The Dismal Science Got a Bit Cheerier at AmCham’s Economic Outlook Event

While economics might be called “the dismal science,” on November 17 AmCham Taipei members were treated to a lively presentation and discussion by a decidedly charming economist – Chen Shin-hui, assistant research fellow at the Center for Economic Forecasting, part of the Chung-Hua Institution for Economic Research (CIER). Chen’s major role at CIER is to compile the monthly Purchasing Managers’ Index (PMI), a monthly survey of Taiwan’s major industries that is widely viewed as a leading indicator of the economic health of the manufacturing sector.

From left to right: AmCham Capital Markets Committee Co-Chair Chung-Ping Liu, Executive Vice President, Fubon Financial Holding Co., Ltd.; Speaker Shin-Hui Chen; and Governor & AmCham HR Committee Co-Chair Seraphim Ma, Senior Partner, Baker & McKenzie

In her presentation entitled, “Taiwan’s Economic Situation and Outlook,” she was therefore able to offer unparalleled insights into Taiwan’s economy.

Chen started with an overview of the global economy and how Taiwan has benefited from the recent upturn in growth and trade. The global economy is looking to post higher growth rates in 2017 in the vicinity of 3.6% on the strength of modest growth in the United States (2.17%), the Eurozone (2.22%), and China (6.8%), according to the Global Insights website, as reported in late October. Chen noted that Global Insights remains particularly bullish on anticipated tax cuts and business growth in the United States. The OECD, meanwhile, though more cautious, likewise sees broad-based recovery throughout the economies it tracks.

This global recovery has resulted in a 20-month long expansion in Taiwan’s exports, up 13% in year-to-date annual comparisons as of October, according to the Bureau of Foreign Trade under the Ministry of Economic Affairs (MOEA).

The PMI tracked by Chen reflects this upward trend, coming in at 57.7, although it fell a slight 1.7% from September’s 58.7. Anything over 50 is considered expansion. Chen noted that both New Export Orders and Industrial Production Indexes also recorded healthy scores of 58.6 and 57.9, respectively, although both were down slightly from the previous month. What’s more, this expansion was seen in all of Taiwan’s major industrial sectors.

However, Chen reminded attendees that despite these rosy numbers, Taiwan’s economy remains fragile and so far incapable of meeting its potential.

She noted that despite the massive contraction Taiwan experienced in the recession of 2009, it failed to diversify its trade partners to reduce its overreliance on cross-Strait trade, resulting in a downturn in exports whenever China’s economy slows, and leaving it vulnerable to trade declines as China’s domestic supply chain upgrades and gains competitiveness on Taiwanese manufacturers. Taiwan experienced this situation in 2015-2016 when it saw 17 months of export contractions.

Even more significantly, Taiwan’s non-export sectors remain underdeveloped and sluggish. More than two-thirds of Taiwan’s economy is comprised of service-related industries, but more than two-thirds of the economic growth results from its exports, pointing to weakness in the service economy and an overreliance on trade.

Taiwan’s Non-Manufacturing Index (NMI) which tracks the service economy, is likewise up, to 53.6, with growth seen in several major components, including Finance and Insurance, Transportation and Storage, and Education. But costs have also risen this year by 2 percentage points, indicating upward pressure, causing a decline in activity in several categories, including Construction and Real Estate. Cross-Strait tensions are also playing a role, with Chinese tourism down significantly. Chen noted that while many have observed that the drop in Chinese tourism numbers has been offset by visitors from other countries, the Chinese tourists are particularly lucrative for the Taiwan market, as they tend to stay longer and spend more.

She also noted that recent legislation, particularly the newly amended Labor Standards Act, is also impacting costs across the economy in both manufacturing and service industries.

Chen’s diagnosis of the problems facing Taiwan came complete with some suggestions for how to improve its prospects. Liberalizing the financial sector was one, as well as encouraging the government to consult more with industry on how to improve conditions.

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Note: AmCham events are intended primarily for AmCham members and their guests. Many events are open to members’ guests and other non-members, but the attendance of any non-member must be approved in advance. AmCham reserves the right not to admit a non-member to any event without explanation.

2017 Annual General Meeting

AmCham Taipei held its Annual General Meeting on November 21 at the Shangri-La’s Far Eastern Plaza Hotel. Members and guests gathered to vote for the upcoming year’s Board of Governors and changes to the Chamber’s Articles of Association. More than 160 AmCham Taipei members and guests attended the event, including chief executives and senior management-level officers from various industries.

Opening the session were remarks by AmCham Taipei Chairman, Albert Chang, who thanked the Chamber’s current Board for their services and introduced the board candidates for 2018.

Director Kin W. Moy of the American Institute in Taiwan (AIT) also spoke, expressing his appreciation for the partnership with AmCham on policy issues, regulatory matters, and programs that support bilateral economic relations between Taiwan and the United States. Before introducing Vice President Chen, Director Moy touted the expansion of the United States’ Global Entry program to residents of Taiwan and noted the simultaneous opening of Taiwan’s e-Gate program to U.S. passport holders.

Remarks by Vice President Chen

This year, AmCham Taipei was honored to have Dr. Chen Chien-Jen, Vice President of the Republic of China, as our special guest speaker. Vice President Chen expressed his thanks for the Chamber’s efforts as both an advisor and facilitator in strengthening business ties between Taiwan and the United States. He also said that the “Chamber’s annual Doorknock Trip to Washington is an invaluable communication channel between Taiwan and the U.S.”

Vice President Chen stressed Taiwan’s integration into the global economy and highlighted government policies that could benefit both Taiwan and the U.S:

  • 5+2 Innovative Industries & New Southbound Policy to promote domestic and regional prosperity through the Asia-Pacific. The 5+2 Innovative Industries initiative focuses on green energy, biomedicine, smart machinery, national defense, and an Asian Silicon Valley, as well as new agriculture and the circular economy. At the same time, the New Southbound Policy will benefit businesses in Taiwan and provide opportunities to develop new markets.
  • Taiwan-US bilateral trade agreement to enhance partnerships and foreign relations efforts by reducing trade barriers and facilitating more investment, while creating more job opportunities.

Year in Review

Albert Chang summarized the Chamber’s achievements and progress on resolving key issues over the past year. View the full presentation below.

Election Results

AmCham Taipei conveys our sincere thanks to all of our voting members who attended and offered their support. With your help, we reached a quorum and held a successful election.

The Board structure page on our site will be updated in January to reflect the status of incoming and outgoing Board members. A brief summary of results follows – you may download the complete announcement by clicking here.

2018-2019 Governors (Name, Company)

  • Anita Chen, Google Taiwan
  • Chyi-Woei Chin, Micron Tech Asia Pacific Taiwan
  • Edward Shober, Versum Materials Taiwan Co., Ltd.
  • Joanne Tsai, FOX NETWORKS GROUP
  • Daniel Tseng, Corning Display Technologies Taiwan
  • Fupei Wang, Ogilvy Public Relations

2018 Supervisors (Name, Company) 

  • Petra Jumpers, Eli Lilly and Company (Taiwan), Inc.
  • Joyce Lee, Bristol-Myers Squibb (Taiwan) Ltd.
  • Timothy John Shields, Cigna Taiwan Life Assurance Company Ltd.

Congratulations to the winning candidates, and heartfelt thanks to all who supported the Chamber by participating in the election.

Chairman Albert Chang presents a gift to express the Chamber’s appreciation to President Andrea Wu.

Tribute to Outgoing President Andrea Wu

The Annual General Meeting was also an opportunity for the Chamber to present a gift and express its appreciation to Andrea Wu, who will be stepping down as president on December 31 after more than nine years in the position to devote time to family and travel. A video was shown of Andrea’s participation in AmCham events over the years, and Albert Chang praised her achievements on behalf of the Board and the membership as a whole. In brief remarks, Andrea expressed her gratitude to the Board for its support over the years and thanked the dedicated office team for their contributions.

Chang also announced that the search committee had already selected a highly qualified successor as president, who is expected to take office in January.

New Horizon in Liver Disease Management: Taiwan’s Experience

For many years liver disorders have been seen as Taiwan’s national disease. As a result, liver disease management has been identified as the government’s top public health priority. Hepatitis B virus (HBV) and Hepatitis C virus (HCV) are the two key risk factors for liver cancer. How can the government, physicians, public health experts and the pharmaceutical industry work together even more closely to decrease liver disease in Taiwan?

At a November 7 luncheon presentation sponsored by AmCham Taipei’s Public Health Committee at the Regent Taipei, Dr. Chen Ding-Shinn, an Academician of Academic Sinica, and Dr. Pwu Raoh-Fang, Director of the National Hepatitis C Program Office under the Ministry of Health and Welfare, shared their experiences on liver disease management.

From left to right: AmCham Public Health Committee Co-Chair Joyce Lee, General Manager, Bristol-Myers Squibb (Taiwan) Ltd.; Speaker Dr. Pwu Raoh-Fang Director of the National Hepatitis C Program Office, Ministry of Health and Welfare; Speaker Dr. Chen Ding-Shinna, an Academician of Academic Sinica; and AmCham Taipei President Andrea Wu

Dr. Chen introduced Taiwan’s Viral Hepatitis Control Program that was implemented in the 1980s and explained factors that contributed to the success of the program. But educational programs designed to inform citizens of the importance of vaccinations and treatments are not enough, said Chen. He noted that several challenges remain, as the prevalence of liver disease is still on the rise:

  • Most people who contract HBC or HCV infections are unaware that they are infected
  • Many with known chronic infections are reluctant or refuse to receive treatment
  • Reimbursement of medical treatments is not ideal
  • The screening of HBV/HCV infection is still inadequate
  • Existing data on subjects who have previously been screened for HBsAg (also known as the Australia antigen) /anti-HCV is not well-utilized
  • The number of physicians participating in the treatment program is still inadequate

Following Chen’s presentation, Dr. Pwu provided an overview on how Taiwan will meet the ambitious target of the World Health Organization (WHO) for ending viral hepatitis. He identified two key strategies for achieving this goal: 1) setting a target number of patients to be treated, and 2) aligning with the WHO and improving cross-department collaboration. In closing, Pwu reminded the audience that Taiwan has both the ambition and ability to become a world leader in hepatitis elimination by 2030. It will take both passion and wisdom to achieve this goal, however.

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Note: AmCham events are intended primarily for AmCham members and their guests. Many events are open to members’ guests and other non-members, but the attendance of any non-member must be approved in advance. AmCham reserves the right not to admit a non-member to any event without explanation.

A Visit to Logistic Republic – Taiwan’s Most Modern Logistics Solution

AmCham Taipei members and staff spent a fun and informative afternoon exploring Taiwan’s most innovative and modern logistics hub.

Although Taiwan is one of the most trade-dependent economies in the world, its exports and imports often pass through warehouses that are poorly designed, of substandard condition, or even illegally constructed. Taiwan’s small size means that industrial-zoned land is simply too valuable to be used for warehouses and an estimated two-thirds of Taiwan’s warehouses are illegally located on agricultural land without proper building permits and little investment into modern logistics.

Ally Logistic Property (ALP) bucks this trend by offering modern, innovation and technology-driven warehousing and logistics services to the Taiwan market, as AmCham members learned on their visit Nov. 3 to ALP’s Logistics Republic (LR) massive smart warehouse and logistics hub in Ruifang. Providing logistic services to customers using the Port of Keelung, LR is only in Phase 1 but already encompasses 171,400 square meters.

Hosted by Warren Wang, Executive Assistant to Charlie Chang, Managing Director of ALP, AmCham members were first treated to a tour of the site’s central office. With its modern design and warm wood finish, it resembles a high-end café more than the bland, utilitarian space more typical of the industry – and it even has an espresso bar. Wang told AmCham members that several of ALP customers have been so impressed by the design that they contracted ALP to design their own workspaces as well.

From left to right: AmCham member Warren Wang, Executive Assistant to Managing Director of Ally Logistic Property and Andrea Wu AmCham President

ALP was established just three years ago, with US$1 billion in investment from Cathay Financial Holdings Corp., but is already well on its way towards its goal of building and managing one million square meters of modern smart warehouse and logistics infrastructure. Wang explained that ALP’s LR site is a warehouse solution that maximizes operational efficiency and minimizes transportation needs by co-locating various players in the logistic service industry together with their clients. The company continues to drive innovation in the logistics sector with ambitious expansion plans to meet the needs of Taiwan’s manufacturers, retailers, e-commerce businesses, and third-party logistic service providers, he said.

Following Wang’s briefing, AmCham members piled into the bus once more to visit the actual warehouses. First on the agenda was a tour of French sporting goods maker Decathlon’s distribution center. Decathlon is a maker of a wide range of sporting goods, from weightlifting gear to racing bicycles and badminton racquets. Jimmy Correia, Decathlon’s Taiwan Logistics Leader, led AmCham members on a tour of the distribution center, where Decathlon’s youthful and sporty logistics workers “pick and pack” – with the help of advanced technology – sporting goods for shipment to Decathlon’s stores in Taiwan and around the world.

Following these tours, AmCham members were treated to some of Dyna Logistics’ wares – a wine tasting sponsored by Dyna Logistics and ALP.

A tour of the LR Wine Hub followed, led by the General Manager of Dyna Logistics, James Pong. In marked contrast to Decathlon’s distribution center, which bustled with youthful staff, Dyna Logistics’ cavernous wine hub was eerily quiet. Pong told AmCham members that the entire warehouse was staffed by fewer than a dozen workers, with most of the wines picked from the tall racks soaring 20 meters above by huge vertical machines that traversed the aisles. With fragile, irregularly shaped bottles and strict temperature requirements, wine is notoriously challenging to ship and store, yet Dyna Logistics’ automation and climate control enabled the warehousing operation to function with smooth precision.

Following these tours, AmCham members were treated to some of Dyna Logistics’ wares – a wine tasting sponsored by Dyna Logistics and ALP. AmCham conveyed its special thanks to ALP for sponsoring the roundtrip bus ride to the Logistic Republic Park in Ruifang.

Interested in attending our events? Join us at other upcoming events, click here.

Note: AmCham events are intended primarily for AmCham members and their guests. Many events are open to members’ guests and other non-members, but the attendance of any non-member must be approved in advance. AmCham reserves the right not to admit a non-member to any event without explanation.

Visit of Cosmetics Trade Specialist Tonya Kemp

Since its establishment early this year, AmCham Taipei’s Cosmetics Committee has kept in close touch with the Taiwan Food & Drug Administration as TFDA drafts amendments designed to modernize the Control of Cosmetics Hygiene Act. The Committee and TFDA have been in agreement that regular two-way communication between government and industry is the best way to ensure that relevant laws and regulations are as effective and practical as possible.

In line with that goal, the Cosmetics Committee recently arranged for a U.S. expert in cosmetics industry affairs, Tonya Kemp, to visit Taiwan in late October. Kemp was formerly Senior Director of International Trade Policy at the Washington, DC-based Personal Care Products Council (PCPC), the leading national trade association representing the global cosmetic and personal care products industry. Currently she is Senior Principal Trade Policy Advisor for Amway Corp., while also serving Chairman of PCPC’s Asia Pacific Subcommittee and an Advisor to the International Trade Administration of the U.S. Commerce Department.

From left to right: Susan Chao, Managing Director, MindShare Communications Ltd., Taiwan Branch; AmCham President Andrea Wu; AmCham Cosmetics Committee Co-Chair Abigail Lin, Manager, Global Product Stewardship, Taiwan, Procter & Gamble Taiwan; Pei-Weng Tu, Director, Division of Medical Devices & Cosmetics, Food and Drug Administration, MOHW; Speaker Tonya Kemp, Senior Principal Trade Policy Advisor, Amway Corporation / Chairman of Asia Pacific Subcommittee, Personal Care Products Council, USA; Speaker Kuo-Teng Hung, Section Chief, Division of Medical Devices & Cosmetics, Food and Drug Administration, MOHW; Jen-Ni Yang, Director General, Bureau of Foreign Trade, Ministry of Economic Affairs.

Kemp was one of two presenters at a luncheon meeting of the Cosmetics Committee held at the Mandarin Oriental Hotel on October 27 on the topic of “U.S. and Taiwan Cosmetics Regulation.” Explaining the Taiwan regulatory structure was Kuo-Teng Hung, Section Chief of TFDA’s Division of Medical Devices and Cosmetics, who outlined how it will be transformed under the new law from a pre-market registration system to one of post-market surveillance through notification and the use of Product Information Files (PIF). Kemp’s presentation reviewed the American experience with post-market surveillance and the benefits of industry self-regulation.

During Kemp’s stay in Taipei, the AmCham Cosmetics Committee also arranged for her to pay courtesy calls on the Commercial Section of the American Institute in Taiwan, where she met with Deputy Director Mark Lewis and his staff, and on TFDA Director General Wu Shou-mei and her colleagues. The Director General expressed keen interest in increased contacts with PCPC to help TFDA keep abreast of international best practices.

Interested in attending our events? Join us at other upcoming events, click here.

Note: AmCham events are intended primarily for AmCham members and their guests. Many events are open to members’ guests and other non-members, but the attendance of any non-member must be approved in advance. AmCham reserves the right not to admit a non-member to any event without explanation.

“Chicago”: The 2017 American Ball

The 2017 edition of the always much-anticipated American Ball, co-organized by AmCham Taipei and the American Institute in Taiwan (AIT), took place October 28 in the beautiful Grand Ballroom of the Grand Hyatt Taipei. Guests enjoyed the room’s dazzling Chicago-themed décor provided by the Feng Ze Design Center, crowd-pleasing entertainment routines devised by the VMJ dance group, and the choice of music by energetic vocalist Dooley and his band, as well as DJ Rick Kraft.

The Master of Ceremonies was Mark Lewis, taking a break from his day job at the AIT Commercial Section. AmCham Chairman Albert Chang and President Andrea Wu, accompanied by AIT Director Kin Moy and Deputy Director Rob Forden, greeted the attendees on behalf of the host organizations.

View the full photo gallery here.

Before the reception, guests were greeted with a lively cocktail reception drink of Robert Mondavi Winery’s Woodbridge Sparkling Brut courtesy of Sergio Valente Inc. The gourmet five-course meal that followed featured smoked salmon tartare, lentil soup with papadum chip and sour cream, Tarocco Orange sorbet, roasted U.S. beef tenderloin with polenta cake and crispy carrot, and for dessert a Red “C” chocolate-origin mousse with raspberry sorbet and sea salt sable. The dinner was accompanied by Robert Mondavi Winery Woodbridge Cabernet Sauvignon and Chardonnay (from Sergio Valente) and Johnnie Walker Double Black (from Diageo). Cocktails and Guinness stout were available at the bar.

The event was made possible by the generosity of a number of sponsoring companies. These included Grand Prize Sponsors United Airlines and Grand Hyatt; Wine & Liquor Sponsors Diageo and Sergio Valente; Gold Sponsors HSBC, Grand Hyatt Taipei, and Versum Materials; Décor Sponsor Standard Chartered Bank; Silver Sponsors Bristol-Myers Squibb, BlackRock, Corning, and Prospect Hospitality Co. Ltd. (McDonald’s Restaurants); and General Sponsor The Tobacco Institute of the Republic of China (TIROC).

Substantial raffle prizes added to the excitement of the evening. This year’s grand prize, an “Ultimate Dream Vacation” package, included two round-trip Taipei to Chicago business-class tickets by United Airlines, plus a three-night stay at the Park Hyatt Chicago. Other gift sponsors were 3M, eslite hotel, Ever Rich, Grand Hyatt, Hotel Eclat Taipei, Howard Plaza, The Landis Taipei, Mandarin Oriental Taipei, Mellow Fields Taipei, Palais de Chine, The Place Tainan, Procter & Gamble, Regent Taipei, Shangri-La’s Far Eastern Plaza Hotel, The Sherwood Taipei, Westin Taipei, The Westin Tashee Resort Taoyuan, and W Taipei.

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Note: AmCham events are intended primarily for AmCham members and their guests. Many events are open to members’ guests and other non-members, but the attendance of any non-member must be approved in advance. AmCham reserves the right not to admit a non-member to any event without explanation.

Ramifications of the New Southbound Policy

Since taking office in 2016, the Tsai administration has promoted its New Southbound Policy as a key element in stimulating the Taiwan economy and providing Taiwan with more international space. What does the policy entail? Will this new direction compromise business investment in China? How will the government assist Taiwan’s corporates to expand their business to Southeast Asia and South Asia?

At a special AmCham Taipei luncheon meeting held at the Grand Hyatt Taipei on November 1, Tsai Chi-Chang, Deputy Speaker of the Legislative Yuan, gave a Chinese-language presentation explaining the basic framework of the policy and how it relates to current conditions in cross-Strait relations.

Form left to right: AmCham Governor & Telecom & Media Committee Co-Chair Joanne Tsai, Executive Vice President & Managing Director of Taiwan and China, Fox Networks Group; Tsai Chi-Chang, Deputy Speaker of Legislative Yuan; AmCham President Andrea Wu; AmCham Telecommunications & Media Committee Co-Chair Thomas Ee, Chairman, Taiwan Broadband Communications, Co., Ltd.

Tsai’s main points included:

  • Stable Relationship with China – Maintaining stable cross-Strait relations remains the government’s top priority. Promoting the New Southbound Policy is not meant to discourage Taiwanese companies from investing in China.
  • Additional Business Opportunities – The primary purpose of this policy is to increase investment options for Taiwan’s businesses.
  • Leveraging Taiwan’s Advantages – Taiwan continues to be one of the top investors in Southeast Asia, while the number of workers, students, and tourists from Southeast Asia has been growing steadily over the years. Taiwan should seize the chance to turn these relationships into a business advantage.

Economic growth remains the core goal for the government. Although there are many obstacles, the government is determined to keep improving investment environment for Taiwan’s companies.

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Note: AmCham events are intended primarily for AmCham members and their guests. Many events are open to members’ guests and other non-members, but the attendance of any non-member must be approved in advance. AmCham reserves the right not to admit a non-member to any event without explanation.