystem in Taiwan is a culture that is to play it safe that gets baked into society of Singapore, South Korea, Switzerland, traditionally risk averse. This obstacle from early education. An example that Ireland, and Israel – small countries like hinders startups’ ability to create strong Hsu cites from the startup world relates Taiwan, but which have achieved marked and lasting ties with overseas hubs like to stock shares. Whereas in Silicon success in cultivating strong startups. As Silicon Valley and Israel, says David Valley, many employees at startups are of the end of last year, Israel had pro- Chang, founder of online translation happy to accept equity in lieu of high sal- duced 20 unicorns – more than France, platform Wordcorp and co-initiator of aries in expectation that the share value Germany, and Australia combined. Even the Taiwan non-profit Crossroads. A will increase over time, that practice is South Korea, a country with a similar kind of cultural shyness is still prevalent rare in Taiwan. Taiwanese employees history and cultural background as Tai- here, says Chang, preventing companies prefer the safer bet of a steady income in wan’s, has had 11 unicorns emerge in the from making the kind of connections that an established industry. past two decades. would allow them to expand their prod- The low appetite for risk in enter- Palm Drive’s Chan, while enthusiastic ucts and solutions to other markets. prise-building is understandable, Hsu about the Taiwanese startups he and his “When we ask why there isn’t a says, considering the legacy of high-tech partner are currently working with, also Taiwan unicorn yet, it comes down to hardware design and manufacturing on understands the limitations posed by the the reach and cultural aspects of the which Taiwan built its modern economy. more conservative model of doing busi- startups,” says Chang. “You might have “Hardware is very time- and capital- ness in Taiwan. He sees the assistance success in the local community, but you intensive,” Hsu notes. “There’s very little of Silicon Valley veterans as just what need the on-the ground connections and margin for mistakes, so you can’t take Taiwan needs to overcome its past short- people running a branch or who have big risks. You have to be very precise comings. insight into other markets.” with every step that you take.” “The thing about Taiwan is there’s a A lot of Taiwanese startups have the It is a pervasive mentality, even among lot of good talent here, but they’re good right spirit, Chang says, but they may be those in industry and government who at building products and not as good at looking only at local problems because are more forward-thinking about Tai- marketing and fundraising,” Chan says. doing so is safer than taking the risk of wan’s future. John (Jian-chen) Juan, a “That’s why the arrival of these Silicon reaching out to communities overseas supply chain analyst for Microsoft U.S.’ Valley people makes for a great combina- who speak different languages and have cloud business who is originally from tion because they have all this experience different work cultures. Taiwan, returned in March when the raising millions of dollars.” Despite the optimism among many pandemic began spreading in Washington Jameson Hsu shares the view that Taiwan Mafia members about Taiwan state where he was living. Despite the Taiwan needs a paradigm shift from and its potential, they recognize the cul- government’s good intentions to boost contract manufacturing of hardware tural barriers as well – chiefly the desire core industries and make Taiwan more products toward pioneering innova-

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10 IF.indd 39 2020/10/6 上午12:54 INDUSTRY F CUS tive software solutions and recognizable brands. The Mafia is now working toward the goal of gradually bringing CLOSING THE ENGLISH-LANGUAGE GAP the Silicon Valley culture and attitude of “move fast and break things” to Taiwan. Bilingual Nation is a national, comprehensive set of policy initiatives To do that, they’re moving on from just aimed at improving English ability and elevating national competitive- investing and mentoring to starting their ness, with the ultimate goal of making Taiwan fully bilingual by 2030. As own companies and recruiting high- part of its blueprint for this goal, the government has suggested such potential local talent. steps as establishing all-English television channels and radio program- “That’s the whole point of the ming, making all government procurement documents and websites Taiwan Mafia: we want create something bilingual, and encouraging local businesses to enhance their English to uncover all of these talented people,” proficiency, among several other steps. Education in English for K-12 Hsu says. “If they do want to take those students is one of the major components of the initiative as well. risks, if they do want to create things, The point of starting bilingual education so early, says Minister with- but there just aren’t the opportunities out Portfolio Audrey Tang, is to ensure that in 10 years, the “adult or available to them – whether within a young adult population is comfortable with English.” Because English company or entrepreneurially – let’s use has never been part of Taiwan’s history or culture, it “may take a little bit the Taiwan Mafia to attract these people of time before we can include it as one of our national – or official – lan- and begin fostering a new kind of risk- guages,” Tang says. taking ambition.”

TAIWAN’S STUDENTS FACE OVERSEAS STUDY DILEMMA

Every year, tens of thousands of Taiwanese leave to pursue degree programs in the U.S. and elsewhere, but the pandemic is forcing them to make a tough choice this year: go ahead with their original plan, take courses online, or defer their studies altogether.

BY JEREMY OLIVIER

hether to stay in Taiwan where the COVID-19 pandemic has been effectively Wquelled or take the risk and travel overseas to places where coronavirus infection and death counts are still wor- ryingly high: this is the calculation many Taiwanese students originally scheduled to travel abroad for their undergrad or graduate studies were making this summer. While the ongoing pandemic has had a well-reported negative impact on a number of Taiwan’s industries, the effects of the virus on Taiwanese students

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looking to complete their studies abroad a few deferring a full year,” says Yu. online but thought better of it when have been less visible. “While many of these students made the he realized the time difference would The decision to study overseas is decision themselves, some universities have him staying up until all hours of one that an increasing number of Tai- are requiring that students defer only one the night. Some universities have been wanese young people had been making semester.” more accommodating to students taking each year, whether it’s to gain some valu- For Tu Cheng-yin, the choice to defer classes remotely in Europe and Asia, able experience in another country and a full academic year was clear. Tu, a though. Hank Lee, a graduate student eventually return home or to begin long- graduate of the electrical engineering at Columbia University, says that most term careers abroad. According to data department at National Taiwan Univer- of his online classes start around din- released by the Ministry of Education, sity, had been accepted into the State nertime. He adds that he’s had a good over 41,000 Taiwanese applied for and University of New York at Buffalo’s mas- experience with the format so far. received student visas for other countries ter’s program in robotics. When the “My program originally incorpo- in 2019, up from around 33,000 in 2009. pandemic was peaking in New York state rated online study, so my professors are More than 30% of those students pur- in April, however, he decided that going pretty good at teaching in this format,” sued their studies in the U.S. ahead with his original plan wasn’t worth Lee says. “Also, we are mostly using However, based on the experience and it. Instead, he stayed behind in Taipei and Zoom for the classes, which is a conve- observations of two study-abroad organi- launched a 5G-focused startup with some nient platform and has nice tools, like zations, OH! Study and USEAS, around friends. breakout rooms for smaller groups.” half or more of these students have “What we are proposing is to offer The only downside, he says, is that decided that going to the U.S. or else- free rapid 5G internet to international there aren’t many opportunities to get where is simply not worth the risk this travelers and pay for it with other acquainted with his classmates outside of year. Jeffrey Yu, Overseas Study Man- sources of income, such as advertising,” the lessons. Everyone just logs off right ager for USEAS Taiwan, says that Taiwan says Tu. “We’re thinking that if we can after the class is over. has proven to be such a safe option that get it up and running this year, this idea Lee found out he had been accepted many of the company’s clients have opted can be carried out outside of Taiwan as into Columbia’s Master of Arts in Sta- to defer their studies until the coming well.” He adds: “If we go to the U.S., we tistics program while he was fulfilling spring semester or to fall 2021. could bring some of the work with us, his compulsory military service require- “I would say around 60-70% of the and promote the company’s services to ment in Taiwan this past spring. Like students who decided to defer chose to people planning to travel to Taiwan.” Tu, he saw the situation in New York do so until the spring semester, with only Tu had the opportunity to take classes worsen throughout March and April and

TAIWAN BUSINESS TOPICS • OCTOBER 2020 41

10 IF.indd 41 2020/10/6 上午12:54 INDUSTRY F CUS he had already put off getting his master’s degree for almost two years while he finished an undergraduate double major and then completed his military service. He felt he couldn’t wait any longer and left for France in August with the blessing of his parents. Jack had received information from the school about safety and prevention protocols on campus and was requested to provide a negative PCR test result for COVID-19 upon his arrival. How- ever, when he showed up on campus the first day, his test result was either briefly glanced at or ignored altogether by the school’s administrators. He also noticed that virtually none of the virus prevention guidelines were being observed or While most Taiwanese students have decided to take the safer options of deferring their studies or taking online classes, some are taking the risk of beginning their degree enforced. programs abroad this year. “Almost no one is wearing masks, people are having big parties, and stu- ultimately decided to stay in Taiwan. the fall, the university did not see a large dents are using one access card to let However, he says he is optimistic that number of student deferrals this year. other people into the dormitories” Jack things will be better by the spring While some students may be taking says. “In the school canteen, everyone semester, with shops and services back online courses this fall because they feel sits together and ignores the stickers open as normal. that otherwise they would be squan- they’ve put on chairs to encourage social “In the end, I decided to stay here and dering a semester, Jeffrey Yu of USEAS distancing.” take online courses this semester because says that there are also some tangible Student behavior got so risky that by the time I had made up my mind benefits to this approach. the dean of students had to send out on whether to go, there were only four “Some universities’ online classes are a campus-wide email, urging stu- months left before the next semester,” cheaper than their in-person ones, some- dents to follow the school’s rules. Then, Lee says. “It would have been very dif- times by as much as US$500 per credit,” after some students tested positive for ficult to find an internship in those four Yu says. “In addition, some of these COVID-19 in September, all of Jack’s months. Most require you do at least half courses are considered ‘credit-bearing,’ classes moved online for two weeks. a year and that you currently be enrolled meaning that they apply toward the Jack says he’s also observed what in a degree program.” degree and students that take them do could be considered discriminatory or Despite some of the setbacks com- not have to extend their graduation at racist behavior among some locals since monly encountered with online learning all.” Those students would also still be arriving. “I always wear my mask when tools – inconsistent internet speeds and eligible for optional practical training I’m out and about, but I’ve noticed that audio/video quality, professors with lim- (OPT), which allows them to live and some local French will only put on their ited digital literacy or experience teaching work or intern in the U.S. for a year after masks once they come near or pass by me online, and others – taking remote classes they graduate. Those in STEM fields can or other Asians,” he says. this semester is an extremely popular do so for up to three years, says Yu. Despite wanting his education abroad choice among international students. to be a true cultural experience, Jack has “Most of our international students The third option instead mostly been sticking with other will choose to study remotely from their Asian students since arriving in Paris home countries,” Sheri Ledbetter, a com- While staying behind in Taiwan for a because they’re typically more observant munications officer with University of semester or year might seem like a safer of virus prevention measures than his California Irvine told TOPICS in an choice to most, both Tu and Lee note European peers. He says he nevertheless emailed statement. “There are some chal- that a number of their classmates and wants to stay the course and finish his lenges to travel to the U.S. given limited friends have chosen to take the risk of studies in France unless the situation gets operations at U.S. Consulates, and the starting their overseas study programs in much worse, and his parents have been requirement for a minimum of at least person this fall. supportive of his decision and dedication. one in-person course for [visas for] new One student TOPICS spoke to, who “I feel like yes, it’s dangerous, but as students.” However, Ledbetter surmises, preferred to go only by his English name, long as I don’t go to parties and keep since UCI was one of the first UC cam- Jack, was accepted into a master’s pro- wearing my mask – stay vigilant and puses to announce that it would offer gram in business management at a take necessary precautions – I should be all undergraduate courses remotely in prestigious school in Paris. He says that okay,” he says.

42 TAIWAN BUSINESS TOPICS • OCTOBER 2020

10 IF.indd 42 2020/10/6 上午12:54 AMCHAM EVENT

AmCham Taipei Celebrates 69 Years of Outstanding Service and Leadership

n September 17, AmCham Seewald noted, and in terms of its Taipei commemorated its advocacy efforts, it works mostly O 69th anniversary with an with the central government on evening celebration at the Man- issues of regulatory policy. darin Oriental hotel. Over 100 Huang Shan-Shan, deputy mayor guests, including members new and of Taipei city government, briefly AmCham Taipei Chairperson CW Chin and deputy mayor of Taipei City Huang longstanding, dined on the hotel’s addressed the guests, empha- Shan-shan. delicious international cuisine, sizing the work of the Invest Taipei caught up with peers and friends, Office. ITO is a one-stop platform and raised a toast to the Chamber’s established by the city’s Depart- more than six decades of out- ment of Economic Development SPONSORED BY standing service to the international to assist domestic and overseas business community. The event was companies and entrepreneurs by sponsored by SGS and the Invest providing them with knowledge and Taipei Office, and drinks were pro- understanding of Taipei's business vided by Diageo. environment, as well as of related To kick off the evening, policies and legislation. AmCham Taipei Chairperson CW Chin gave a short speech describing the Chamber’s dedication to further improving the business environment for its members and to strengthening the economic relationship between Taiwan and the U.S. Leo Seewald, president of the Chamber, then announced that AmCham Taipei is in the process of under- going a name change – to the American Chamber of Commerce in Taiwan – to better reflect the organization’s scope and respon- sibility. AmCham’s membership encompasses the whole of Taiwan,

TAIWAN BUSINESS TOPICS • OCTOBER 2020 43

10 Anniversary.indd 43 2020/10/6 下午3:13 ADVERTORIAL Key to securing a robust investment environment in Taiwan amid the pandemic: Serious attention to stakeholders

hile COVID-19 has spread inclusiveness,” the core driver behind the However, considering the export-oriented throughout the planet, Taiwan Taiwan Model. In fact, adopting such nature of its economy, Taiwan is still W has achieved great success in fundamental values in policymaking vulnerable to reduced global trade flows controlling the virus at home. Indeed, has been promoted for decades by the and recession, and the pandemic will the Taiwan Model is now studied by international business community, and it is inevitably hurt Taiwan’s overall economic many countries as a new standard and encouraging to see the Taiwan government performance. As a matter of fact, Taiwan's has served as a point of pride for all fully realize these values when establishing official statistics bureau lowered its Taiwanese, as noted by Premier Su Tseng- its disease control policies. forecast for the country's economic chang in his oral policy report to the What is particularly noteworthy is that growth in 2020 to 1.56% after negative Legislative Yuan in May 2020. these fundamental values are even more growth was reported in the second AIT Director William Brent pivotal during the “late pandemic” phase quarter. Christensen also hailed the Taiwan in driving economic momentum on the As Premier Su pointed out in his policy Model in remarks at the 52nd AmCham island. By incorporating the concept report, the government is shifting from Hsieh Nien Fan Dinner in August 2020. of real stakeholder inclusiveness, the a defensive to an offensive posture with “The very core of the Taiwan Model is government will be able to shape a its relief and stimulus measures, and is democratic values – transparency, press reasonable and predictable regulatory encouraging greater investment in Taiwan and internet freedom, rule of law, and environment in which to foster stable by both domestic and foreign enterprises robust communication between the business operations and greater as one of the key pillars to boost economic government and the governed,” he said. investment. growth. Indeed, transparency and robust Thanks to the Taiwan Model, the However, in contrast to its priority of communication between the government impact of the pandemic on the island’s stimulating the economy, the government and the governed in the policymaking domestic economy has been under more recently also proposed several extreme process create “real stakeholder control than elsewhere in the world. and unproportionate policy proposals that

44 TAIWAN BUSINESS TOPICS • OCTOBER 2020

JTI.indd 44 2020/10/6 下午5:15 ADVERTORIAL

would damage the already vulnerable operating and investment environment. One example is the proposal by the Health Promotion Administration (HPA) of the Ministry of Health and Welfare on May 29, 2020 to amend the Tobacco Hazard Prevention and Control Act (THPCA). The HPA provided a 60-day consultation period for the proposed amendments, inviting comments from the general public. This THPCA proposal includes several controversial measures, including a ban on the use of flavors in cigarettes, which would drive consumer demand 5 towards smuggled, illegal products. The proposed amendments also require enlarging the size of on-pack pictorial health warnings from the current 35% to 85% of the space, which would make it easier to produce, distribute, and sell counterfeit and contraband products. If enacted, these extreme measures would disrupt the legal tobacco market, seriously infringe on the legitimate rights of domestic and foreign enterprises, and exacerbate the uncertainty and unpredictability of Taiwan’s investment and business operation environment. This is a particularly risky move, considering the current global economic crisis and domestic recession. To avoid inconsistent policy directions and negative consequences for Taiwan’s economy brought on by 5 extreme measures such as the THPCA amendment proposal, we urge the government to continuously invite and take seriously the opinions of related stakeholders, and to provide reasonable responses. Doing so would extend the “real stakeholder inclusiveness” approach from the policymaking process for pandemic prevention to all measures taken by the 0050 government. We recognize the government’s efforts to enhance regulatory transparency by providing a 60-day consultation period on its regulatory proposals since 55 2016. However, this mechanism should be considered only the first step. We encourage the government to further enhance its level of attention to all stakeholders and their input. As indicated in AmCham’s 2020 Business Climate Survey, less than 27% of the respondents were satisfied with the general level of attention given by Taiwan’s top policymakers to the needs of business, as well as their level of engagement with the private sector, in setting relevant policies. 00 “I want to assure you that my government is committed to securing a robust investment environment to the benefit of us all,” President Tsai promised the 00 international business community at this year’s Hsieh 定定 Nien Fan dinner. We appreciate her determination and hope that the government will realize that the key to securing a robust investment environment amid the COVID-19 pandemic is to pay attention to all stakeholders and take their views seriously. BY JTI BY JTI

TAIWAN BUSINESS TOPICS • OCTOBER 2020 45

JTI.indd 45 2020/10/6 下午5:16 EXECUTIVE SUITE

Meet Matthias Bausenwein of Ørsted

Matthias Bausenwein, Asia-Pacific President and Taiwan Chairman for Danish wind energy company Ørsted, didn’t originally intend to forge a career in Asia. But reflecting on the past four years he’s spent here, he’s happy where he landed. Asia, and Taiwan in particular, is a huge new market for offshore wind, and Bausenwein has led his team through success after success here.

Bausenwein and TOPICS Deputy Editor Jeremy Olivier sat down recently to discuss Taiwan’s unique advantages and challenges for renewable energy developers, some recent developments at the company, and Bausenwein’s adaptive management style.

You have a master’s degree in eco- my experience and education would degree of uncertainty, but also a lot of nomics and business administration and help me with really making something excitement. have taken executive education courses happen here. on business in Asia. How did your edu- What observations do you have on cation prepare you for your eventual What initially attracted you to the the wind energy industry in Taiwan career? How did it help with your tran- wind energy business? Why did you compared to Denmark and your native sition to leadership roles in the Asia- choose it over other business fields? Germany? How do you find doing busi- Pacific? I initially worked in management ness here? My university education in Germany consulting after graduation, mainly in In terms of similarity, there is a need provided a strong general basis for the automotive, energy, and health- for renewable energy in Taiwan due to business and would have been helpful care sectors. When I had the chance to issues with air pollution and emissions, for going into any sector. The rest of do some work in renewable energy, I as well as opposition to nuclear power. my education was mostly learning on found that I really liked it. I wasn’t in a Furthermore, there is good, strong the job. big rush to find a specific industry back wind in Taiwan, and a lack of space In the early days, I tried not to be then, so I waited for the right window onshore. There is also a very good too specialized in any one area, but of time to find one that I would be framework in place for getting permits rather determine the right industry for really excited about. and registration. These aspects in com- me by getting some broad experience. At that time, no one really knew bination make for a good foundation Once I found my niche, I decided to what would happen with offshore for growing the offshore wind energy take the executive education courses, wind; it was a very niche industry. sector. This brings a kind of push from learning about leadership and business When I started, a lot of the wind energy the public and government that I’ve systems in Asia. sector was focused around Denmark, also witnessed in certain markets in I had always been interested in doing so I went there early on. The industry Europe. business internationally, and from a had yet to consolidate and was tran- Now, where Taiwan differs is that it renewable energy perspective, I knew sitioning from one dominated by is a new market, unlike Europe where it was the right moment to come here experienced and strong personalities wind power has been around for almost when I did. Asia is growth market into one that could potentially scale 30 years. So, while there is a positive number one for renewables, and I knew up and professionalize. So, there was a attitude and strong ambition, a lot of

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the basic necessities are not yet in place. is that local sub-suppliers not only terms of leadership because my manage- We thus need to work together as an deliver to Taiwanese projects but go ment team and the Ørsted team here in industry to overcome some hurdles. regional or global as well. Asia have varying degrees of experience. The newness of the industry in The fund also seeks to nurture off- Sometimes I need to be very involved Taiwan means there is also a limited shore wind professionals. Talent is in coaching or explaining the details, understanding of what offshore wind one of the key bottlenecks in Taiwan, while at other times I need to give them means to the local stakeholders, and we since the industry is so new. Taiwanese space and just let them do their job. therefore need to educate people and graduates generally choose to go into Now, what I described earlier as explain what the benefits are. It’s not semiconductors and high-tech, or they a positive attribute – being enthusi- just clean energy; there’s a lot of direct go abroad because the salaries here are astic, trying to do new things – that and indirect job creation as well. low. We need to explain to them that can easily turn into a weakness. Some- In general, there’s a very strong there is this new, exciting sector that times, if you’re constantly anticipating agenda to localize the supply chain has started big and is also here to stay. the next big challenge, you don’t get here. This is not unusual per se: gov- to stop and appreciate the feats you’ve ernments everywhere have high local What are the most challenging and already accomplished. And so, I try to content expectations for new indus- most fulfilling aspects of expat life? Are tell myself and my team to slow down tries, especially in the initial phase, there any that are particular to Taiwan? and take some time to be proud of our when infrastructure and energy proj- To be honest, I don’t consider my life achievements. ects are still subsidized and where here to be that of an “expat.” I came there is a keen interest to build up here with my family, and we did not What advice do you have for young local suppliers. view this as a temporary move. I per- people looking to get involved in the We see, however, a very rigid sonally saw it as a mission – to start energy sector? approach to localization in Taiwan, something big and long-lasting here. This is a pretty cool, high-growth which I think may become very Taiwan is a great place for for- industry and it’s totally different from unhealthy for the industry, to the point eigners, one that I think is very where energy was even just a decade where it could actually stall develop- underestimated by international trav- ago. Offshore wind has turned into ment. What we need is competition, elers. I myself didn’t face too many an exciting sector that’s present in our reasonable prices, and flexibility challenges because I had been trav- daily lives, and it has a long-term char- because if the local content rules are eling to Taiwan and Asia for many acter. My key advice to young people is very strict, that could create a less com- years before we decided to invest and thus to be very interested and to under- petitive environment. Moreover, it open an office here. Still, living here is stand that while offshore wind takes won’t prepare Taiwanese suppliers to very different than traveling in and out time, it can also be very rewarding. compete in the region or globally. and being in a hotel. You need time Know also that this is an area where In terms of the general culture, I to adapt, but that’s normal, and it is a you can really make a contribution. We don’t think there is a better place to minor inconvenience at most. are helping transition the energy sector enter in Asia than Taiwan. There’s a In general, people are so friendly and from black to green, reducing emissions, very international mindset here and a open-minded, and a lot of them speak and working toward climate goals. It’s friendliness toward foreign investors. good English. It is fairly easy to accli- important that you have an underlying It has been very professional, interna- mate and we’re very happy here. motivation for your career, that you tional, and not so different from other know you are doing something good. new markets in Europe. Do you have a particular style or philosophy as a manager? What do you How do you like to spend your lei- Ørsted recently launched a NT$60 consider to be your main strengths? sure time? What activities make you feel million Offshore Wind Industrial Devel- Any weaknesses? “recharged?” opment fund in Taiwan. What gaps will Overall, I don’t want to predict I like to play basketball and soccer, this fund fill in the island’s wind energy what could happen, but rather create and I enjoy some outdoor activities. I development? what will happen. When Ørsted started didn’t hike or cycle before I came to What we are aiming for with this in Taiwan, we took kind of a startup Taiwan, but I do it a lot now that I’m fund is to strengthen Taiwan’s local approach to management. I’m person- here. I also spend a lot of time with my sub-suppliers, providing them with the ally very curious and enthusiastic about family – I have a wife and four kids. It’s necessary resources – whether human changing the energy sector and I aim to very busy, very lively, and it requires or financial – to ramp up their capabili- transfer this enthusiasm to my team to that I switch off from work and focus ties, standards, structures, technologies, motivate them accordingly. I want them my full attention on them. and training, and enable them to even- to feel like they’re starting something Lastly, I really like to travel, both for tually enter into the offshore wind new and to have this entrepreneurial business and for leisure. It’s unfortu- sector. We do, in fact, want local- desire to make tangible changes in the nate that we are unable to travel abroad ization, but we don’t want it to be a world. recently, but we’ve enjoyed traveling all showstopper. One of the ultimate goals It is also important to be adaptive in over Taiwan in the meantime.

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MB.indd 47 2020/10/6 上午12:55 SEEINGSEEING TAIWAN TAIWAN

The Lily and the Butterfly: Mountain Motifs in Taiwan’s South

War II was finally reopened. During the decades of isolation, chil- dren grew up speaking only the tribal language (which, like all of Taiwan’s Austronesian languages, is totally different from Mandarin and other or centuries, the Central Moun- they are one of Taiwan’s smaller ethnic Sinitic languages). Trading with the tain Range that stretches nearly groups. Despite being few in number lowlands was difficult, so the inhab- the length of Taiwan blocked and spread over a substantial area, the itants of this stunningly scenic valley theF eastward progress of Han Chinese tribe has an intricate social structure subsisted on millet and sweet potatoes pioneers settling the western lowlands. comprising hereditary chiefs, nobles of grown on stony terraces, supplemented As a result, the traditional cultures and varying ranks, and commoners. by hunting and gathering. lifestyles of the Austronesian indige- Compared to other indigenous Ecology experts have praised Rukai nous people in the east remained largely communities, the Rukai in Pingtung’s hunting traditions for their sustainabil- intact until the 1895-1945 period of Wutai Township did not interact much ity. Elders often postponed expeditions Japanese colonial rule. with the outside world until after 1972. after listening at dawn for the song of Some of the Austronesian tribes That year, a colonial-era road which particular birds and deciding the omens that were living in the western half of had been abandoned soon after World were not right. Tribesmen hunting Taiwan in the 17th century assimilated into Han society. Others migrated from the plains to foothill regions deep in the interior. Even now, several townships within sight of the Central Mountain Range are majority Austronesian. In Taiwan’s far south, the mountain range doubles as the boundary between Pingtung County in the west and Taitung County in the east. One in 12 of Pingtung’s 815,000 residents has indigenous status, most of them members of the Paiwan tribe. The other significant tribe in Ping- tung – and in neighboring Kaohsiung’s Maolin District – is the Rukai, sometimes known as the Drekay people. With a population of around 13,500, WUTAI PRESBYTERIAN CHURCH

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PURPLE BUTTERFLY VALLEY IN MAOLIN

many of the tombstones in the adjacent graveyard. As the migrating butterfly flut-

SHENSHAN WATERFALL ters, it is little more than 20 kilometers from Wutai Presbyterian Church to boars or muntjacs by themselves had settlements is Shenshan, located on the Purple Butterfly Valley in Maolin. to stay within a specific patch of forest Highway 24. Shenshan means “Holy Driving from one location to the other where the right to trap and shoot had Mountain,” which is appropriate, takes over an hour, however, because been passed down from an ancestor. By because the village has a delightful and you need first to return to the lowlands custom, no hunting was allowed during unusual Christian place of worship. from one steep-sided valley before late spring and summer, when hoofed Like many buildings in the valley, the entering another drainage basin. animals breed, and when meat was exterior of Shenshan Roman Catholic Maolin is the site of the Rukai’s more likely to spoil. Church features a great deal of locally annual Black Rice Festival, usually held One ancient custom that has seen sourced slate. However, it is the interior in July. Through this colorful event, the a minor revival in recent years is hand that enraptures travelers. Rather than tribe expresses its gratitude for boun- tattooing. In the past, girls between conventional pews, worshippers sit on tiful harvests, and asks the gods to the ages of 12 and 16 had their wooden chairs, each one carved from a provide adequate rains throughout the hands tattooed as a rite of passage, section of trunk to resemble a tribesman year. Maolin also has one of Taiwan’s the tattoos signifying status, purity, in traditional garb. most remarkable ecological attrac- and beauty. When it became obvi- Last year saw the opening of a new tions. Thanks to its mild climate, the ous that this facet of tribal culture 1,000-meter-long trail to one of the valley is the main wintering ground of would disappear with the passing of area’s natural attractions. The beauty of Purple Crow butterflies. They gather in the final few tattoo-wearing Rukai Shenshan Waterfall and its cyan pools is vast numbers, creating a lepidopteran ladies — all born before World War II now accessible to anyone with healthy phenomenon on a par with Mexico’s — a cultural activist decided to get her legs and decent footwear. Monarch butterflies. hands tattooed. As in the days of yore, The village from which Wutai Town- The Purple Butterfly Valley is best a thorn mounted on a piece of bamboo ship takes its name is a few kilometers visited between November and March. was used to embed charcoal-based deeper into the mountains. On the slate- To make butterfly-watching easier, pigments into the skin. roofed abodes here, certain emblems the local government has marked out The lily is a recurring motif in both appear again and again: white lilies, a butterfly walkway and an ecologi- Rukai and Paiwan communities. When mountain boars, hundred-pacer snakes, cal park. Fortunate visitors may see a worn by a woman, this white flower and crucifixes. “butterfly waterfall” as hundreds of symbolizes beauty and virtue. On a Few Han Taiwanese are Christian, thousands of these beautiful insects man, it testifies to his courage and but the majority of their indigenous glide down a hillside. hunting skill. compatriots attend Protestant or Cath- To find out more about Maolin, Like many place names in Taiwan, olic churches. Wutai’s Presbyterian Wutai, and the surrounding region, visit Wutai is derived from an indige- Church is another striking expression the website of Maolin National Scenic nous place name, in this case Vudai. of indigenous religiosity. The impos- Area Administration (www.maolin-nsa. The Chinese characters used to write ing crucifix behind the altar consists of gov.tw). For additional information it are apt. They mean “Fog Plateau,” two varnished logs. The altar itself was about visiting Taiwan, please contact and visitors should expect sudden yet shaped from a knot of tree roots. The the tourism hotline at 0800- 011-765, bewitching mists. Bibles on the shelves are in romanized or go to the Tourism Bureau’s website One of Wutai’s more significant Rukai, and the same script appears on (www.taiwan.net.tw).

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