Linking You to a World of PROFIT in Asia
Taiwan Business Alliance
I. Taiwan’s Foreign Trade and Economy
II. Taiwan’s Global Competitiveness
III. Investment Incentives
IV. What TAITRA can do for you
Topics
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I. Taiwan’s Foreign Trade
and Economy
6
Taiwan Economic Facts
GDP US$ 589.4 Billion
2018
Economic Growth Rate
2.6 %
2018
GDP per capita (PPP)
* 19th in the world
US$ 52,960 (*IMF)
2018
Foreign Trade
*18th in the world
US$ 335.9 Billion (Export)
2018
US$ 286.3 Billion (Import)
2018
Foreign Exchange
Reserves
*5th in the world
US$ 467.23 Billion
2018
Source: Department of Statistics, MOEA 2017, Central Bank of ROC(Taiwan)
Source: Department of Statistics, MOEA 2019, ROC(Taiwan) ,IMF 4
Taiwan Economic Facts
Taiwan exports to Germany in 2018:
USD 7.06 Billion *4th in Asia
Taiwan imports from Germany in 2018:
USD 9.96 Billion *6th in Asia
Germany is Taiwan’s 1st trading
partner in the EU
II. Taiwan’s Global Competitiveness
3
Taiwan’s Global Competitiveness
World Economic Forum (WEF)
Global Competitiveness Report 2018
13th in Overall Ranking (among 140 countries ); 4th in Asia
•1st in “Macroeconomic stability”
•4th in “Innovation capability”
•7th in “Financial system”
Business Environment Risk Intelligence (BERI)
Investment Environment Risk Assessment Report 2018
• 4th in Profit Opportunity Recommendation (among 50 countries); 2nd in Asia
International Institute for Management (IMD)
The World Competitiveness Scoreboard 2019
• 16th in Overall Ranking (among 63 countries ) ); 4th in Asia
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Taiwan’s Global Competitiveness
World’s Leading Provider of ICT Products
#2
#1
#1
#1 #1
#1 #1
#1 Source: ITIS 2017
LCD Monitor
Market Share: 25.6%
DSL CPE
Market Share: 65.4%
Desktop computer
Market Share: 27.8%
IC Foundry
Market Share: 73.1%
Notebook
Market Share: 81.5% Cable CPE
Market Share: 77.1%
#1
Motherboard
Market Share: 89.1%
WLAN
Market Share: 67.1%
PND
Market Share: 57.8% 8
Overseas Production Included
Why choose Taiwan?
Strong Industry Clusters
R&D and Innovation, Science Parks
and Software Parks
High quality Human Resource
Efficient Logistics, Distribution Center & Free Trade Ports
Taiwan’s Global Competitiveness
9
Why Choose Taiwan
Strong Industry
Clusters
R&D and
Innovation,
Science Parks, &
Software Parks
High Quality Human
Resources
Efficient Logistics
Distribution Centers, &
Free Trade Ports
10
Yunlin
Petrochemicals,Optoelectronics
Taipei
ICT, Electronics, Software
Taoyuan
CDs, PCBs, Automobiles Hsinchu
Electronics, IC, Optoelectronics, Biotech Miaoli
Optoelectronics, Automobiles Taichung
Hand Tools,Traditional Hardware, Bicycles,
Machinery, Musical Instruments, Autotronics
Tainan
Optoelectronics, Yachts, Textile & Clothing,
Autoparts, Photovoltaics
Kaohsiung
Yachts, Shipbuilding & Steel,Nuts &Screws
Pingtung
Biotechnology, Autoparts
Yilan
Photovoltaics, Optoelectronics
Hualien
Stone Crafts
Taitung
Deep Ocean Water,Tourism
Source: Taiwan Advantage, TAITRA
Source: USPTO 2017
(1) Patents Issued by the United States to Residents of Foreign Countries
R&D and
Innovation,
Science Parks, &
Software Parks
High Quality Human
Resources
Efficient Logistics
Distribution Centers, &
Free Trade Ports
Strong Industry
Clusters
Why Choose Taiwan
7491 7781 7851
9636 9907
11624 12168 12271 12317
[值] 12540
0
2000
4000
6000
8000
10000
12000
14000
2007 2008 2008 2010 2011 2012 2013 2014 2015 2016 2017
20
Source: Kempler 2018
R&D and
Innovation,
Science Parks, &
Software Parks
High Quality Human
Resources
Efficient Logistics
Distribution Centers, &
Free Trade Ports
Strong Industry
Clusters
Why Choose Taiwan
20
MOEA launched the “Multinational Innovative R&D Centers in Taiwan” Program to encourage foreign enterprises to set up R&D centers in Taiwan.
By Jan. 2018, there were 140 incubation centers in Taiwan and the incubation policy has successfully incubated over 8,216 enterprises which helped the registration of 4,387 patents, the transfer of over 2,057 technologies, and the listing of 116 companies.
More than 43 International companies have set up 51 R&D/Innovation Centers in Taiwan.
Source: Invest taiwan, 2018
R&D and
Innovation,
Science Parks, &
Software Parks
High Quality Human
Resources
Efficient Logistics
Distribution Centers, &
Free Trade Ports
Strong Industry
Clusters & Export
Processing Zones
Why Choose Taiwan
13
R&D Personnel
Source: OECD, 2018
R&D and
Innovation,
Science Parks, &
Software Parks
High Quality Human
Resources
Efficient Logistics
Distribution Centers, &
Free Trade Ports
Strong Industry
Clusters
Why Choose Taiwan
0
2
4
6
8
10
12
14
16 14.2 14.9 13.6 13.713.1
11.5
9.9 11.5
10.3
12.8
9.1 9.1 8.2
14
Researcher per 1,000 Employment in 2016
Source: IHME, 2018
R&D and
Innovation,
Science Parks, &
Software Parks
High Quality Human
Resources
Efficient Logistics
Distribution Centers, &
Free Trade Ports
Strong Industry
Clusters
Why Choose Taiwan
15
Global Human Capital Ranking:
Taiwan 1st in Asia
5th in the World, next to Finland、
Iceland、Denmark、The Netherlands
Among 195 countries and territories
Why Choose Taiwan
R&D and
Innovation,
Science Parks, &
Software Parks
High Quality Human
Resources
Efficient Logistics
Distribution Centers, &
Free Trade Ports
Strong Industry
Clusters & Export
Processing Zones
Taiwan as an Ideal air/sea transit hub
Beijing
Seoul Tokyo
Hong Kong
3:30
1:40
3:00
2:20
1:40
Shanghai
Taiwan offers the shortest
average flying time to major
Western Pacific cities:
2 hours and 42 minutes
Direct air and sea links with China:
■ Direct flying destinations: 54
■ Direct flights: 670/week
■ Cargo charter flights: 68/week
■ Sea transport:
13 harbors in Taiwan,
72 harbors in China
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Why Choose Taiwan
15 multinational companies set up
global distribution centers in Taiwan
Source: MOEA 2016
R&D and
Innovation,
Science Parks, &
Software Parks
High Quality Human
Resources
Efficient Logistics
Distribution Centers, &
Free Trade Ports
Strong Industry
Clusters & Export
Processing Zones
17
III. Investment Incentives
3
5+2 Innovative Industries
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Items Subsidies
R&D Tax Deduction
(1) 15% of expenses applied to the current year
(2) 10% of expenses applied for three years;
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Central Government Incentives
Biotechnology and
New
Pharmaceutical
Industries
(1). 35% of R&D and employee training expenditures
may be claimed as a deductible
(2). 20% of the amount invested may be claimed as a
deductible expense against their payable business
income tax.
Items Subsidies
Private Participation
in Major
Infrastructure Projects
a five-year business income tax exemption, investment
tax credits, and exemption of tariffs on imported
construction machinery as well as deductions on the
house tax, land value tax, and deed tax.
21
Central Government Incentives
Tourism Industry 10% - 20% of international tourism promotion
expenditures as a deduction against payable business
income tax for the current year.
Film Production
a maximum of 20 percent of the amount paid for the
share acquisitions against the amount of the profit-
seeking-enterprise income tax payable each year
within a period of five years from the then-current year.
Items Subsidies
Hiring Additional
Employees
(1). Hiring additional full-time employees and raise their
overall salary expenses can recognize additional tax
deductible salary expenses up to 130% of the salaries
paid to Taiwanese employees newly hired in the current
year.
(2). For additional domestic hires who are 24 years old
or younger, SMEs can deduct up to 150% of the annual
gross salary payments to these young domestic hires
from their then current year profit-seeking enterprise
income.
22
Central Government Incentives
Items Subsidies
Land Incentives for Industrial Parks
(1). The program provides rent-free leasing for the first
two years for land in industrial parks being developed
under the jurisdiction of the MOEA;
(2). A lessee who completes utilization in accordance
with the approved plan within two years will enjoy
free land rental for the first two years, and may apply
for the interest-free return of the two-year rental fee
that was prepaid in cash or use it to offset future
rental fees.
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Source:
https://investtaiwan.nat.gov.tw/showPage?lang=eng&search=reward
Central Government Incentives
Items Subsidies
Land and
Management Fee
Incentives for Export
Processing Zones
Rental Incentives:
When there is an approved demolition and rebuilding
of an old factory, rental incentives are offered starting
from the commencement date listed on the building
permit. No land rent is charged in the first two years, a
40% discount is offered in the third and fourth years, and
a 20% discount is offered in the fifth and sixth years.
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Source:
https://investtaiwan.nat.gov.tw/showPage?lang=eng&search=reward
Central Government Incentives
Value-Added
Business (VAT) Tax Deduction
Foreign enterprises, institutions, organizations, or
associations that do not have a fixed place of business
in Taiwan and that purchase goods or services for
exhibitions or temporary business activities within a
period of one year and on which the VAT is more than
NTD 5,000 may qualify for a VAT refund on the goods or
services.
Items Subsidies
Interest Payments Subsidized 2.5% interest rate, Longest for 2 years
Up to 50 million
City-owned Real
Estate Subsidy
Free rental for construction period
Subsidized 50% rental for 2 to 5 years after getting
licence
Job Training Subsidized 50% of training cost
New Hired
Employees' Payroll Taipei City Citizen only, 10k per person for 12 months
Up to 5 million
Annual Housing &
Land-value Tax
Subsidized 100% for first 2 years, 50% for the following 3
years
Up to 50 million
Rental subsidy Subsidized 50% of monthly rental, Longest for 5 years
Up to 5 million
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Taipei City Government Incentives
Source:
https://www.industry-incentive.taipei/page_result_en.aspx#downloadblock1
Items Subsidies
Tax Incentives
(1). No import duty, commodity tax nor business tax will
be imposed on machineries, instruments, raw materials,
fuel, materials and semi-finished products imported by a
Park enterprise for its own use. The enterprise is also
excused from the off-duty, warrant, filing, or tax-
mortgage process.
(2). All products or labor outputs exported by Park
enterprises are exempted from business taxation.
Incentives for
Research and
Development
R&D expenses can be deducted from corporate
income tax up to 15% but the total deducted expenses
can not exceed 30% of the total corporate income tax.
26
Hsinchu Science Park Incentives
Source:
https://www.industry-incentive.taipei/page_result_en.aspx#downloadblock1
Items Subsidies
Incentives Regarding
the Act Governing
Biotech and New
Medicine Industry
Development
(1). Listed shareholders investing in biotech or new
medicine corporations more than three years can be
exempted from corporate income tax within a period of
five years up to a total of 20% of the price of stock
shares gained. For entities of venture capitalists,
corporate income tax can be exempted from the
fourth year of stock shares gained, with the same period
of five years.
(2). 35% of R&D expenditure can be deducted from
corporate income tax within a period of five years since
a real corporate profit gain.
(3). Amount of R&D expenditure exceeding the
averaged amount of former two years, the exceeded
portion of R&D expenditure enjoys a deduction rate of
50% from corporate income tax.
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Hsinchu Science Park Incentives
Source:
https://www.industry-incentive.taipei/page_result_en.aspx#downloadblock1
Items Subsidies
Developers
Incentive 50% discount on land rental during construction. Limit of
three years.
Enterprises in the
Park The plan offers a 40% land rental discount during years 1
and 2 and a 20% discount during years 3 and 4.
Enterprises in the
Park
(Lease to Build)
The plan offers free land rental during years 1 and 2, a
40% discount during years 3 and 4, and a 20% discount
during years 5 and 6.
Park Management
Fee Years 1 and 2: 40% discount on the management fee
Years 3 and 4: 20% discount on the management fee 28
Taichung Software Park Incentives
Items Subsidies
Enterprises in the
Park The plan offers a 40% land rental discount during years 1
and 2 and a 20% discount during years 3 and 4.
Enterprises in the
Park (Lease to Build)
The plan offers free land rental during years 1 and 2, a
40% discount during years 3 and 4, and a 20% discount
during years 5 and 6.
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Kaohsiung Software Park Incentives
IV. What TAITRA can do for you
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About TAITRA
• Non-profit making trade
promotion organization
• Numerous inbound/
outbound trade promotion
activities
• International exhibitions
and conventions organizer
• 63 overseas
offices worldwide
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TAITRA’s Customized Services
Tailor-made one-on-one meetings with
potential Taiwan suppliers
Efficient and effective vendor or supplier
selection process & matchmaking
Facilitate start-ups through IBC
Participation in Taipei International Trade
Shows
Online Sourcing Hub: www.taiwantrade.com
Investment Consultancy + Office space
32
TAITRA’s major activities
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40+ Taiwan Trade Fairs
10+ Germany Trade Fairs
10+ Sourcing Taiwan Event
Benefits from using TAITRA’s services
Save your time
Free & Customized
services worldwide
Sound advice
What TAITRA Can Do For You
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Feel Free to contact us@ Taiwan Trade Center, Düsseldorf TEL: 0211 78180 EMAIL: [email protected]
Thank you!