News
 

Taiwanese businesses in NSP countries see large revenue growth: Report
 

09/05/2023 10:29 PMListen

Taipei, Sept. 5 (CNA) The revenue of the 1,000 biggest Taiwanese-owned companies in countries under the New Southbound Policy (NSP) has grown from NT$3.58 trillion in 2017 to NT$8.4 trillion in 2021, a 134.6% jump in five years, according to a report by the Taiwan-based credit information company CRIF.

In a forum on Taiwan's investments in NSP countries organized by the magazine Business Today, CRIF editor-in-chief Liu Jen (劉任) told the audience that based on his firm's latest report, Taiwanese companies investing in these countries are making significantly more sales revenue than five years ago.

During that same period, Liu said, the top 1,000 Taiwanese companies in China saw a decrease in revenue from NT$21.4 trillion to NT$17.4 trillion.

While companies in China still earned a lot more in absolute terms than those in Southeast Asian countries, the rate of growth has shifted, according to Liu.

"The sales revenue of the top 1,000 Taiwanese companies in NSP countries was only 17 percent of that of the companies investing in China [in 2017], but by 2021 it had grown to about 48 percent," Liu said.

The net income growth of the top 1,000 Taiwanese companies in NSP countries has been even more striking, he said, pointing out that it rose by a whopping 418 percent, from NT$109.4 billion to NT$567.1 billion, between 2017 and 2021.

The current administration in Taiwan has been promoting the so-called New Southbound Policy since 2016, which encourages Taiwanese companies to invest in Southeast Asia, South Asia, New Zealand, and Australia, to diversify their investments and rely less on China.

Finance Minister Chuang Tsui-yun (莊翠雲) and Deputy Economics Minister Chen Chern-chyi (陳正祺), who were invited to the forum, backed up the CRIF report with government figures.

"The investments approved for the 18 countries under the NSP were US$2.8 billion in 2019, which increased to US$5.3 billion in 2022, showing a growth rate of 90 percent," said Chuang, stressing that the Ministry of Finance has been helping Taiwanese businesses in these countries in the areas of taxation and finance.

The former comes in the form of taxation agreements with eight NSP countries (Australia, India, Indonesia, Malaysia, New Zealand, Singapore, Thailand, and Vietnam), while the latter involves protection mechanisms provided by the country's Export-Import Bank and loans granted by state-owned banks, which have established 78 service locations in NSP countries.

In 2022, state-owned banks loaned a total of NT$767.4 billion to Taiwanese businesses in these countries, up from NT$636.5 billion in 2021, Chuang said.

"Also, in 2022, the trade volume between Taiwan and NSP countries reached US$180.3 billion, with Taiwan's exports to the countries hitting US$96.9 billion, both record highs," Chuang said.

Chen noted that in 2016, total trade volume was less than US$100 billion.

The deputy economics minister also stressed that the investments have facilitated the clustering of Taiwanese industries, which is helped by the "summit forums" Taiwan's government holds for various industries together with NSP countries. At these forums, Taiwanese companies can find business opportunities and be receive governmental assistance, such as help with required technical upgrades, he said.

"The PCB (printed circuit board) industry in Thailand, the electronics industry in northern Vietnam, the IC packaging and testing industry in Malaysia, and the new energy industry in Indonesia, for example, have all seen clusters of Taiwanese businesses develop," Chen said.

At the forum, representatives and investment heads from six NSP countries' offices in Taiwan delivered presentations on their countries' investment environments. The countries included India, Indonesia, Malaysia, the Philippines, Thailand, and Vietnam.

(By Alison Hsiao)

 

 

Link, https://focustaiwan.tw/business/202309050029 

Ufficio di Rappresentanza di Taipei - Viale Liegi n.17, 00198 Roma | Tel. 06-98262800 - P. Iva 97076980586