Summary of Taiwan Industries

[b]Hospital Supplies, Medical Supplies, and Equipment[/b]
$y!}4w g1|2X#W Taiwan occupies a unique position in numerous professional fields as a pioneer of new products, manufacturer of economical yet quality goods, a synthesizer of technologies, and innovator in production processes and applications. These advantages are found throughout the medical field, where Taiwan contributes to the development of new diagnostic methods, treatments, and the application of breakthrough technologies to new products that make healthcare safer and more cost-effective.
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Taiwan-made products enjoy a particularly strong buyer following in items that draw on Taiwan's IT strengths and strong medical heritage -- such products as a negative ion mask that incorporates nano-technology, plus arrhythmia detection and blood pressure monitor devices. Other recent breakthrough concepts range from healthcare products made with infrared rays and chitosan, to personalized health evaluation systems with gene checks, bio-energy chairs, daily healthcare products, and anti-bacteria products.9_P&gr"x }

.sD m Ck{2}&_ Taiwan is where leading biotech companies underscore the tremendous possibilities and growing importance at the forefront of medicine. Opportunities abound when bringing together medical professionals from across Taiwan and around the world, combined with the best suppliers of medical materials, equipment, technology, and services. This is the place to purchase dental equipment and appliances, mobile scooters, laser surgical equipment, diagnostic reagents, hospital equipment, and disposable items such as gauze and gloves.
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Taiwan's efforts to develop research, development, and production capabilities in the biotech sector have created a wealth of investment opportunities. Biotech research at Taiwan's top academic institutions is receiving increased international attention. At the same time, development capabilities, fostered through joint industry and government support, are turning these research achievements into commercially viable products. The government plans to promote the industry including such targets as US$4.34 billion worth of investment, and 25 percent annual revenue growth by 2008, and the existence of 500 biotech-related companies within 10 year S%Z'a'B3?v
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As technologies converge to take medicine and hospital supplies into new territory, the latest R &D achievements in diagnostic devices include bulk drugs, bio-chips, negative-pressure isolation rooms, and an anti-mold series. The biggest export item remains motorized patient vehicles, with disposable plastic examination gloves and physiotherapy massagers coming in second and third. The top-ten medical device export items command 70 percent of the total export value. With the graying population on the increase worldwide and the corresponding rise in social-welfare spending by various countries, the demand for medical equipment and hospital supplies continues to climb yearly.

Biotechnology

Taiwan's biotechnology industry has been growing at a fast pace with the addition of 20 biotech companies each year since 1990. In 2000, the Taiwan government began to encourage and strongly support the industry, resulting in a dramatic increase of up to 40 start-up biotech companies a year -- and the momentum is still going strong.J7Q OR,O e!c

k kIW\N6?/tO There are approximately 300 biotech companies incorporated in Taiwan (excluding chemical and Chinese drug companies), covering the sectors of biomedicine (including regenerative medicines and biomedical materials), medical diagnosis, specialty biotechnology, food biotechnology, agricultural biotechnology, environmental biotechnology, and biotechnology/pharmaceutical services.
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uTZY#m?#gI Source: ITIS Program, DCB, December 2005.
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JZMI{&B\)O2C3Kf] Taiwan biotech specializes in delivering low cost medical solutions. The pharmaceuticals industry concentrates on producing quality generic medicines, the biotech industry on developing new medicines, and the medical device industry on adding value to existing and new products.
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In the sector of active pharmaceutical ingredients (APIs), Taiwan has been able to successfully apply its made-to-order process of manufacturing ingredients that combine to create pharmaceutical drugs. APIs allow for lower input and production costs, freeing up company resources to concentrate development of specific ingredients, thereby improving production processes. Taiwan's API prowess has led an exodus of multinational drug manufacturers to acquire from Taiwan the materials necessary to create new and improved pharmaceutical drugs.
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l Ej3M `F Average paid up capital for Biotechnology Company in Taiwan is only NT$ 290 million. pVw7~n
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Source: ITIS Program, DCB, December 2005.
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The Taiwan government's ambitious plan to infuse the local biotech industry with US$667 million up until 2009 has proven to be successful. In addition to the growing number of biotech companies, Taiwan's research expenditures rose to 3% of the GDP, on level with both Japan and South Korea. This highlights Taiwan's dedication to medical technology research with a growing number of world-class research facilities, targeting development of nano-biomaterials, miniaturized biomedical & therapeutic systems, and optoelectronics modules and sensors.u4bY1E[d_1a(|3^

`?I'x)|^na Investment in Taiwan's biotech/pharmaceutical industries has been steadily increasing, as has research and development funding. The majority of core technology has so far been developed internally, however joint ventures, technology transfers, and other resources are forecasted to change the percentages toward external sources. 3q"w*?$ys4y4f_
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Source: ITIS Program, DCB, December 2005.
!US4h]M[,Fu;wh1IS Figure 16-7??Distributions of R&D Investment in Taiwan's Biotechnology Industry
f7T#i!m~P]S7x1|]1n)|9@ The prospects for Taiwan's biotech industry are phenomenal. Its strategic location in the Asia Pacific was part of the reason why more than 65 percent of Taiwan's export medical devices went to China. In addition, trade links have long been established with Japan, Korea, and throughout Southeast Asia.
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a:\] sH#^"HBm Most Taiwan biotech companies are very positive about their industry's future, predicting a total average output growth rate of 16% for the next three years. 93% of the companies surveyed expect the rate to grow 18%, whereas only 6% of the companies were pessimistic, estimating a negative growth rate of 10%. n)G1G~"_!B
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Agriculture Products and Foods Industry

Located at the geographical and cultural crossroads of East and West, connoisseurs know Taiwan plays a vital and exciting role as hub and innovator in the foods industry, with the widest variety of scrumptious cuisines -- including the best in Chinese cuisine -- in the world. From ancient recipes to nouveau niches, nobody can touch the authenticity, flair, and novelty with which Taiwan cooks up new creations, with equal priority given to the highest standards of taste and food safety.
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Taiwan's incredible diversity of agricultural products owes much to its tropical climate, but its lack of arable land is largely translated into a dependency on imports, but this makes Taiwan's market increasingly profitable for foreign sellers and their wares. In 2004, agricultural imports amounted to US$8.86 billion, an increase of almost 14 percent over the previous year. Wheat, maize, and soybeans are Taiwan's most important cereal imports. In 2004, Taiwan imported US$1.81 billion worth of these grains, primarily from the US. Import prospects in dairy products are also promising; for instance, the demand for processed milk powder, liquid pure milk, flavored milk, and cheese has also been growing. In addition, both Chinese and other foreign markets lost market share as Taiwan Beer enjoyed a resurgence.
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3cvw@"t Q4kd;M Taiwan's food exports are also on the rise, with a production value of US$13.9 billion in 2004, a growth of 5.9 percent from the previous year. There are more than ten thousand companies in the Taiwan food products industry, often concentrated in central and southern Taiwan, where favorable weather, lower land costs and better access to raw materials give producers large advantages. Taiwan's exports of agricultural and food products in 2004 expanded by 9.8 percent to reach US$3.6 billion, with the bulk of items shipped to Japan, Hong Kong, and the US, together absorbing 66 percent of the island's total output. Shipments to Japan grew over 15 percent, and US demand grew nearly 11 percent. Other major destinations for locally grown produce and processed foods included China, whose import demand rose over 66 percent from 2003, Vietnam (up 24 percent), South Korea (up 22 percent), and Thailand (up 24 percent). The domestic aquaculture sector was the biggest dollar-earner in 2004, and totaled 43 percent of Taiwan's total agricultural export revenues.
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W eD? j_!o"_ l2N8`a Fierce competition in the global market has forced Taiwan producers upmarket, shifting their focus to higher value-added processed items, such as sashimi. Taiwan's shipment of fish products like tilapia and tuna to overseas markets last year increased to over half a million tons, while export value grew by 17.5 percent. Animal husbandry exports like cowhide and pig leather have shown great potential for growth, as well. Farm products, including high-grade tea, vegetables and fruit (especially mangos and bananas), and processed products, increased 9 percent year-on-year in 2004. Domestic forestry exports registered double-digit growth in terms of volume and value over the same period.
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"Pl@C eN)^.O Frozen foods continue to lead all other items in the Taiwan processed foods industry, controlling over 60 percent of production. Other locally processed items include seasoning, dehydrated and preserved foods, and confectionery. With the help of some sophisticated technology, Taiwan, which has served as an important center of rice cultivation for centuries, has recently been perfecting the production of O??mefun, pre-cooked rice that can be stored at room temperature for up to one year. p;~4n
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Several companies in the local food processing industry have successfully transformed their production and assembly lines to meet the strict criteria of Japan, raising Taiwan's QC image of the industry and gaining approval of international buyers. To meet domestic and foreign standards in food safety, qualified Taiwan food companies not only have a factory registration certificate from the government, but also obtain QC certifications, such as CAS, GMP, HACCP, EEC, FDA, ISO-9001, ISO-9002, and ISO-14001. Taiwan's food industry is implementing new approaches to maintain an edge in the industry, such as greater use of IT and strategic alliances to increase operational efficiency, creating higher value-added products, and adopting new business models. Taiwan producers have embraced IT as anotherway to increase competitiveness, investigating and implementing IT systems such as ERP (Enterprise Resource Planning), and CRM (Customer Relations Management), helping food companies shorten procurement cycles, increase inventory turnover, and efficiently manage customer relations.

Taiwan's Gifts, Stationery, & Novelties Industry

If you are wondering where the world's best quality gifts and stationery come from, look no further than Taiwan. Few countries come close to the sheer variety, personalization, value, and professionalism Taiwan offers for gift and stationery orders. While much has been written about Taiwan's famous and resilient high-tech industry, its gift product companies equally deliver quality goods worldwide.
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%i;\ x@0jD[ Taiwan's early giftware industry distinguished itself with ceramics from Yingge, bamboo goods from the Hsinchu area, and stone carvings from Hualien, while also achieving success with Christmas ornaments, artificial flowers, high-quality umbrellas, and numerous other giftware items. Today, if you take a look at your fancy new pen, chances are it came from a Taiwan-owned company. High-tech stationery items are also on offer here -- what else would you expect from a world leader in high-tech products? Masterful craftsmanship at reasonable prices and world-class standards with numerous innovative items and products featuring better designs, higher quality, trendier materials, and involving a creative combination of materials, such as wood and glass, metal and stone, and fine fabrics. Combined with new opportunities presented by home shopping and Internet commerce, Taiwan has consistently achieved inroads across the globe.
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\mWIsx3SaN#F V Whether looking for seasonal gifts, photo or museum-quality frames, candles, business gifts, craft supplies, environmentally-friendly products, goods based on licensed themes, and leisure- and health-related products, you'll find an excellent source in Taiwan. Taiwan's manufacturers have a knack not only for state-of-the-art injection molding, but also a diversity of natural and man-made fibers and craft supplies. And you can trust suppliers to produce what you need, according to your specifications and time frame.
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rf'W4B(NSc5D Taiwan's focus is now on providing a broader selection of items made available in smaller quantities, as well as design, innovation and management. This enables buyers to offer limited editions to their customers and a wider variety of goods from which to choose. Another trend is the incorporation of advanced technologies, such as integrated circuits (ICs) and non-polluting materials, producing creations that offer ingenious yet classic designs and an alternative to low-end generic novelties.P-YX({Y#_ }Nk
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From new nontoxic and non-odorous art and craft materials, magnetic sheets in a variety of color choices, styles, and functions to devices created to help relieve stress by stimulating sleep-related acupuncture points using electric impulses and DIY world maps constructed with puzzle pieces, firms making consumer and miscellaneous products have stepped up their efforts to develop world-class designs for the giftware and novelty market.P1Ae2dxn)an

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Taiwan's Textiles, Garments, and Accessories Industry

Textile manufacturing has long played an important role in Taiwan. Although ultimately replaced by the electronics sector as the island's leading export industry, Taiwan's more than 7,000 textile manufacturing concerns remain important contributors to foreign exchange earnings. In 2004, textile exports amounted to US$12.54 billion, or 7.2 percent of its total overseas sales.
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:Q!J'|5M6v Major textile export categories include fibers, yarns fabrics, apparel, and accessories, with yarns and fabrics dominating the field. Man-made fiber turned out in Taiwan includes polyester filament yarn, polyester staple fiber, nylon filament yarn, acrylic staple fiber, rayon filament yarn, and rayon staple fiber. Taiwan ranked second in the world in polyester fiber, whereas in production of nylon fiber Taiwan slipped to rank third. Woven man-made filament fabrics are of particular importance in terms of exports. Taiwan still ranks second in the world in production of chemical fiber, despite a 2.6 percent increase in production and a slight slowdown in market demand after 1999.Qf(LRHd_s{X
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2004 has been an important and pivotal year for the global textile and garment industries. Before the removal of quotas in 2005, every country and region had experienced pressure from increasing oil and raw material prices, the expansion of the European Union, the strong Euro, and fierce competition from China. Most consider that the cancellation of the quota system will positively influence the Taiwan textile industry, and give the garment industry more flexibility and room to move. However, the chain of supply is expected to be significantly affected by Chinese purchasing power. Eventually, the two ends of the supply chain may threaten mid-stream industries such as Taiwan's weaving and dyeing-and-finishing, and make the race more competitive in the world market. Nevertheless, Taiwan's textile-related industries possess a complete supply chain and consequent price advantage, making Taiwan exports very competitive.4_0X/DKx8h.L

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m.u!y$JG In response to changing domestic and international economic and business conditions, Taiwan's textile manufacturers are placing more emphasis on R&D. They are focusing on turning out more innovative products and improving their design and marketing capabilities. With higher value-added products, manufacturers hope to upgrade their production operations and enhance competitiveness. In this effort, the industry is capitalizing on its system of highly integrated production that includes up-, middle-, and down-stream manufacturers, as well as on its many years of experience and expertise.
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Taiwan's garment and clothing accessory imports fall into two major categories: high-end name-brand products from Japan, Italy, and France and low-priced garments from developing countries located in such areas as Southeast Asia. Many importers have in recent years obtained agency agreements from world-famous brands, with leading foreign companies seeking to share in the Taiwan market.
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Some manufacturers have already formed cooperative alliances to develop high-end products more quickly and efficiently. Such products include infrared ray-resistant, fire-proof, electromagnetic wave-resistant, anti-bacterial, cut-resistant, breathable, stretchable, static-proof, abrasion-resistant, air-purifying, fragrant, and polyester hollow micro porous items, as well as fabrics containing metal fiber. These products, which are made into everything from waterproof and quick-drying jackets and moisture-wicking underwear to hygienic surgical gowns and ultraviolet-proof cloth, are helping Taiwan maintain its competitive edge in global markets.
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Taiwan's Electronic Components & Parts Industry

Led by the global communications market, Taiwan's economy has been steadily recovering since 2003 setbacks with an increasingly strong demand for electronic components. Taiwan??s ICT products have top rankings in the world market; first ranked products in 2004 included: notebook PCs, motherboards, LCD monitors, CDT monitors, projectors, PDA, and several data communication products such as switches, routers, cable modems, DSL CPE, and wireless local area networks (WLAN).
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Taiwan makers?? profit margins have fallen due to leading vendors continuing to bargain hard on prices for contract manufacturing orders, fierce competition from Korea and China, and a low pricing trend. For cost and logistical efficiency, Taiwan has also shifted a majority of its production locations to China. But Taiwan companies have successfully managed to combat this situation by reducing materials, production, and management costs and by entering the China market. As a result, during 2005 combined shipments for 14 major product categories by the Taiwanese industry grew by more than 15 percent to over US$70 billion. Notebook PC and LCD monitors are two major growth engines behind the strong increase, while data communication products such as Wireless LAN, VolP and DSL are also growing robustly.
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*kY:lz{8z Taiwan??s electronic component market as a whole grew rapidly by 5 percent in 2004, reaching US$16.5 billion, a 20 percent growth over 2003. This trend is expected to continue as domestic manufacturers keep expanding their international presence in the handset and consumer electronic components markets. The growth is driven by a healthy demand for high-end NB and handset components and strong growth in the production value of flexible PCB, BGA/flip chip substrate, and battery packs.0Lp)B1aJ
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In 2004, the Taiwanese electronic component market enjoyed rapid and recently unprecedented growth. However, growth areas in the electronic components industry may be offset by an oversupply in PCs and handsets, plus decreases in electronic component ASP. North America and Europe remained the electronic component industry??s most important shipment destinations, accounting for nearly 60 percent of total shipments in 2004, the same as in 2003. Higher growth rates were seen in destination markets of China and the Asian Pacific region.u*j.I6EQc^
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PCB rigid-boards rank first with a 34 percent share of total production value in 2004, followed by connectors and capacitors. In terms of growth rate, soft-board PCBs, filters, and IC substrates were strongest, reaching 74 percent, 56 percent, and 47 percent, respectively. Additionally, the NB, DT and motherboard markets have been expanding significantly. The number of PCB companies shrank, but their sales revenue has been increasing as the global market builds growth momentum. The 2005 production value of the Taiwanese electronics components industry was an estimated 13 percent, with star products being 3.5 inch monitor-use white light LEDs, connectors for consumer electronic products, plus passive components for use in handsets, and flip chip substrates. Also, in 2004, the value of Taiwan LED production grew dramatically, by 50 percent from the previous year.5C3Ch(tX ]
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The data communication industry also saw tremendous growth of 35 percent in 2004, totaling US$4,524 million, while in 2005 robust growth is seen particularly in wireless LAN, VoIP and DSL. Global WLAN industry development is already experiencing shipment highs inspired by the retail market take-off and notebook PC adoption of built-in modules. Although PDA shipments have stayed flat in 2005, Wi-Fi (wireless fidelity) PDAs and GPS PDAs were the major contributors to growth in 2004. In 2005, WI-Fi PDAs and phone PDAs are expected to gradually replace PDAs with phone functions, which have continued to propel growth in the industry, with over one million phone PDAs shipped per quarter.H\7M*n:f Z*b$Pce:[7Y
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The government's National Si-Soft Project, implemented in 2003, offers foreign investors a very easy and attractive way to benefit from the expertise and talent found in Taiwan's integrated and highly efficient IC industry. Aimed at transforming Taiwan's IC industry from a contract-manufacturing one into a production powerhouse based on R&D and innovation, the project focuses on development and the System-on-Chip (SoC) infrastructure. It includes such benefits as providing available intellectual property (IP) sources and a more simplified transaction flow for the IC design industry, helping companies improve their competitiveness in SoC, cultivating leading vendors in the IP industry, generating more customers by emphasizing value-added products, and encouraging greater cooperation among different lines in the industry in order to enhance technological expertise.
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Key players in the growth spurt are new products such as single chips for digital cameras, DVD players, and digital TVs. At the same time, domestic liquid-crystal display (LCD) suppliers increased their shipments, boosting orders for driver chips and DDR- DRAM chips for use with graphic cards.@3G"?m$W8m
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To keep up with growing demand, Taiwan's chip companies have been investing heavily on new equipment beginning in 2004, up 57% from 2003, ending a spending slump that began in 2000. And according to Semiconductor Equipment and Materials International (SEMI), Taiwan saw the largest amount of capital spending in the chip industry by any single economy in 2004. Worldwide, SEMI estimates spending on chip equipment reached US$29.6 billion in 2004, a 39 percent gain from 2003. Overall, Taiwan??s market opportunities in this industry are tremendous, making it an ideal investment destination.
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Taiwan's Consumer Electronics & Electrical Products Industry

The Taiwanese have enjoyed improved living standards over the last four decades. In the latest "Prices and Earnings" annual report of the UBS, Taipei ranked 33 in terms of domestic purchasing power. With a growing number of Taiwan citizens who can buy more with what they earn, more top foreign companies have been attracted to the Taiwan market.
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At the same time, demand for digital multimedia products has been growing rapidly, with the focus shifting to 3C- (computing, communication, and consumer) and IA- (information application) related products. Smart handheld devices, thin client, netTVs, and screen phones are just a few of the new products being turned out by Taiwan manufacturers.
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Home electronics, such as beauty/health, cooking, and food preparation appliances, plus air conditioners, stereo parts and components, audio-video products, and lighting products such as illumination lamps and fluorescent tubes are the industry's main wares. Because this sector is domestically oriented (approximately 70 percent of sales value), the local market actually determines a great deal of this industry's development. (ZR+Pb+Y

b3K6O}7^+h~"} In recent years, the domestic home appliance market has gradually become saturated. The prevalence ratio of home appliance products has reached 90 percent, and the production value of traditional home appliances has limited room to grow. The production value of the home appliance industry in Taiwan reached US$1.35 billion in 2004, a growth of 3.9 percent from 2003, and the first increase since the decline starting in 2000. Notably, large domestic businesses have relocated overseas in recent years.
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In 2004, the rebound of the construction industry has increased demand for fluorescent white tubes, and collaborations between the domestic lighting fixture companies with overseas manufacturers has led to the introduction of new models of automobile lightbulbs and high value-added lightbulbs such as HID lights. Consequently, the production value of the lighting fixture industry increased a significant 16.4 percent in 2004 to reach US$0.5 billion.K G/f| q'W)O?0hb
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To improve coordination and cooperation among Taiwan companies and strengthen technological and marketing ties with global IA leaders, the Taiwan IA Alliance was established to increase the value-added qualities of Taiwan products. Encouraged and supported by Taiwan's government, the Alliance plays a key role in the efforts of manufacturers to speed IA development by integrating communications, information, semiconductors, consumer electronics, photo electronics, and software resources. In addition, IA combines policy, production, learning, and research resources.n,yt3U$F:\
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The manufacturing sector has become increasingly service and consumer focused, as well as more oriented towards product and service integration (i.e. smart home appliances). With such a transformation, products will have higher added value and the industry will become more competitive.
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Taiwan's Computer Hardware, Software, & Peripherals Industry

Taiwan remains a major destination for technology companies outsourcing their manufacturing operations, as leading PC firms continue tapping the services of Taiwan manufacturers due to their capabilities and technical expertise. These manufacturers are also respected for their production flexibility and management efficiency, with the skills, knowledge, and experience that carried them through recent regional economic difficulties. This was apparent during 2004, which saw sales of several IT products, including motherboards, desktop PCs, notebook PCs, and servers moving forward at an impressive rate.
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j5R+y1?m:~ Strengthening design and R&D capabilities underscores the importance of local manufacturers to move up the value chain, and this has been the focus of the industry's recent efforts. In line with this, the government has drawn out a special plan to help the local IT industry attract global technology firms to set up their R&D operations on the island. Among the big names lured by this plan include IBM, Hewlett-Packard, and Microsoft. The most recent recruit is Intel, which recently inaugurated its Innovation Center in Taiwan.)L'BKWY Qb
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Overall, all nine of the Taiwanese main IT hardware product categories enjoyed positive growth in global market share. Besides motherboards and CDT monitors, LCD monitors, notebooks and projectors also experienced due to rapidly increasing demand in 2004.
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Taiwan is the world's fourth largest producer of PCs. In the computing industry, despite falling prices of key components, price competition between brand-name vendors, and sliding ASP (average selling price), higher overall production levels have translated to impressive gains. Total shipment value for Taiwan notebook PC makers rose by over 26 percent year-on-year to reach nearly US$27.7 billion. In contrast to the slowdown of the maturing US and Japanese markets, European and other emerging markets have exhibited strong growth in recent years. And according to MIC, in 2004 the Taiwan software market grew to US$4.9 billion.3LT-]8rj/v

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For the past few years, the majority of Taiwan's manufacturers have bolstered their R&D and design capabilities, exhibiting more qualifications in their quest to become world-class IT innovators. Such talents have proven to be their most potent tools against the growing presence of new IT players from neighboring nations.
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W9f3V.a.I3gO In 2004, exports of LCDs continued to gain momentum, with the value of Taiwan LED production growing dramatically, by 50 percent from the previous year. However, market growth in 2004 remained below that of 2003 due to a dramatic 25-40 percent increase in ASP. Due to a mismatch between supply and demand and new competition from Korea and China, Taiwan's total output value was US$1.56 billion.
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,P*?|B5L"kr&Q/D:B&GP Large-sized TFT-LCD panels, primarily for use in notebooks and LCD monitors grew strongly, due to strong demand from end-market applications such as handsets, notebooks, motherboards and TFT-LCD monitors. Small- and medium-sized LCD monitors also turned in very positive performances, owing to their increased use in products such as cellphones, car TVs, digital cameras, and personal digital appliances. Most LCDs head for the US market, but China and other countries throughout Asia are becoming important destinations as well.1s}/f*O Mc%}|
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Taiwan IT makers continue to upgrade the quality of their products further by devoting more resources to R&D. By doing so, they are aiming for the high-end market and customers, to shed their image as mass suppliers, and transform Taiwan into a world-class IT research and design center.3?-]jX1e!D(B"u:~

;Q*a)y:ws During past decades, the world witnessed the rapid expansion of Taiwan's IT industry. Today, it sees an industry moving to consolidate its position in the global market. By transforming from merely an OEM base into a highly innovative and value-added sector, Taiwan's IT industry is ready to take on both challenges and opportunities that lie ahead.Y;b&E0@(Q9q
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Taiwan's Communication Products Industry

Taiwan offers great potential in telecommunications, with one of the most advanced networks in the region. High penetration rates in both the fixed-line and mobile phone sectors have encouraged growth in telecom products and services; plus, the island is the world's fourth largest producer of PCs. Estimated by IEK-ITI, the top ten products of the Taiwan communication equipment industry in 2004 were, in order, mobile phones, WLAN, xDSL CPE, SOHO routers, GPS, Ethernet switches, Bluetooth, Cable CPE, IP phones, and analog modems. Of these, the products with the most potential for further product growth are Bluetooth and IP phones, which display outstanding growth of 144 percent and 68 percent, respectively.xnh Pgb)Oq
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Communications manufacturers in Taiwan are expected to continue enjoying the boom in the industry until at least 2008, and are getting a jump on their counterparts in seizing the rising demand for broadband equipment, wireless facilities, software, and hardware. In addition, they are bound to benefit from the resumption of large OEM/ODM orders from leading Japanese, European, and US firms. Those most likely to benefit are makers of mobile phones, network equipment, switching systems, and optical fiber facilities.
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2Zp{5T+n'I8X Taiwan producers of network communications equipment are enjoying a peak in sales as a result of the rapid expansion of the broadband Internet market, and as the fast growth and application of wireless communications, such as mobile phones, boost the demand for content and communication services. Orders for both asymmetrical digital subscriber lines (ADSL) and cable modems have, for instance, been extremely brisk, while demand for wireless local area network (WLAN) devices has been booming since 2001 and have become widespread.
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(Sk%IM2O2S[7qLE WLAN devices are being widely applied in the notebook, computer peripheral, and consumer electronics lines, generating great opportunities for Taiwan manufacturers, and in 2004, WLAN output value was US$1.5 billion. OEM/ODM orders from leading international companies have been enormous and, as a result, Taiwan's WLAN-related output accounted for some 80 percent of the global total. Additionally, sustained growth in the number of global DSL users is driving the DSL equipment market, while unit prices have continued to decline. The output value and amount of SOHO routers is constantly growing, too, and the output value of Taiwan switch products reached US$753 million. Currently, the island's manufacturers are striving to gain a foothold in NIC, STB, and Access Points in order to further strengthen their competitiveness.
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`1w"H Although the US and Europe are still the major destination markets for Taiwan broadband networking equipment suppliers, various countries in Asia are receiving increasing demand from the island's manufacturers. China and South Korea are perhaps the largest markets in this regard, with Taiwan companies already shipping substantial quantities of networking equipment to them. In 2004, the total output value of the Taiwan broadband network equipment industry was US$4,237 million, a 25 percent increase from the previous year. The total output value of the wireless communication equipment industry, both domestic and overseas production, was US$13,531 million in 2004, a 14 percent increase year-on-year. #dgvFr8sy!B

(BS*N)Of0y#v A growing number of Taiwan manufacturers also possess manufacturing and marketing capabilities for research and development of xDSL, DLC, SDHH, DWDM, and cell phone-related products. Such strengths combined with the telecommunications service capabilities of foreign companies, particularly in the area of content services, will make it possible to enter newly developing markets and stimulate product demand.?S#Yj&UN#C

0~p {_-V+X&o$t`1b Analysts forecast that very high speed digital subscriber line (VDSL) modems are poised to become the hottest new item for the industry. With the superior transmission speeds they offer, these items are certain to attract great attention in the developed world. Outside Japan, however, most other markets in Asia and the developing world are not yet prepared for a product with such capabilities.
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In order to make Taiwan a broadband communications technology leader, the government has designated it a strategic industry, allowing it to benefit from a host of investment and tax incentives; also, in recent years, Taiwan has gradually liberalized the 3G and wired network markets. In 2005, it saw US$50 billion in equipment purchase orders and US$20 billion in telecommunication service industry revenues. Market opportunities are tremendous, making Taiwan the ideal investment destination for the equipment manufacturing industry and content service providers.
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]6s"QO X$x-z%P Taiwan's digital content industry is expected to grow at an average rate of 20 percent over the next three years, particularly in digital animation and film, digital video and audio applications, mobile applications and services, e-learning, and digital publishing and archiving. Taiwan currently has more than 1,700 digital content companies, a number that is expected to grow to over 3,000 by 2006, and investment opportunities abound for foreign investors in the areas of education and training, technology cooperation, co-production, and co-marketing ventures.
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yD1^6@a&gJ Expansion in the network communications industry is also expected to continue its dramatic rise. With Taiwan's continuing focus on improving technology and value-added functions, and its commitment to becoming a digital hub for the Asia-Pacific and global Chinese-language markets, predictions for future industry growth and product enhancements are positive.
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[img]http://www.taiwantrade.com.tw/TWTRADE/STATIC/itis/2006/images/p10.jpg[/img]

Taiwan's Bicycles, Parts, & Products Industry

Taiwan, dubbed the "Bicycle Kingdom", is one of the world??s top production areas for bicycles and is moving away from low price competition toward the development of high value-added models. Whole bikes and parts produced in Taiwan are uniquely designed and very reliable, with some of the newest models featuring technologically advanced functions. Comparatively, Taiwan-made bicycle products have proven to be more reliable than those from other mass-producing nations. Taiwan has also made headway in the development of higher- and electric-powered bikes and other advanced products.
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&W+g6pdyB"?7n Once a major means of transportation in Taiwan, the bicycle has now changed to a form of recreation, being overtaken by the motorcycle and motorscooter, which are quicker ways to get around. However, bicycles are still a common sight on the streets with students on their way to class or seniors going to shop at produce markets. Today, the Taiwanese are riding everything from older bikes to mountain bicycles, as well as modern folding and electric bicycle models.3]hw;\n5{uwd/w^Y

/K1y%O/r-a}-d Headquartered here are some of the biggest name brands in the biking world. Taiwan is a major research and design center for the development of new technology and hybridization of features. The bicycle industry continues to have great potential for growth because of the evolution in new applications for bicycles and new construction materials.
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{E)uE5P3g I6@'@2|{ With environmental measures such as China forbidding motorcycles in 104 cities to try to cut down on air pollution, it is no wonder that Taiwan's largest manufacturer has become the single manufacturer with the most sales. Other Taiwan manufacturers accept orders for products like electric bicycles on a build-to-order basis. The bicycle industry is moving towards electrically powered vehicles, already apparent, as Taiwan has become the biggest exporter of electric vehicles in the world.
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d&i\-Bh i But with the growing presence of China as the world's manufacturing center today, Taiwan's global dominance is being severely threatened. Faced with such pressure, the Taiwan bicycle industry is closing ranks in order to advance high-end products manufacturing. One of the most significant efforts taken by several leading bike-makers and parts manufacturers in the industry was the formation of the "A-Team," which aims to differentiate Taiwan-made products from those produced in low-cost markets, particularly China. Bolstered by the initial success of the A-Team, the industry's 2004 exports recorded impressive growth, reversing five years of decline. Shipments were valued at US$720 million, which is 23 percent higher compared to the US$583 million in exports of 2003. The industry expects growth to continue this year, with exports estimated to grow by at least 5 percent.
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aMc)@`io b Taiwanese are proven world-class bike producers with a strong background in contract services. A number also have established brand names that are well received in many advanced markets. Taiwan-made bikes are among the most popular choice with riders in the US, Germany, the Netherlands, and Japan. The industry has the full backing of the government for R&D of advanced bike models and key components. Its current focus is on the development of the "3Ns" ?¡ìC New Products, New Functions, and New Uses. High value-added bike models of magnesium alloy and electric bikes will form the major new products, while health- and safety-related features will be its major considerations in the future.Rv"M3F~n!?y F
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As for accessories, from frames, forks and pneumatic rubber tires to brakes, inner tubes, wheel rims, hubs, pedals, gears, derailleurs, and handlebars, there is certainly no limit to the array of products and accessories that can be found in Taiwan. Almost any conceivable accessory for a vehicle on wheels is sourceable on this island; if not, Taiwan's suppliers will find a way to make it for you.
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Taiwan's Automobiles, Motorcycles, Parts, & Accessories Industry

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Taiwan automakers entered the international market early and have long been established in Taiwan. With a history in the international arena, they know how to deal with the industry itself and foreign automakers alike. R&D capability and sales/services systems suitable for this country continue to maintain operations, and the auto parts system consistently meets or exceeds international standards. Flexible production systems are in place and complete factory and quality management structures have been established. All that, and the fact that over 300 Taiwan automotive industry companies have built factories in China contribute to the stability and growth of the automotive market in Taiwan. A growing trend in the auto industry is a transition from being manufacturing-oriented to becoming service-oriented.U j#_S1T6Ltp;Y(k\;Y
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The vehicle industry product value reached US$16 billion in 2004, increasing 14.8 percent from 2003. Total sales during the first eight months of 2004 reached up to 350,000 vehicles, 12.6 percent of which are imported. Domestic vehicles remain the main source of sales, particularly sedans. WTO entry has reduced tariffs, and consequently sales of imported vehicles are expected to rise. However, imported vehicles will have difficulty competing with domestically produced vehicles on price. Japanese automobiles grew the most in the import automobile market. In terms of global automobile production, Taiwan ranked number 18.
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`Nz3g1q With a ratio of one motorcycle to every 1.9 citizens, Taiwan is the world's leader in the rate of motorcycle ownership. It is no wonder that local and foreign industry leaders have set up major operations on Taiwan to not only serve the Taiwan market, but also other countries looking to expand their product lines with quality, technologically advanced vehicles.Ypy8PM}'{%v(WE8\
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Increasingly strict environmental protection requirements ensure new vehicles will be progressively more environment-friendly. Production of 50cc two-stroke motorcycles was stopped in Taiwan in 2003, and motorcycle companies now focus on 125cc motorcycles. There is also a growing transition to the electric vehicle industry, as Taiwan has already become the biggest exporter of electric vehicles in the world. Owing to market saturation, motorcycle companies have increased their advantage in the core business to All Terrain Vehicle (ATV) and electric vehicles, shooting for 25 percent of the global market. Most of Taiwan's major ATV manufacturers are expanding, or planning to expand. The US is Taiwan's main sales and usage market (with an annual growth of 20 percent) and it is expanding to meet the demand from a new, thriving European market. L,VIoqp&hD
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@a"h pji Currently, Taiwan has approximately 2,000 companies engaged in the manufacture of auto parts. About 400 of them specialize in OEM production, with the remainder focusing on the after-sales market. The majority of auto parts producers have SAE, CE mark, E/e mark, and European safety certifications. In addition, Taiwan??s auto-makers have obtained the QS-9000 certification required by the US?? Big Three automakers, and 700 companies have received ISO 9000 certificates.
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!q7@]9B;y?S Taiwan companies are emphasizing the development and introduction of new products, including wireless tire monitoring systems, HID lamps, lubrication equipment, such as angle-free rotating continuous operation air grease guns, and automatic transmission gearboxes. Manufacturers are carrying out extensive R&D work on double-productive chassis, intensive shock absorbers, and automatic generating systems as well.
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]~8m*]$jBV Total auto parts components exports in 2004 amounted to US$4.1 billion, an increase of 18.2 percent over the previous year, and it is predicted that total production value of the industry will reach US$11.9 billion by 2008, due to the expected explosive growth in China??s auto market. In 2004 alone, exports to China grew by 172 percent, and Taiwan's auto-makers are poised to take advantage of continuing growth in that fast-developing market. After-sales service items accounting for the largest portion of shipments abroad. The US was Taiwan's largest auto parts customer, purchasing 35.6 percent of the industry??s exports. Continued strong growth is also expected from Japan, China, and Hong Kong.$l+zW5Ao:d-R

.Ck$AEi1AB'H Auto parts produced in Taiwan are noted for their precision, durability, and safety. Major export items currently include road wheels and parts and accessories, radial tires, pneumatic tires, rear-view mirrors, other parts suitable for use with internal combustion piston engines, lead-acid accumulators, radio-broadcast receivers, electrical lighting and visual signaling equipment, bumpers, body parts, ignition wiring sets, brakes and servo-brakes and parts, carburetors, switches, clutches and related parts, windscreen wipers, oil and petrol filters, steering wheels, radiators, and jacks.
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6tu,Jx U@6t6j-Ba Some of Taiwan's biggest PC companies have entered the auto-electronics business, producing GPS, 3G telecoms, and audio/video products. Two other areas of emerging competitive advantage are electroplating, mold and metal manufacturing -- areas in which strong local production capabilities provide good prospects for business development.3mb%|3M`kC
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Taiwan's government encourages local investment in the use of high-tech, lightweight materials such as magnesium and titanium. Other government initiatives include organizing a comprehensive database of suppliers to assist foreign buyers and hosting major expositions such as the Taipei International Auto/Motorcycle and Accessories show. As Taiwan makers continue to improve and expand their lines, both the OEM and after-sales segments should continue to exhibit strong growth.
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L'sXZ,gK From electric air fresheners, broadcasting mobile phone holsters, and plush seat covers to neon light accents, emergency travel kits, and deluxe toolboxes, there is certainly no limit to the array of products and accessories that can be found in Taiwan. Almost any conceivable accessory for a vehicle on wheels is sourceable on this island, if not, Taiwan's suppliers will find a way to make it for you.;{xed*c8{;z3tl
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Figure 1, page 12-2, ITIS
P.l:N;BZ k E Vehicle Industry Development in Taiwan

Taiwan's Machinery Industry

Combining technology and expertise from the fields of machinery, electronics, optoelectronics, and software, Taiwan's machine tool industry turned a strong performance in 2004. Increasingly, the industry is focusing on high value-added products, like linear-based high-speed machine tools, high-speed, high-precision mold-processing machinery, and high-tech production equipment for the semiconductor, aerospace, optoelectronics, and auto-parts industries.
Pg3ICI z~ Taiwan-made machine tools meet global standards for quality and performance, and are very competitive in terms of price. Taiwan's machine-tool makers are also recognized for a central-satellite system involving related companies that allows them to make optimum use of their capital, as well as for their keen abilities to cut production, management, and marketing costs.
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Y @N~1A#A"n[ Taiwan's machinery exports totaled US$11.29 billion during the first eleven months of 2004. This impressive export record represented an increase of 22 percent over the same period in the previous year, underscoring industry recovery from the 2001 recession and the competitiveness of the island's manufacturers in the global marketplace. Export growth for machine-tool parts and components is reported to have been even stronger -- nearly 45 percent. The industry's total production value of 2004 is ranked fifth in the world. In exports, Taiwan ranked even higher, coming in third.
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Machine tools worth US$2.03 billion were the island's export leaders, followed by plastic and rubber processing machinery at US$843 million, pumps, fans, and compressors at US$813 million, and special purpose machinery at US$706 million. All of these totals reflected very substantial percentage increases over the same period in 2003. Other important categories, in decreasing order of importance, included woodworking machinery, valves, molds and dies, textile machinery, sewing machines, bearings, gears and ball screws, paper-making and printing machines, and leather and shoemaking machines.,H6X&tt\{
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There are some 17,914 manufacturers of machinery in Taiwan, most of which are small- and medium-scale enterprises. The largest number of makers of machine tools and woodworking and shoemaking machinery are located in the Taichung area in central Taiwan, while most mold and die operations are found in Taipei County, with the majority of plastics and rubber machinery makers in southern Taiwan's Tainan County.
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| Among the 21 categories of the Taiwanese machinery industry, the category of "electronic and semiconductor equipment" displayed the highest growth in terms of production value, reaching 74.6 percent in 2004, and more money was invested in the category than the previous three years. Other categories, including metal-cutting machines, metal-forming machines, rubber and plastic machines and metallic model-manufacturing fields achieved growth exceeding 20 percent in 2004. One standout export for 2004 was machining centers ?¡ìC which saw export growth over 43 percent./NM*C;OSpHO1W

IXM j-AD Leading destinations for the industry's exports were Hong Kong and China, which purchased US$4.12 billion worth of Taiwan-made machinery in the first eleven months of 2004, representing a 17 percent gain over the same period in the previous year, totaling 36.5 percent of Taiwan's total industry exports. The second most important export market for Taiwan's manufacturers was the US, which purchased US$2.03 billion worth of machinery, or 18 percent of total exports. Japan ranked third, importing Taiwan machinery worth 5.2 percent of overseas shipments. Shipments to the US and Japan for the period rose by 30 percent and 13 percent, respectively. Thailand, Vietnam, Malaysia, Indonesia, Turkey, Germany, Canada, South Korea, the UK, Singapore, India, Italy, Australia, the Netherlands, the Philippines, Spain, France, Saudi Arabia, and Russia were also major markets for Taiwan's machinery exports. LTZgE.n|

eqh!Pu Taiwan's machinery industry is facing significant challenges, such as increasingly fierce competition from Chinese and Korean makers, particularly in the overseas markets of the US, Europe, and Japan. Taiwan industry is also faced with macroeconomic factors such as the fluctuating cost of steel imports and global crude oil prices. The next wave of governmental intervention in Taiwan will aim to restructure its interest rates and exchange rates between the RMB and the US dollar, and to avoid an over-reliance on exports to China.
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In future, the machine-tool industry will be devoting even more attention to R&D and marketing to maintain its position in international markets. One important industry trend is cooperation between machine-tool manufacturers and companies in high-tech industries such as semiconductors and optoelectronics. Some of the new product lines that have resulted from this type of collaboration are all-electric plastic-injection molding machines, printed circuitboard drilling machines, mini-generators, and equipment for thin-film manufacturing. Such initiatives, together with the development of enhanced cooperation among companies in the industry, should do much to help Taiwan remain a leader in the machinery field in the years ahead.:TC7C*b5VAr
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[img]http://www.taiwantrade.com.tw/TWTRADE/STATIC/itis/2006/images/machinepic.gif[/img]

Taiwan's Metals & Hardware Industry

Molds and dies (tooling) are important components of the metals and hardware industry. The quality and precision with which they are created in Taiwan consistently encourages even Taiwan owners who have set up companies overseas to continue having their tooling made in Taiwan. Recently, an opto-electronics industry cluster has formed in the Southern Taiwan Science-based Industrial Park, ensuring further development of mold and die techniques.
I AfDV-wz Fasteners, including your standard nuts and bolts, also play a large role in this industry. To keep up with demand and with the times, product quality has been upgraded to aerospace level in many factories and the market for electric vehicle components has been entered.
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For aluminum doors and windows, trends in product development include energy saving, humane, and safe designs. New-function aluminum doors and windows, including heat insulation windows, ventilation windows, and kitchen ventilation doors are still in the introduction stage and future growth potential is large.(i~ZQ d&g5~7o

(E#b%D3MC'y&CS;zG As a result of economic development, expanding exports, and a rising standard of living on the island, the demand by Taiwan's steel companies for a broad range of ferrous and non-ferrous metals has increased steadily. Even without an abundance of natural resources and suitable land, Taiwan's metal processing industry has still managed to demonstrate vitality and competitive advantage. From crude steel to tooling molds and dies, to fasteners, valve products, aluminum doors and windows, the metals and hardware industry of Taiwan continues its exploration of new products and markets.r4k
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/~]6j_Xrs Taiwan continues to depend on overseas sources for metals. Taiwan's iron and steel imports in 2004 amounted to US$10.77 billion, an increase of 74.6 percent over the previous year. Iron and steel are mostly imported from Japan, Russia, China, Ukraine, and South Africa, and are required by both government-funded corporations as well as private-sector steel companies, most focused on imports of steel, scrap, ship plate, billets and slabs./Xo0X1h`Q7kb

s X/V?2}Md In the non-ferrous metal category, aluminum, copper, brass, zinc, tin, lead, and nickel are all important for industry as they are important for the manufacture of Taiwan's key export products, particularly aluminum, which is used in the food-packaging, electrical machinery, electronics and pharmaceutical industries, and copper, which is applied extensively to electrical wire and cable. Nickel and zinc imports are substantial as well, amounting to US$877 million in 2004.
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(pH2hRmK In 2004, profit-showing industries included shipping, automotive, and shipbuilding -- all related to the steel industry. Their excellent performance is expected to carry on as steel demand in China enters a high growth stage, gearing up for a new role as a net steel exporter that may turn recent global shortages of steel into oversupply and depress global prices.N/[!@ Zb+\cI-[

;M!t0?3b?Ast%N-U Nearly half of Taiwan's hardware product output is shipped to the US. The rest are distributed across Europe, particularly in the UK and Germany, and to several Middle Eastern nations. The majority of domestic producers have reduced their market stake in Asia recently in order to avoid cutthroat competition with suppliers of cheap hardware items.si|iw

9n9b"v7s[/?hVk"Nd Also, Taiwan has been introducing more advanced valves in the global market. Almost 68 percent of valve production has been destined for export, with volume expected to expand by four percent in the next year. The industry's newly developed valves include super cleaning valves, micro valves, and other specialized types of valves. The industry hopes to carve a niche in high-value valves over the next few years.Mh| }-wtVe-D

o4m}u$Q Overall, most manufacturers continue to work on developing innovative techniques. The metals and hardware industry strives to overcome price competition, upgrade self-capabilities, and develop new markets.p2[j9O'q^Q

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Taiwan's Hand Tool Industry

Taiwan's more than 500 toolmakers have a reputation for highly efficient production operations, superior management, and a knowledgeable, experienced workforce. Like a number of other industries on the island, the hand tool industry benefits from a comprehensive central-satellite system that helps ensure an effective division of labor, maximizes competitiveness, and increases flexibility. As a result of these strengths, Taiwan makers are favored for items used in repair, assembly, installation, and construction work.
-Dg,c"UI#O^6w Manufacturers on this island are, in fact, doing increasingly well in penetrating the market for higher value-added tools in the US and throughout the world. Many are emphasizing high-end chrome vanadium and chrome molybdenum steel tools. Magnesium alloy is also being utilized with great success, particularly in the manufacture of sophisticated pneumatic hand tools and garden tools.
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(g#bY7EGyf High standard raw materials and excellent processing techniques are keys to the continuing success of this industry. These together with the outstanding manufacturing flexibility of the local firms give Taiwan the due advantage over China. For years, the product quality of Taiwan-made hand tools has been proven reliable and guaranteed safe to use. They meet prevailing global standards for quality and performance and are very competitive in terms of price.
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Currently being explored by local manufacturers with the support of the Mechanical Industry Research Laboratory (MIRL), the development of hand tools with digital technology is proving to be an excellent value-added feature. According to the MIRL, the digital concept will immensely contribute to the growth and development of the Taiwan hand tool industry.
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Overall, the positive performance of the industry can be attributed to the ability of high-end tool manufacturers to compete effectively with rivals in Japan and the determination of makers of low- and mid-range items to cope with competitors in China. Steady growth of the DIY market will continue to stimulate demand in the hand tools market.N{N'v1v@

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Note: The above information is from http://www.taiwantrade.com.tw Z C#G%Vz(rK
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