Taiwan Must Diversify Its Export Markets, Economy Chief Says

  • China market isn’t sufficient to revive flagging export demand
  • Tsinghua Unigroup’s chip deals under review for jobs impact

Taiwan must seek more diverse trade partners apart from China, increase its presence in Southeast Asia and India, and seek to join regional agreements such as the Trans-Pacific Partnership, according to the island’s new economic affairs minister.

"With 15 months of shrinking exports, relying on strengthening China relations won’t solve the problem," Lee Chih-kung said in Taipei Wednesday at a press briefing, his first since being sworn in to lead the ministry. "Even if we were on very good terms, domestic demand isn’t supporting growth enough."

Taiwan’s economy contracted 0.84 percent year-on-year in the first quarter, the only economy in Asia that started the year with negative growth. Exports, which account for about two-thirds of gross domestic product, have fallen since February 2015. New President Tsai Ing-wen, who took office last week, pledged to boost the island’s prospects through trade deals, upgrading industry and fostering innovation.

Taiwan will release revised first-quarter GDP figures Friday. The median estimate in a Bloomberg survey is for a slight upward revision to 0.8 percent contraction year-on-year.

The island’s economic affairs ministry also oversees foreign investment via its Investment Commission. Key deals before the panel currently include an application from China’s Tsinghua Unigroup Ltd. to take stakes in Taiwanese chip testers Powertech Technology Inc. and ChipMOS Technologies Inc., which were announced last year.

Investment Commission Executive Secretary Emile Chang said on the sidelines of the briefing that it is seeking shareholding information from Tsinghua Unigroup. Lee said all high-tech deals will take into account national security and the impact on jobs as well as talent transfer.

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