Country Background
- GDP (2010): $430 billion.
- Real annual growth rate (2010): 10.88%.
- Per capita GDP (2010): $18,588.
- Unemployment (April 2011): 4.29%.
- Natural resources: Small deposits of coal, natural gas, limestone, marble, and asbestos.
- Agriculture (1.6% of GDP): Major products--pork, rice, fruit and vegetables, flowers, sugarcane, poultry, shrimp, eel.
- Services: (67.1% of GDP).
- Industry (31.3% of GDP): Types--electronics and flat panel products, chemicals and petrochemicals, basic metals, machinery, textiles, transport equipment, plastics, machinery.
- Trade (2010):
- Exports--$274.6 billion: electronics, optical and precision instruments, information and communications products, textile products, basic metals, plastic and rubber products.
- Major markets--P.R.C. and Hong Kong $114.8 billion, U.S. $31.5 billion, Japan $14.5 billion.
- Imports--$251.4 billion: electronics, optical and precision instruments, information and communications products, machinery and electrical products, chemicals, basic metals, transport equipment, crude oil.
- Major suppliers--Japan $36.2 billion, P.R.C. and Hong Kong $37.6 billion, U.S. $25.4 billion.
Main Challenges
- Taiwan has already lost the comparative advantage of inexpensive labor. Henceforth, it will have to rely on the continuous improvement of technology, skills, and techniques in order to win the competition.
- The development of the agricultural sector has already encountered trouble from both within and without.
- The percentage of economically productive people in Taiwan is slowly decreasing, and eventually Taiwan will face a situation where a majority of dependent people rely on a minority of productive people.
Major Opportunities
- There are a multitude of trade and investment opportunities for exporters in the Taiwan market.
- Some of the major sectors currently experiencing rapid growth are: processed food and beverages, gambling, transport, IT and telecommunications, minerals and energy, environment protection, building construction products and services.
- Three of the major growth industries though are the exporting of seafood, meet and wine products.
Doing Business in Taiwan
- The basis for doing business in Taiwan is respect and trust. You need time to establish relations. Although the country is westernised, the traditional Asian spirit survives.
- Taiwanese executives have the greatest international experience in all Asia. The country’s insularity and political difficulties with China have forced them to look for markets for their products all over the world.
- For the Taiwanese, age and professional status are very important. Older executives are held in higher esteem. They believe that a foreign company that sends a senior executive to Taiwan has a real interest in doing business.
Using an agent/distributor
- Finding distributors, agents and local representation are an important part of an export strategy for Taiwan.
- The business environment in Taiwan is very different from other Western markets. Therefore, foreign companies need strong in-market representation to enable them to understand the idiosyncrasies of the market, marketing and distribution channels, buyer identification, product support and relationships with key government agencies in the market.
Establishing an office
- Foreign investors usually establish the following forms of business entity for the purpose of carrying out business in Taiwan:
- A corporation, which may either be a company limited by shares or a limited Liability company; or
- A branch office. Such as trading, sales, agency, marketing and consulting services.
- The prohibited industries:
- may negatively affect national security, public order, good custom, or national health and
- are prohibited by laws and regulations.
Selling to the government
The Centers can help businesses:
- Acquire necessary registration with various government agencies.
- Develop a marketing plan that identifies government agencies that buy small business products and/or services.
- Identify sub-contracting opportunities that increase small business activity.
- Understand and utilize Electronic Data Interchange (EDI) and Value Added Networks (VANS) that access government contracting information.
- Understand contract and referral services, as well as basic contracting fundamentals.
- Utilize and better understand the benefits of electronic commerce procurement business practices.
- Utilize a variety of reference and resource materials.
Distribution & sales channels
- Herbal/traditional products are sold at chemists/pharmacies, parapharmacies/drugstores and through direct sellers.
- Direct selling is expected to decline unless agents stock new star products that will arouse consumer interest.
- Retailers and manufacturers will invest more money in advertising in health magazines or on health-focused websites.
Electronic commerce
- E-commerce has become a global trend, and its development has begun to correlate to a country’s competitiveness.
- Although, similar to most parts of the world, e-commerce in Taiwan had faced the following challenges at that time:
- Maintaining the e-commerce system (software, hardware and infrastructure).
- Staying up-to-date with constant evolution of Internet technologies.
- Integration with financial / payment services.
- Integration with other services such as logistics.
Openness to foreign investment
- Strategically located in the center of the East Asian market, Taiwan continues to attract significant foreign direct investment.
Right to private ownership & establishment
- Private investors have the right to establish and own business enterprises, except in a limited number of industries involving national security and environmental protection.
- Private entities can freely acquire and dispose of interests in business enterprises.
- Private firms have the same access as state-owned companies to markets, credit, licenses, and supplies.
- Taiwan authorities have eliminated most state-owned monopolies, with the exception of some companies in the health insurance, financial, and power and water utility sectors.
Business customs
- Business cards
- exchanging business cards is very important in Taiwan, so you should have a large supply at all times as several hundred may be required for a short trip.
- Correspondence
- answer enquiries, proposals, correspondence and invitations as soon as possible, and at the very least, send an acknowledgment stating that an answer will follow shortly.
- Punctuality
- while traffic conditions in Taipei can cause delays, Taiwanese place importance on punctuality and you should avoid arriving late at appointments.
- Gifts
- the exchange of gifts is widely practiced in business in Taiwan and gift-giving usually occurs at the end of a meeting or during a meal in honour of your guests. Usually only small gifts are necessary but sometimes gifts offered by the Chinese are quite lavish
- beware that a special favour may be expected in return.
Local time, business hours, & holidays
- Business hour:
- Holiday:
Fact Facts
Population
|
23,061,689
|
Capital
|
Taipei City
|
Area
|
36,008 km2
|
Ethnic groups
|
98% Han
70% Hoklo
14% Hakka
14% Waishengren
2% Taiwanese aborigines |
religious
|
93% ancient Chinese religion: Buddhism, Confucianism, and Taoism
4.5% are adherents of Christianity, which includes Protestants, Catholics, and other
2.5% are adherents of other religions, such as Islam
|
major language
|
Mandarin (official language)
70% Taiwanese (a variant of Min Nan) - mother tongue
15% Hakka language |
monetary unit
|
new Taiwan dollar ( NT $)
|
major industries
|
electronics,
petroleum refining, armaments, chemicals, textiles, iron and steel, machinery, cement, food processing, vehicles, consumer products, pharmaceuticals. |
major export
|
Electronics,
flat panels, machinery; metals; textiles, plastics, chemicals; optical, photographic, measuring, and medical instruments |
major imports
|
Electronics,
machinery, crude petroleum, precision instruments, organic chemicals, metals |
GDP
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USD$423.0 billion
|
GDP per capita
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USD$16.372
|
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