Image Credit: Taiwan News
Taiwan’s Chinese National Federation of Industries (CNFI) unveiled its 2024 white paper on Friday, highlighting key challenges for the nation’s economy. At a press conference, CNFI Vice Chair Chen Chin-tsai addressed four critical issues affecting Taiwan’s industrial landscape.
According to Chen, the widening gap between Taiwan’s booming information and communication technology (ICT) sector and lagging industries, such as metals and consumer chemicals, is contributing to an imbalanced economy. This imbalance, he noted, exacerbates the M-shaped economic phenomenon, further increasing income inequality.
Chen also raised concerns about Taiwan’s energy infrastructure, urging the government to strengthen power and water systems. He emphasised the need to address energy demands, particularly with the growing reliance on energy-intensive industries, such as artificial intelligence.
Geopolitical risks were also mentioned by the CNFI. Chen reportedly pointed to recent developments like China’s suspension of preferential tariffs under the Economic Cooperation Framework Agreement (ECFA) and US export controls on high-tech goods, which are affecting cross-strait and global business operations. These geopolitical factors, he said, are increasing uncertainty for Taiwanese businesses.
Discussing environmental issues, Chen warned that Taiwan’s domestic industries may face unfair competition due to impending carbon fees. Without sufficient governmental support, companies could struggle to meet net-zero targets while competing with international imports, he added.
In response to these challenges, Chen proposed focusing on transforming traditional industries, reforming outdated tax policies, and fostering innovation. With recent increases in tax revenue, he believed the government should allocate more resources to support these initiatives, ensuring Taiwan’s industrial ecosystem remains competitive and sustainable.