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I came to Taiwan for my own personal reasons, but if you are not here already, why is Taiwan an attractive place to start a business?
Hi-tech, Wealthy, Democratic Environment
Taiwan is a modern first-world country with excellent infrastructure and a good quality of life. Everyone in Taiwan has access to good healthcare, corruption is rare, and there is strong commitment to human rights and freedom of speech.
For decades, Taiwan has been one of the ‘Asian Tigers’ boasting a strong manufacturing industry with expertise in electronics and technology. Today, there is an increasing focus on software and creative industries.
If you need to build a hardware product, Taiwan is a wonderful place because you can go out and find high quality suppliers and partners offering a whole buffet of components and systems at various levels of completeness.
Something like 25% of China’s exports are actually sales by Taiwanese companies operating subsidiaries in China. Many companies also have factories in other countries in the region, so sourcing in Taiwan gives you a diversified supply chain.
Gateway To China
Taiwan is the perfect stepping stone if you want to do business with China. It is the most similar market, with strong cultural links, and is a great place to test new products - or your own cross-cultural business skills - before heading across the Taiwan Strait.
The contacts that you make in Taiwan will be invaluable when you enter the China market, as Taiwanese businesses with connections on the mainland will be able to help you in this very difficult environment.
Fantastic Hardware Eco-system In Taiwan
I am involved in a new start-up that is developing a proprietary tablet PC that will run our own software for a specific vertical market.
We have easily found suppliers of LCD screens, motherboards, and all the other components and a company to assemble it all. I am not saying that it would be impossible to do this in other countries, but I think it is much easier in Taiwan.
Favorable Legal Environment
Getting permission to invest in Taiwan is a process that takes 4-8 weeks, but it is very straight forward with few surprises.
Unlike some other countries like Thailand, as a foreigner in Taiwan you are free to own your own business 100%, and generally have the same rights as any local person. If you need to go to court for any reason, you can be reasonably confident of a fair hearing without anyone asking for bribes.
Taiwan is at the heart of the Asia-Pacific region, and has excellent transportation links to everywhere. The average flying time from Taiwan to the seven major cities in the Western Pacific is merely 2 hours and 55 minutes.
The average sailing time from Taiwan’s largest international harbor in Kaohsiung to the 5 major Asia-Pacific harbors is only 53 hours.
For years there were no direct flights between Taiwan and China due to the political situation. To fly to China, you had to go via Hong Kong, which cost more money and time. From 2008, it became possible to fly directly from Taipei to Beijing or Shanghai. There are now many flights daily and immigration formalities are kept to a minimum.
According to the World Economic Forum’s “2011 World Competitiveness Report” Taiwan ranks number six globally for R&D talent. According to the National Science Council, Taiwan has 10.6 researchers per one thousand employees. This is behind only Finland, equal to Japan, and slightly higher than the US1.
Looking at the numbers, Taiwan also has an advantage from a highly educated workforce. 43.7% of the workforce has a college degree, university or higher education background. Taiwan has a workforce of about 10 million people, accounting for about 48.07% of the total population. Every year, 320,000 students graduate from college, university or higher education.
Internet usage is very high in Taiwan. Seventy percent of all households have internet access, 90% of all homes in Taiwan own PCs, and more than 65% of homes have broadband.
Add to this that more and more people are going online with their smart phones using fast and reliable mobile internet. Coverage is very good. There are few places where you can’t use your phone to get online.
Why We Chose Taiwan
Revital Golan, the founder of Anemone Ventures, explains why Taiwan is a great place to do business:
“Taiwan is diverse and open and it is a great manufacturing hub. Logistically, it is also very well placed. USA and EU markets are stagnating. Asia is growing. Taiwan is a similar consumer market to Mainland China and offers a great place to ‘test’ a product/service prior to entering China. Hong Kong and Singapore are too small, and are not consumer markets. Korea and Japan are too different from China.
Revital adds that Taiwan’s labor laws are very favorable to SMEs. She also has an office in South Korea, where she feels the laws are too favorable to workers.
Park Gi Tae, a South Korean businessman living in Taiwan, agrees that Taiwan is a great place to do business. There is economic freedom, the price and quality of manufactured products are reasonable, and Taiwan is geographically well placed, being near to China and Korea.
Taiwanese are also very pragmatic when it comes to business. Gi Tae often approaches manufacturers for prices and samples and finds them very receptive to small businesses. This is in contrast to Korea where manufacturers may look down upon small businesses. It is primarily for this reason that Gi Tae has decided to stay in Taiwan and develop his business.
In Gi Tae’s opinion, Taiwan has another advantage over Korea: the workforce. There are plenty of well-educated and productive people in both countries, but in Korea, the salary for an average graduate is a lot higher - around NT$60,000 vs. NT$25,000 in Taiwan.