Taiwan - Upholding the world's most important supply chains

Renowned as an economic 'miracle,' Taiwan's export-led trade strategy, adopted after World War II, saw it achieve massive economic expansion and rapid industrialisation in the decades leading up to the 21st century

Today, Taiwan plays a critical role in building resiliency and redundancy into global supply chains and is set to benefit massively from the US-led tailwind of companies realigning their supply chains away from the People's Republic of China (PRC). Taiwan's proximity, open economy, and strategic location as a hub for international trade and shipping have attracted substantial interest from the global business community, with the IMF predicting a 3% rise in the export volume of goods and services this year.

Beginning in 2019, Taiwan's government has implemented a series of reforms to capture the global business community's diversification effort. Recently, the government announced an extension of its highly successful 2019 reshoring initiative until 2024. The initiative encourages Taiwanese companies to shift production back to the island from the PRC with favourable loans and access to factory sites and skilled labour. Hailed as a success, the scheme contributed to the 19% year-over-year increase in domestic private investment in 2021, according to the U.S. Department of State, and a record-high annual budget surplus of almost NTD 300 billion the same year. "The stability of our public finances has, in turn, given us more resources to invest in infrastructure, boost scientific research... Through effective policies and government spending, we will boost our investments in next-generation infrastructure and talent cultivation, creating more job opportunities and upholding our economic growth momentum," said Taiwan's president, Tsai Ing-wen, in her 2022 National Day speech.