US firms in Taiwan have needs they want met, from natural disasters to grid upgrades

American business leaders say Taiwan has fallen behind in making changes to cope with natural disasters, talent shortages, energy resilience and the shifting needs of foreign businesses, and they recommended that the island align itself with international standards to attract foreign investments.

Meanwhile, the 1,200-member, 570-company AmCham Taiwan said its committees considered just five of the 95 issues that the chamber raised last year to be fully resolved, according to an annual white paper released on Thursday.

"Now ranked as one of the world's richest countries in terms of financial assets, Taiwan stands at the threshold of a transformative era," the American Chamber of Commerce's annual report said, noting the inauguration of a new leader in May. "Unfortunately, progress in transforming the business environment has not been aligned with a sense of urgency in recent years."

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Taiwan holds a leading position in the global chipmaking industry, especially in advanced semiconductors. But it also remains the sharp focus of geopolitical considerations that have influenced international business decisions and contributed to the shifting of supply chains toward other parts of the world.

In the report's "Messages to Washington" section, the chamber also spoke to the importance of high-level US officials conducting visits to the island "more frequently", as such visits "may be perceived as more provocative" when they are rare. And the chamber sought to "ensure continued sufficient support for Taiwan's defence".

Beijing sees Taiwan as part of China to be reunited by force if necessary. Most countries, including the US, do not recognise Taiwan as an independent state, but Washington is opposed to any attempt to take the self-governed island by force and is committed to supplying it with weapons.

AmCham's paper further suggested that Taiwan take "a variety of strategic measures" to support energy, highways, telecommunications, power plants and water supplies.

Relaxing the Port of Taichung's "restricted hours" would help transport large wind-turbine components and deploy renewable-energy projects, the report said. "Bureaucratic and regulatory challenges" could further stymie infrastructure development, AmCham added.

Some infrastructure, it said, may be subject to natural disasters or "other incidents". Frequent earthquakes, including a recent one that registered as the strongest there in 25 years, have damaged buildings and severed highways.

To encourage investment, the US Senate should move ahead with a bill to avoid double taxation with Taiwan, the paper said. The US House of Representatives passed legislation in January, but AmCham says it remains "stuck" in a Senate committee.

"Considering the benefits that both economies would derive from this legislation, as well as the symbolic value that its passage would represent for US-Taiwan relations, we request speedy action in Washington to find a creative solution to the current impasse," the paper said.

Taiwan must similarly pounce when the chance arises, said Darson Chiu, director general of the Taipei-based Confederation of Asia-Pacific Chambers of Commerce and Industry.

"Once the Senate follows suit, Taiwan must be ready to enact reciprocal legislation," Chiu said. "This issue is of significant concern and interest to Taiwan."

On the trade front, the white paper urged Taiwan to finish the US-Taiwan Initiative on 21st Century Trade, a liberalisation deal in talks for the past two years. The two sides differ on certain labour and environmental practices, as well as agricultural-export rules.

Completion would lead to "conversations on moving on to sign a full-fledged bilateral trade agreement", the American chamber forecast.

AmCham also said that visits by US officials would aid in "policy alignment" efforts while enabling US companies to more easily flag concerns.

An ageing Taiwanese population "underscores the urgent need" for planning the future, AmCham added. Talent shortages have been weighing on a range of domestic industries.

AmCham suggested that more funding be allocated for the island's maths and science education to develop local talent, and that visa rules be augmented with "comprehensive resources" to let foreign workers smoothly adapt in Taiwan. A Taiwanese official said in 2022 that the island was looking to attract 400,000 more foreign workers to its critical sectors by 2030.

Such resources, AmCham said, would meet company needs by promoting the "seamless movement of talent across borders".

This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2024 South China Morning Post Publishers Ltd. All rights reserved.

Copyright (c) 2024. South China Morning Post Publishers Ltd. All rights reserved.