According to a report on the Nikkei Asia website on Saturday, a recent survey revealed that Taiwanese businesses operating in China are rapidly shifting to Southeast Asia or to Taiwan, a trend that matches the foreign policy of Taiwan President Tsai Ing-wen. About 500 Taiwanese businesses that operate in China were included in the investigation, which was conducted by the CSIS, a US-based organisation.
7% of them have already moved some of their supplies or manufacturing outside of China, and a third are thinking about doing the same. The study’s findings showed that the majority of The majority of Taiwanese businesses that left China—63.1% of them—went to operate in Southeast Asian nations, however some of them relocated to Taiwan.
There is little doubt that the new strategy to travel south is timely, given the cost and confidence concerns for doing business in China, according to Chen Kwan Ting, CEO of the “Taiwan NextGen Foundation,” a foundation situated in the Taiwanese capital Taipei.
The New Southern Policy, which was introduced by Taiwan’s president in 2016 and refers to Taiwan’s access to its neighbours and partners in South Asia as well as its diversification away from the Chinese market, is a strategy that prioritises trade, investment, and popular relations between Taiwan and nations in Southeast Asia, South Asia, and beyond.
When it comes to Taiwan’s strategy, Ting said, “The New Southern Policy programme is a strategic shift as Taiwanese investors strive to promote the economic development of Southeast Asian countries.”
Speaking at the Yushan Forum on Friday, the president of Taiwan emphasised how rapidly Taiwanese businesses have increased their investment in Southeast Asia, noting that from January to July, Taiwan’s investment in South and Southeast Asian countries (18 countries) exceeded 2. 2 billion, accounting for 43.
9% of all foreign investments made by Taiwan.
The survey’s findings revealed that Taiwanese businesses are extremely concerned about their country’s excessive reliance on China’s economy and the dangers of a military war, and 76.3% of the businesses polled agreed that Taiwan needed to lessen its reliance on China economically.
According to the study’s findings, there is strong support for fostering closer ties in the areas of trade and investment through regional agreements as well as bilateral agreements with the United States of America. Support is also strong for maintaining Taiwan’s technological edge by boosting spending on R&D and tightening restrictions on technology transfer to China.
A crucial point was made in the research, namely that Taiwanese businesses are not just leaving China but also expanding outside of Taiwan. According to the survey, 13% of Taiwanese businesses with operations in China said they had already relocated some of their operations outside Taiwan, and another 20% said they were thinking about doing the same. Of those who would relocate outside Taiwan, 67% said they would be going to Southeast Asia.
Before Nancy Pelosi, the speaker of the US House, travelled to Taiwan, a poll was taken in late July. The Center for Strategic and International Studies came to the conclusion that China must address this trust problem and that Taiwan must strike a balance between diversifying away from China and preserving continued, advantageous economic ties.
The US think group stated that Taiwan needs to give more support to areas like energy, education, research and development, and other areas so that Taiwanese businesses may continue to compete globally.
Chinese firms that are from Taiwan depart towards Southeast Asia.
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