Looking South Episode #33 – Think Tank Exchanges

In this week’s installment of Looking South, Eric Gau speaks with TIER‘s Southern Taiwan Program Office Director Jason Kao to talk about exchanges between thinktanks under the New Southbound Policy.

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Transcript:

Eric Gau: Good morning everyone, and welcome to Looking South, here on ICRT. I’m your host, Eric Gau, and we are taking another look at the Taiwan government’s New Southbound Policy. Today, we are joined by Jason Kao, director of the Southern Taiwan Program Office under the Taiwan Institute of Economic Research. Director Kao, welcome to the show.

Jason Kao: Hi, hello everyone, I’m Jason Kao, and I’m from TIER.

Eric: Director Kao, what have think tanks such as TIER been doing to help the government carry out the New Southbound Policy?

Jason: There is one aspect that thinktanks like us, the Taiwan Institute of Economic Research, does, we help the government to devise the policy and to implement the policy. As you all know, the New Southbound Policy is a very important policy for President Tsai’s regime. This is quite different from before. Under President Lee, we had a Southbound Policy, and at that time, we focused on economics only, we go there and we set up factories. But for this New Southbound Policy, it’s more people-centric. What do I mean by ‘people centric?’ It’s not only about economic cooperation, but also about cultural exchanges and academic exchanges.

Eric: What has TIER learned through these exchange programs and interaction and things like that?

Jason: We’ve learned a lot. Not only TIER, but also CIER and all the thinktanks and all the academics learned a lot because it takes time for things to happen. It takes patience and understanding for the people from Southeast Asia. What we learned is that we don’t force our own values or our own beliefs on different cultures. What I’m saying is that people exchanges are the key; you have to talk and have to sit down and understand each other in order to make things happen. It’s not only about, ‘Oh, we’re going to talk about this and it’s going to happen tomorrow,” or “We think this is good for you, so you have to do this.” It doesn’t work that way.

Eric: So you’re saying it’s not a one-way street, we do not go there and just say ‘this is how things should be done’, and they listen. No, it has to be a bilateral, two-way exchange.

Jason: Yeah, that’s a good point, it’s bilateral. Actually, it’s not just bilateral, it’s multilateral. People often ask how the New Southbound Policy is different from others. We are not trying to force you to accept our own values; we have to learn from each other and from cultural differences. I learned from my great grandparents or grandparents, about 80 or 100 years ago, Taiwan had very close ties with Southeast Asia. And were just severed during World War II or Vietnam War or other international conflicts. I think people between Taiwan and Southeast Asia are still linked together.

Eric: Going back to what we were talking about before, but sort of on a wider scale, how do such think tank exchanges that TIER and others have been doing, how do these help foster bilateral ties and understanding?

Jason: As I just said, economic cooperation is important, but not only that, cultural, environmental, and social issues are also important as well. I think the cooperation is not only at the central government level. What I’m talking about is that maybe city-level cooperation can be fostered. For example, as we made Kaohsiung the base of the New Southbound Policy, the Kaohsiung city government has made a lot of effort to reach out to cities in Southeast Asia. To be concise, actually think tanks helped to set up the linkage between city governments and city in Southeast Asian countries. I think the central government put some efforts, but majorly we got some funding and we go there and build bridges between people and city governments.

Eric: On that note, we will be talking with the Kaohsiung city government in a future episode of Looking South. Director Kao, have there been any noteworthy breakthroughs or developments that have come about through such exchanges?

Jason: Except for student exchanges and academic exchanges, I see many exchanges happening right now. For example, medical exchanges. There is an organization called Boundless Doctors. A lot of those doctors are from Taiwan, and they volunteer to go to Southeast Asian, to the underdeveloped countries, to treat the patients over there, because they don’t have the medical resources and they don’t have the infrastructure. I think this is a good thing.  And not only about medical exchanges. I heard many medical students come here to Taiwan to receive their medical training, not only doctors but also nurses. That’s one thing. Also recycling; as you know Tzu Chi has done a great job in setting up recycling stations in Southeast Asia, and they have a good model on how to recycle the PP bottles or recycle other things and turn them to a better use. That’s one thing. The third thing, the Kaohsiung city government is helping some other cities to build up a cooperation network to fight dengue fever. Kaohsiung city government has a lot of experience in doing that for dengue fever. And also infrastructure, sewage, and flooding control. They have a lot of experience, and I think it’s very good that the city level can work with each other.

Eric: We’ve been talking about how these exchanges have been benefitting other countries, but what sort of benefits do you see such exchanges bringing to Taiwan, how does it help its people here, and its economy move forward?

Jason: My expertise, I’m focusing on inbound. What I mean by inbound, for example, we do a lot of start-up pitches, start-up shows, with our counterparts in Southeast Asia. And through those, we learn about a lot of Southeast Asia young people, young talent. And we see their talent and I think we can work with them to help them to develop their own economy and also we wish that they can come to work in Taiwan or be partners with Taiwan. And that’s why in the past few months the Taiwanese government has changed the regulations so we opened up so that young talent to come work for Taiwan. Especially in the Small and Medium Enterprises Administration of the MOEA. They set up a ‘start-up visa’, that means that young people who have a start-up in Southeast Asia can apply for the start-up visa and come set up a company in Taiwan really quick. I think Taiwan has a lot to contribute and a lot to learn from Southeast Asian countries. It’s a great market, and Taiwan has to immerse ourselves in the diversified cultures in order to be part of the big family of Asians and be a part of the market.

Eric: We’ve been speaking with Director Jason Kao from TIER’s Southern Taiwan Program Office. Mr. Kao, it’s been a pleasure having you join us on the air today.

Jason: Thank you very much.

Eric: And that wraps up today’s installment of Looking South, here on ICRT. Thank you for tuning in, and we’ll be back again next week with a fresh look at the New Southbound Policy. I’m Eric Gau.

 

Looking South Episode #32 – The Taiwan-ASEAN and India Strategic Investment Partnership Forum

In this week’s episode of Looking South, Eric Gau discusses the Taiwan-ASEAN and India Strategic Investment Partnership Forum with Department of Investment Services Director-general Emile MP Chang.

Eric Gau and DIS Director-general Emile Chang

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Transcript:

Eric Gau: Hello and welcome to another episode of Looking South, exclusively on ICRT. I’m your host, Eric Gau, and today we are discussing investment forums held by the Ministry of Economic Affairs with Department of Investment Services Director-general, Emile MP Chang. Mr. Chang, welcome to the program.

Emile MP Chang: Good morning Eric, good morning everyone.

Eric: The Ministry of Economic Affairs is going to be holding the “Taiwan-ASEAN and India Strategic Investment Partnership Forum” next week, on July 17th and the 18th. Could you tell us why the Ministry has organized this Forum, and what its purpose is?

Emile: Since September 2016, we have promoted the New Southbound Policy, that has four main aspects: economic cooperation, talent exchange, resource sharing and regional links. We continue to promote many programs in areas such as investment, trade, and industrial cooperation. Since the ASEAN countries have 650 million people, just second to China and India, the ASEAN countries also have total GDP of US$2.5 trillion, making it the world’s sixth-largest economy.

Eric: You mentioned that this forum has been held annually since 2016. Can you tell us what the two previous forums accomplished, and how this year’s forum is different from the ones that came before it?

Emile: In the 2016 forum, we invited the chief operating officer of the economic research institute for ASEAN and East Asia to attend, as well as investment officials from several ASEAN countries, including Indonesia, the Philippines, Thailand, and Malaysia. The Forum included many presentations and discussions, and there are more than 600 people who attended this forum in 2016, it was very successful. In the 2017 forum, we saw even greater participation, including more people from ASEAN countries, and also from the other special countries, like people from Laos. In the 2018 Forum, the key feature of this year is that we have included another country, India. India is attending this forum for the first time, so this year has that special aspect. Since India has the world’s second-largest population at 1.3 billion people, we hope through this direct introduction exchange with India we can build up a close link with India.

Eric: Mr. Chang, what is the current situation regarding bilateral investments between Taiwan and the New Southbound Policy target countries?  And aside from this annual investment forum, what other measures are in place to help enterprises invest there?

Emile: According to the data from the MOEA’s Investment Commission, in 2017, inbound FDI from these 18 New Southbound Policy countries has increased more than 15% over the previous year. And also the southbound investment from Taiwanese companies to these countries has increased more than 54% from the previous year. We have continued to promote a variety of different measures, such as investment, trade, and industrial cooperation, to help enterprises to cooperate with those enterprises in these countries. In investment, we have built a Taiwan Desk in six countries, like Vietnam, Indonesia, Thailand, the Philippines, Myanmar, and India. We provide many Taiwanese businessmen with professional consultations to facilitate their investment projects. In terms of industrial cooperation, we have established an Asia-Pacific industrial supply chain partnership, and this year we specially selected Indonesia, Thailand, the Philippines, Malaysia, Vietnam, and India to join the partnership. On the trade side, the Bureau of Foreign Trade has set up Taiwanese Excellence pavilions at many important exhibitions in ASEAN countries.

Eric: And finally, before we go, what advice or opinions do you have for companies that are looking to enter the ASEAN or Indian markets?

Emile: Since the ASEAN and Indian markets have an average GDP growth of more than 5%, especially India, where it might achieve more than 7%, so I think it is an emerging market for Taiwanese companies. So we advise our enterprises to seek this market, and we do everything we can to help them. In addition, to get this opportunity, we also want to remind our enterprises that they have to consider if there is any risk or any situation they have to consider. But we are going to provide some measures to help them.

Eric: Could you give us any specific examples of the measures you mentioned earlier?

Emile: We encourage everyone to take part in the Taiwan, ASEAN and India Strategic Partnership Forum, held in Taipei on July 17th and in Taichung on July 18th. In this event, we will help every participant with very good opportunities to learn and make new contacts with people in these markets.

Eric: We’ve been speaking with Emile Chang, the director-general of the MOEA’s Investment Services Department. Mr. Chang, thank you again for taking the time to speak with us.

Emile: Thank you Eric, thank you everyone.

Eric: That’s it for today’s episode of Looking South. Tune in again next Monday for another look at the New Southbound Policy here on ICRT. For this and past episodes of the program, you can go to the ICRT Web page and find the audio under the Podcast section. I’m Eric Gau, thanks for listening.

Looking South Episode #31 – Business Exchanges

Launching a new season of Looking South, Eric Gau is once again joined by Simon Wang, executive vice president of TAITRA. This time, the two discuss business exchanges between Taiwan and New Southbound Policy Target Countries.

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Transcript:

Eric Gau: Hello everyone, and welcome back to Looking South, ICRT’s program dedicated to exploring the government’s New Southbound Policy and its effects both at home and abroad. Today, we’ll be looking at business exchanges conducted under the Policy. To tell us about that, we are rejoined by longtime friend of the program, Taiwan External Trade and Development Council Executive Vice President, Mr. Simon Wang. Mr. Wang, welcome back to the program.

Simon Wang: Thank you, Eric. Thanks for having me.

Eric: To start us off, why don’t you tell us the role that TAITRA has been playing under the government’s New Southbound Policy.

Simon: Yes, we play the role of ‘eyes and ears’ for companies. For example, we help collect market information, including target nations’ policies, rules and regulations, city information geographic-wise, and industry information, and even consumer behavior. And also cultural differences. And then we help watch where exists market opportunities, doing market surveys, big data analysis, and we also have a couple of offices in New Southbound countries, 12 offices. These offices also play the role of ‘eyes and ears’.

Eric: How has TAITRA been fostering business exchanges between Taiwanese companies and their counterparts in these target countries?

Simon: We can look at this issue from two sides. One is inbound; we invite target audience, either buyers or sellers or companies that would like to partner with Taiwan, to come to Taiwan to seek for business opportunities, or we will help to arrange for site visits and to have one-on-one business meetings. We have a lot of projects like Southeast Asia Business Day, South Asia Business Day, these kinds of projects. And also industry cooperation is also what we would like to focus on. Taiwan has very well-founded industry clusters, such as machine tools in Taichung, plastic industry in Tainan, ICT in Hsinchu. We organize around 40 Taiwan International Trade Shows, and some of those trade shows are internationally known and also are good platforms for New Southbound countries’ companies who would like to seek cooperation can visit or to join to exhibit their products in ICT trade fairs like COMPUTEX and the Food Show, which is also very popular, and the Bicycle Show and so forth. That’s one side. Another aspect is the outbound side, like we organize the Taiwan Expo in Vietnam, in Indonesia, in Thailand, in Southeast Asian nations. We also have projects called image enhancement projects which is to help communicate how Taiwan will be perceived in the eyes of the target audience. We also have consultation services and Taiwan products promotion center, which helps companies tailor-make their products’ promotion projects, to even employ sales rep for them in the target country. Another aspect is on the virtual side, not in the so-called ‘brick and mortar’ field. The virtual side is e-commerce. We help companies enter into the market by way of e-commerce platforms, such as in Indonesia, we have entered into alliance with Blibli, in Vietnam Tiki, in India Trade India. These kind of electronic commerce platforms, the companies can utilize the platforms to market their products.

Eric: Mr. Wang, could you give us any examples of cooperation that you feel have been exceptionally successful since the Policy was put in place?

Simon: Yes, TAITRA has put a lot of effort in helping countries explore opportunities in India. One of the very good examples is that we helped CTCI, a leader in engineering services from Taiwan, obtain a project of $240 million US dollars. The project was about building a natural gas receiving station. This is a very good, flagship example. Another example is we helped Taiwan Beer, and another well-known brand of whiskey, called Kavalan, enter into Vietnam and Cambodia market. In Vietnam, if we export beer from Taiwan to Vietnam, the tariff will be 35%. So we helped them to enter into the market in another way, which is to find a subcontractor to manufacture beer in Vietnam, that would cost less than half of the price. So this is a very successful case. We organize other image fairs, Taiwan expo, and another very good outcome is we organize Taiwan Expo, and then we get Indonesia or Myanmar to have their solo show in Taiwan in return. I think this is a very good outcome that is a kind of two-way communication, instead of only unilaterally one-way, from Taiwan to the New Southbound countries.

Eric: What can other companies learn from these examples about how to work with firms from neighboring countries effectively?

Simon: I think for our companies who haven’t been able to enter into the market, what we can learn is that we have to be humble, to learn to have the mindset of humbleness. New Southbound Countries include 18 countries, that can be split into 3 parts: Southeast Asia, South Asia, and more developed countries like Australia and New Zealand. And in Southeast Asia you can also divide into three parts: first tier is Singapore and Brunei, and then second Thailand and Malaysia, and thirdly is what we call CLMV, by their economic development. They constitute very different economies, not to mention their religion, language, different markets, different cultures, different consumer behaviors. We have to be very humble and not to take them as a whole. We have to understand deeper what they represent. Number two is we have to know that netizens nowadays are getting more and more important. Netizens have a size of about 260 million in Southeast Asia, and according to the World Bank, the monthly increase is 3.8 million netizens. But even with such a rapid development, but the penetration rate is less than 16 percent. And electronic commerce accounts for total retail sales’ merely 1% to 5%. Do you know what the percentage is in Taiwan? 17%. It means that the room for growth is very huge. Number three is that we need to have the idea of ‘grow together’. The mindset of ‘together’ that is very important to pursue the better life, we have to grow together which means we need to foster business interchanges that are two-way, instead of only to sell. That’s what we need to learn.

Eric: Mr. Wang, before we go, what will TAITRA be doing in the future to further spur business exchanges? How will its efforts expand or adapt from what you’re doing now?

Simon: I think we, in the future, what we need to adapt is a couple of aspects. Number one is we need to do it in-depth. Now, the spectrum is wide. Next, I think to do it deeper, in-depth, more focused. For now, we organize our Taiwan Expos in capital cities. In the future, probably we could go to second tier, third tier cities. To tailor-make our promotional projects, to meet the needs of our target countries. And second is we should probably think about some sort of flagship projects, like petrochemical projects we are working on. And thirdly is, I mentioned earlier, we need to do something more bilateral, projects or any kind of arrangement. So two-way communication is what we need to do more of in the future. We have to make use of Taiwan’s soft power, such as the agricultural industry, education, and medical care, is very important for Taiwan to have some kind of business exchanges with our target countries.

Eric: We’ve been chatting with Simon Wang, TAITRA executive vice president. Mr. Wang, thank you again for joining us here on ICRT.

Simon: Again, thank you, Eric.

Eric: And that wraps up this episode of Looking South. Join us again next Monday for the next installment, or head over to the ICRT web page for past episodes. I’m Eric Gau, and thank you all for tuning in.