Monday, March 13, 2017

Chugging along the coast (Travel in Taiwan)

Taiwan is an island, but it’s easy to ignore the sea which surrounds it. Many visitors fly into Taiwan Taoyuan International Airport and head first for Taipei. After taking a look at Sun Moon Lake, Alishan and Tainan, they may not glimpse the ocean until they reach Kaohsiung's Former British Consular Residence. A good number make sure their itinerary includes Kenting National Park and/or Taiwan’s gorgeous east coast, but it takes a special effort to see any of the west coast.

It can be done, however. And thanks to Taiwan Railway Administration (TRA), there’s no need to rent a car. For over 100 years, the TRA has provided essential and inexpensive transportation throughout the island. The high-speed railway (HSR), launched in 2007, now handles a lot of north-south traffic, but tourists often use TRA services to get to places like Keelung and Hualien.  

Not all of the TRA expresses which zip north to south follow the same route. Just outside Zhunan in Miaoli County - an hour and a half down-island from Taipei - the main line bifurcates. One set of tracks takes a more direct southward route, through the booming metropolis of Taichung. Another less-traveled railroad follows Miaoli County’s coastline, and it’s to this area I was sent recently by Travel in Taiwan.

Whether you tour coastal Miaoli from north to south or the other way around may depend on what you have planned for the end of the day. Getting from Zhunan to Miaoli HSR Station (from where it’s 43 minutes to Taipei, and a mere 17 minutes to Taichung) is a cinch, thanks to regular TRA services to Fengfu (travel time: 10 minutes), the stop adjacent to the bullet-train station. But in this article we’re going south to north, because we like to begin with a full stomach. 

Yuanli (35 to 48 minutes from Zhunan, NT$61 to 85 one way) is an excellent place to enjoy the morning markets which are still a key feature in urban areas. Less than 100m from Yuanli’s railway station, a block bordered by Weigong Road, Tianxia Road and Datong Road is crammed full of vendors. Some sell vegetables, others sell fabrics. The range of hot and cold snacks is enticing. One especially popular option is the glutinous, pork-filled disks at Jinguang Meatballs (open daily 8 am to 9:30 pm).

In the days of yore, triangle-rush weaving underpinned Yuanli’s economy. The industry is celebrated at Triangle Rush Weaving Exhibition Hall, 5.5km southeast of the station. 

One stop and six minutes north of Yuanli lies Tongxiao. Stopping here is recommended, as both fresh-air freaks and history buffs can indulge their passions in Hutoushan Park. 

This isn’t the only place in Taiwan literally called “tiger’s head mountain.” There are others in Taoyuan, Nantou and Tainan - surprising when you consider that the sabre-toothed tigers which once roamed Taiwan were extinct long before humans settled the island. At Tongxiao’s Hutoushan, the reward/exertion ratio is very much in your favor. The top is just 700m from the railway station, and even if the weather isn’t absolutely clear, you’ll be able to see up and down the coast, and inland across foothills as far as the majestic peaks of Shei-Pa National Park.

First, you’ll see the remains of a Shinto shrine (pictured above) built in 1937 by the Japanese authorities then ruling Taiwan. After World War II it was preserved, but rededicated to heroes of the Nationalist Republic of China (ROC), the government which reclaimed Taiwan in 1945. Despite earthquake damage and modifications which reflect postwar political correctness (among them a Chinese Nationalist “white sun” emblem on the roof), it retains considerable elegance.

A little further up, what was once a military lookout post is now shaded by an immense concrete lotus. In Buddhism, the lotus flower is a symbol of purity, so this is perhaps an attempt to counter the site’s military atmosphere with peaceful sentiments.

At the very top of hill, there’s a monument which since 1945 has celebrated Taiwan’s return to the Chinese fold, but which was originally erected by the Japanese to mark a crucial moment in the Russo-Japanese War of 1904-05. 

Getting to the next railway station takes just five minutes, but as the gap between services on this stretch of railroad often exceeds an hour, do carry with you a list of train times. These can be found on TRA’s bilingual website...

To read the full article, go here and scroll forward to page 57 of the electronic version of Travel in Taiwan's March-April issue.

Saturday, February 18, 2017

The Evolution of Wuling Farm (En Voyage)

People head to Wuling Farm to enjoy nature at its very best, but much of what makes this high-altitude retreat so alluring is the result of carefully thought-out human intervention. The farm occupies a valley deep in Taiwan’s mountainous interior. No part is lower than 1,740m above sea level, and from it hikers set off for the summit of Snow Mountain, which at 3,886m is the second-highest point on the island. 

Some of the scenes which greet visitors in 2017 are quite different to those of a generation or two ago. Just as the palisade from which Wall Street gets its name eventually disappeared, agriculture is no longer one of Wuling Farm’s main reasons for being. But before explaining why that change has occurred, we should outline the farm’s history.  

Members of the Atayal tribe, one of Taiwan’s indigenous Austronesian ethnic groups, hunted and gathered here for centuries. The outside world finally arrived in the early 1960s when the valley was identified by the government as a place where some of the many thousands of servicemen who’d followed Chiang Kai-shek from mainland China in 1949 could be resettled.  These soldier-pioneers cultivated cabbages and built stone cottages. Several of the latter still stand, and it’s possible to arrange an overnight stay in one. Accommodation details and other useful information can be found on the farm’s bilingual website.

Around this time, the valley gained its current name. Wuling is the name of a place mentioned in Peach Blossom Spring, a prose work by Tao Yuanming, a poet who died almost 1,600 years ago. This classic of Chinese literature concerns a man who loses his way, follows a stream, and comes across a sublime grove of peach trees. Continuing onward, he discovers an idyllic yet secluded community. Receiving a warm welcome, he stays for several days. When he eventually returns home, he tells the local magistrate what he found, but despite the sending out of numerous search parties, no one is able to relocate the utopia. 

Taiwan’s Wuling, by contrast, is very easy to find. Motorists can approach via Hehuanshan (this stretch of road is the highest on the island, ascending to an altitude of 3,275m) or from Yilan in the northeast. Driving to the farm from Taipei takes just over three hours.

Soon after the farm was set up, the managers realized good profits could be made growing fruits which can’t thrive in Taiwan’s sultry lowlands. Apple, pear and - fulfilling a prophecy implied by the valley’s new name - peach orchards were established. Red and green maples were added to the landscape, as were Chinese cork oaks and sweetgums. Together with native Formosan Alders and walnuts, these trees offer fall visitors an astonishing range of yellows, oranges and reds. Those who arrive around the end of winter are treated to gorgeous displays of cherry and plum blossoms.

It’s still possible to buy locally grown fruit at Wuling Farm, but since 2003 many of the orchards have been replaced with stands of native trees. Shei-Pa National Park, which oversees the valley as well as pristine highlands to the north, south and west, is particularly keen to preserve species like the Taiwan red pine, the Taiwan Hemlock  and the Taiwan Douglas fir. Where fruits (and tea) are still grown, pesticides and artificial fertilizers are no longer used. 

Many of these changes have been made for the sake of a fish, and 2017 marks the centenary of its discovery by scientists. A hundred years ago, while visiting a police station in the area, an assistant to Japanese scientist Oshima Masamitsu was told that fish somewhat similar to trout could be found in several high-altitude streams in this part of Taiwan. With the help of some Atayal – who called the species bunban or kulubang – the assistant obtained a salted tail of one fish.

After further research, in 1919 Oshima published a description of the fish scientists now call Oncorhynchus formosanus. The second part of the name, you’ll likely guess, derives from Formosa, the name by which Taiwan was known in the Western world between the 16th century and the mid-20th century. In terms of appearance and habits, Oncorhynchus formosanus isn’t exceptional. They seldom live more than four years, and few are longer than 40 cm. The mere fact they’re endemic - meaning they’re found nowhere else on Earth - isn’t really that special. Of Taiwan’s 220 freshwater fish species, 36 are unique to the island. 

What’s commonly called the Formosan landlocked salmon isn’t just rare, but also the world’s southernmost salmon species, and the one surviving at the highest altitude. For these reasons, both scientists and the Taiwanese public regard it as extraordinarily precious. Its status as a national icon was cemented in 2002 when it appeared on Taiwan’s new 2,000-dollar bills.

What makes this type of salmon landlocked isn’t a lack of access to the sea, as you might assume, but rather the species’ intolerance of warm water. Its eggs cannot hatch if the water’s temperature goes much above 12 degrees Celsius, and mature fish begin to suffer from fungi and bacteria when temperatures top 17 degrees Celsius. 

Official efforts to bolster the Formosan landlocked salmon date from the 1980s, by which time the population in the wild had fallen below 300. Formerly abundant in six tributaries of the Upper Dajia River, which drains into the Taiwan Strait 67 km west of Wuling Farm, the salmon now thrives only in Qijiawan Creek (pictured here). 

This stream, 15.3 km long and never more than 12m wide, is one of the valley’s scenic focal points. Whether you pause at the road bridge near the entrance to the farm, or the crossing which leads to Taoshan Waterfall (three hours’ walking will get you there and back), you’ll likely find this waterway so attractive you’ll loathe to tear yourself away.

The weirs which once punctuated the Qijiawan are gradually disappearing. One was destroyed by a typhoon, but five others were removed by the national park after scientists concluded they were made the stream run slower (and thus warmer), and impeded the salmons’ breeding. Thanks to these and other measures, the wild salmon population has recovered to over 3,000. Live, artificially hatched salmon are on display in the Taiwan Salmon Eco Center (which has more than one English name, and is closed on Mondays), as are Taiwan shovel-jaw carp, another species which makes its home in the creek.

A few salmon and carp fall victim to the valley’s Tawny fish owls. This bird, Taiwan’s largest owl, isn’t seen nearly as often as the local population of Taiwan partridges, Brown dippers, and Plumbeous redstarts.

Just as the valley has rare fish and unusual birds, it also boasts a stunning range of flowers. More than 270 species have been recorded, and March is said to be when the farm’s wildflowers are at their best. This coincides with the fruit-tree blossoms. Those who come a little later in the year will be treated to exuberant rhododendrons, while after late July golden needle flowers (also known as day lilies) are a highlight. There are no bad times to visit Wuling Farm - only bad times to forget your camera!

Because En Voyage is currently a print-only publication, I've posted the entire article.

Friday, February 17, 2017

Tainan, original Taiwan

This is the cover of an eight-page booklet recently published by Tainan City Government's Tourism Bureau, for which I wrote the text (just a few hundred words) late last year. The tricky part was conveying so much information (for instance, that Tainan's history includes Austronesian, Dutch, Qing and Japanese episodes) in so few words. I enjoy this kind of challenge, and have written quite a few tourism-related advertisements in recent years. It's quite different to writing advertorials, as the latter are very like feature articles, except you're required - to quote the song - to "accentuate the positive, eliminate the negative... latch on to the affirmative." 

Sunday, February 5, 2017

Hubs of Collaboration (Taiwan Review)

The number of people in Taiwan who work remotely for major employers is minuscule compared to the US or the UK, but the country does have a growing cohort of freelancers and self-employed specialists who see no reason to rent or equip a conventional office. Many of the latter work from home, but some take advantage of a type of establishment that did not exist before the internet age: the co-working space.

Unlike in conventional offices, those who toil in co-working spaces seldom share employers or even similar goals. They also have very different reasons for paying the membership fees that entitle them to sit there all day—and maybe all night—making the most of the ultrafast Wi-Fi.
Some do it because they find the atmosphere motivational. “Seeing other people working hard helps me concentrate on what I need to do,” said Marvin Kuo, a software coder and regular at Tsohuespace in southern Taiwan’s Kaohsiung City. “If I stayed at home, I’d waste half the day watching movies.”

Freelancers whose home environment is conducive to productivity are sometimes attracted to co-working spaces because they want to clearly separate their work from their free time. Still others hope to network with people whose skills complement their own. This kind of cross-pollination is one of the goals of SD Coworking Plaza in Taipei City.

The facility currently has 10 regular users, and three or four others who come occasionally. “We’ve financial specialists, bloggers, programmers, a manga artist, startup owners and e-traders,” said Tsai Yi-ting, one of the three co-owners. “We aim to increase the variety of our co-workers to make cooperation and creativity among members more likely.”

SD Coworking Plaza is accessible to members 24 hours a day, seven days a week. It also offers ergonomic work chairs, unlimited coffee and tea, a microwave and oven, as well as lockers and an en suite room that members can rent when they need to stay overnight. “We’ve invested around NT$2 million [US$62,895], but we feel it’s worth it when our members say, ‘This is the kind of place we dreamed about for so long,’” Tsai said.

Like their counterparts at SD, the founders of Happen in central Taiwan’s Taichung City [where the photo above was taken] wanted to create a platform that could encourage collaboration. “Happen is a space where people can exchange ideas and professional skills,” explained Sandra Chan, project manager at the establishment.

Founded in November 2013, the co-working space occupies the first and second floors of a 70-year-old house in the heart of the municipality. “As well as gadgets like a printer and scanner, we have a shared kitchen so people can prepare their own drinks and snacks, a tatami area where they can take a nap, and shower facilities,” Chan said. Tatami is a type of Japanese-style straw mat. According to Chan, satisfying the legal and licensing requirements for co-working spaces was not difficult. “We’re treated the same way as rented offices, coffee shops and event venues. We’ve passed the fire safety inspection, and we have insurance.”

Afternoons are when Happen is busiest, but it is possible to buy a “workaholic” membership, which allows access 24/7. Conventional members are restricted to Happen’s regular hours of 9 a.m. to 7 p.m., Monday to Friday. “We’ve had 82 co-worker members since we opened,” the project manager said. “Most of them are doing design or engineering work, or programming or online marketing.”

Recently, Happen has been collaborating with the Taichung City Government to assist startups. “We’ve expanded our business model to include projects that focus on local culture, and to incubate startups,” Chan said. “We’ve incubated 25 teams over the last two years. Most of them are businesses focused on local culture, or social innovators.”

In Kaohsiung, the local government has played a more direct role in the establishment of co-working facilities, overseeing the transformation of an abandoned public retail market into a base for entrepreneurship and innovation called Digital Art Kaohsiung United Office (DAKUO)...

This article appeared in the January-February issue of Taiwan Review, which is now a bimonthly rather than monthly publication. The whole piece can be read online here.

Wednesday, January 18, 2017

Fungus Among Us – The History of Mushrooms in Taiwan (Taiwan Business Topics)

We eat too much of what is bad for us, experts say, and not nearly enough fruits and vegetables. But one positive trend is visible in some parts of the world: People are eating more mushrooms than they did a generation or two ago. That is good news from a nutrition perspective because many types of mushroom contain vitamins (especially B1, B2, B3, and B6) as well as iron, selenium, and other minerals. They are rich in antioxidants that can survive cooking, and there is some evidence mushrooms have cancer-fighting properties.

Global mushroom cultivation grew tenfold between 1981 and 2002. Since the mid-1960s, annual per capita mushroom consumption in the United States has risen from 0.7 lbs to 3.7 lbs. In recent years, fresh mushrooms account for three quarters of this total. Precise data on mushroom consumption in Taiwan is hard to find, but anecdotal evidence points to a steady increase. Edible fungi find their way into hot pots, stir fries, and soups, as well as the “mock meats” eaten in vegetarian restaurants.

In Taiwan, the systematic cultivation of fungi dates back over a hundred years, with many of the original techniques introduced by the Japanese during the 1895-1945 colonial period. However, the industry did not properly take off until the late 1950s, after domestic shortages prompted the U.S.-ROC Joint Commission on Rural Reconstruction (JCRR) to expand local mushroom production.

Early trials were conducted in mountainous areas such as Xibao (915 meters above sea level, and now within Taroko National Park), but very soon farmers in the west-central region came to dominate production. According to a report prepared for the Federal Reserve’s Division of International Finance, the American economic aid program (USAID) provided US$82,574 to help develop sanitary harvesting and canning practices, as well as for the construction of processing facilities. The return on this investment was fantastic. “Taiwan first began to export canned and bottled mushrooms on a regular commercial basis in 1960,” states the report. “By 1963, Taiwan had become the world’s foremost exporter of mushrooms…supplying one-third of the total amount of mushrooms imported by all countries.”

About 80% of the canned mushrooms sold in the United States in 1963-64 were from Taiwan. Annual exports of canned mushrooms peaked in 1978 at US$120 million, before Chinese and South Korean growers ate into Taiwan’s share of the global market.

In 2013, the Council of Agriculture’s Taiwan Agricultural Research Institute (TARI) estimated that the industry’s annual sales had reached US$295 million. In recent years, fungus farmers have been shipping around 140,000 metric tons of produce annually to domestic and overseas buyers. Relatively few farms now concentrate on the species that kick-started the boom – the humble Agaricus bisporus, also known variously as the common white mushroom, button mushroom, or champignon mushroom.

Frank Tai and his cousin Chu Rui-Jong are second-generation mushroom farmers in Taichung City’s Wufeng District. Both men grew up helping their parents cultivate button mushrooms, which Taiwanese often call “Western mushrooms” (yang gu, 洋菇).

“Wufeng has the right conditions for successful mushroom farming,” says Chu. “Northern Taiwan is too humid and the south is too warm, but the Taichung area is ideal.” Local weather patterns no longer matter much, however, as both men’s operations are now more like food factories than traditional farms. Growing the mushrooms indoors enables them to fully control temperature and other factors.

Their families, and hundreds of others, have benefited from the presence in Wufeng of TARI’s Edible and Medicinal Mushroom Laboratory. Among the laboratory’s many contributions are introducing the king oyster mushroom (xing bao gu, 杏鲍菇) – currently one of Chu’s principal crops – to Taiwan from France and devising ways in which this unusually sensitive fungus can be protected from micro-organisms.

Tai, who was born in 1970, graduated from Soochow University’s Department of Microbiology, choosing this major knowing he would eventually manage the Tai Mushroom Farm, currently Taiwan’s number-one producer of enoki mushrooms (jin zhen gu, 金针菇). He also grows shiitake (xiang gu, 香菇) and shimeji (liu song gu, 柳松菇) mushrooms. Until it was overtaken by growers in China, the Tai Mushroom Farm was regarded as Asia’s largest in terms of output...

This is the second of our articles in the Wine & Dine 2017 special issue. To read all of it, go here. To see the first (on guabao), follow this link. I took the photo at Wufeng Story House, near the Frank Tai and Chu Rui-Jong's mushroom farms.

Tuesday, January 10, 2017

Getting a Handle on the Taiwanese Hamburger (Taiwan Business Topics)

Compared to the cult-like veneration of beef noodles, hot pot, and stinky tofu in Taiwan, the guabao is an underappreciated snack. What English-speakers often call “the Taiwanese hamburger” is available in every town and city, but certainly not on every street, nor even in many night markets.

Because of their shape, these hearty delights often appear in weiya banquets, traditional end-of-the-year feasts at which Taiwanese bosses treat their employees. According to some, a generously proportioned guabao bears an auspicious resemblance to a purse overflowing with money. The way in which the bun envelops the pork has also inspired a nickname which some vendors have embraced: hu yao zhu (pronounced ho ka ti in Holo, “tiger bites pig”).

Some foodies steer clear of guabao because they think neither of the main ingredients – pork belly and steamed bread – is especially healthful. The meat, while exceptionally tender and juicy, is heavily marbled with fat. To people who believe whole-wheat bread is better for you than loaves made of bleached flour, the shiny whiteness of the wrap suggests it offers nothing but carbohydrates. Those who abstain may be right, yet over the past six or seven years the popularity of guabao in the Western world has leapfrogged that of other Taiwanese dishes.

And truly Taiwanese it seems to be, too. There is a theory, though not a widely held one, that a meat-filled, steamed cut bun called roujia mo (literally “meat pressed into a small loaf”) popular in the mainland Chinese province of Shaanxi made its way to Fujian and eventually to Taiwan. Fujianese cuisine does have something called khong bah pau (Holo pronunciation; kong rou bao in Mandarin), but nothing is added to the meat and bun but celtuce (also known as Chinese lettuce).

Taiwanese guabao, by contrast, almost always incorporate fresh cilantro, pickled mustard greens, and a dusting of crushed peanut. “These three components extend the dimensions and depth of the dish tremendously, making it so much more interesting,” gush Singaporean bloggers TravellingFoodies. “The regular [khong bah pau] taste rather plain and run-of-the-mill in comparison.”

Just as it is hard to image an American-style hamburger without lettuce, tomato, onion, and perhaps a pickle, many Taiwanese assert that if a guabao is to be considered authentic, peanut powder is an essential element.

Guabao is similar to the Mexican dish carnitas soft taco in that the protein in both is slow-cooked pork. However, whereas carnitas is pulled apart by hand or shredded, most guabao feature a single slab of deliciously soft meat about the size of a deck of playing cards. Taiwanese usually call this kong rou (khong bah in Holo). Beyond Taiwan and Fujian, common names for pork cooked this way include hongshao rou (“braised pork”) or dongpo rou (featured in many cookery books as “Dongpo pork”). A few vendors advertise their guabao with the Holo term for uncooked pork belly (sa chan bah; in Mandarin this cut is known as wuhua rou). Not just any chunk of pork belly will do. The meat should not be too lean, to ensure it does not become dry and fibrous after braising. The meat is cooked in a thick gravy that typically includes soy sauce, rice wine, and often sugar...

This is an extract from the first of what I expect to be several articles co-written with Katy Hui-wen Hung (who also provided the photo above), with whom I'm working on a major food related project. The entire article can be read online here.

Wednesday, December 21, 2016

Taiwan’s Export Processing Zones: Forward-looking at 50 (Taiwan Business Topics)

Free trade zones of one kind or another have been around since at least the 1930s, but when the Taiwan government created an export-processing zone (EPZ) in Kaohsiung in December 1966 – half a century ago this month – it was still a very bold move.

“Two major psychological barriers and a number of minor problems had to be overcome before the idea evolved into an actual program,” the late K. T. Li, the technocrat given much credit for Taiwan’s economic transformation, wrote in his 1988 book The Evolution of Policy Behind Taiwan’s Development Success.

The first obstacle was that “resentment of the extraterritoriality (freedom from local jurisdiction) enjoyed by foreigners in prewar China created opposition to both free trade zones and EPZs,” said Li. “Although it is true that the zones allowed investors to operate under a different set of rules than those outside – which was the whole point – they were nonetheless [Taiwan’s] rules.” The second barrier was the fear of exploitation – “the sale of relatively cheap Taiwanese labor for the enrichment of foreign investors,” as Li put it.

There was also a concern that companies inside the EPZ would have an unfair advantage over exporters operating outside the zone. But as Li pointed out, enterprises that invested in the EPZ had already established their export markets, so they posed little threat. “Indeed, during the early years they helped promote Taiwan as a supplier of light consumer goods and not merely as a source of agricultural products,” Li explained. “In fact, after visiting factories located in the EPZs, foreign buyers would necessarily come to Taipei to examine products produced by firms outside the EPZs. In this way, new business connections were established. Consequently, I have always regarded the EPZs as showcases for our industries.”

The EPZ was created just as Taiwan was beginning its export-driven economic takeoff, and it became a source of national pride. Among early investors in the zone were companies that helped established the foundations of Taiwan’s information, consumer electronics, optics and TFT-LCD industries, including Philips Electronic Building Elements Industries (now known as NXP Semiconductors Taiwan Ltd.), Hitachi, and Canon.

According to an August 1972 report, of the 161 factories in Kaohsiung’s EPZ, 37 were electronics manufacturers, 23 made textiles, 21 produced handicrafts, and 14 were garment manufacturers. Only the first of these sectors is still important. Nowadays, the EPZs’ most important tenants are semiconductor testers-and-packagers and LCD companies. Electronics production no longer means TVs and radios, but flat-panel displays for mobile phones and components for photovoltaic arrays. Intangible goods like apps, as well as animation and cloud-computing services, are coming out of the zones’ software parks.

Over the years, EPZ tenants have became important customers for Taiwanese companies outside the zones. Back in 1967, a mere 2.1% of the inputs shipped into Kaohsiung’s original export-processing zone were of local origin. By 1973 that figure had risen to 17%, and in the 1980s it reached 33%. Last year domestic inputs equaled 48% of the zones’ total export value, according to the Ministry of Economic Affairs’ Export Processing Zone Administration (EPZA).

Today several hundred export-processing zones operate around the world, and many of those set up in the 1970s and 1980s were directly inspired by Kaohsiung’s success. The original site, a 68.3-hectare plot next to the city’s harbor, filled up so quickly with factories that within five years new zones had been designated in what are now Taichung City’s Tanzi District and in former sugarcane fields in Kaohsiung’s Nanzi District.

Between late 1967 and 1976, total employment in the zones grew 13-fold. Since then, the number of workers has fluctuated, but the current tally of 81,045 (12.4% of whom are foreign nationals) is the highest it has been in this century. The most recent nadir was in 2009, when employment came to 58,002. In addition, the workforce is far better educated than ever before, with recent data showing that 7.5% of zone employees hold graduate degrees.

First-mover advantage was one reason for the EPZs’ initial popularity with investors. In a 1992 issue of Asian Survey, Canada-based academics Jing-dong Yuan and Lorraine Eden wrote: “EPZs in Taiwan and South Korea were established in the late 1960s when the first wave of global industrial restructuring was taking place. A new international division of labor was created as multinational enterprises in labor-intensive, non-complex, light industries began to move offshore to reduce production costs… There were few other countries with EPZs, so they faced little direct competition.”

As Yuan and Eden explained: “Both countries had already achieved a measure of economic growth by the late 1950s so that labor-intensive industries were relatively well developed, making it possible for zone enterprises to establish linkages with domestic producers.” Japanese colonial rule was a recent memory in both countries, making them “natural sites for Japanese FDI.”

Half the NT$138.2 billion total foreign investment in Taiwan’s EPZs between their creation and October 2016 came from Japan, according to EPZA data. Although the zones’ contribution as a proportion of the island’s exports has declined since 1974, when they stood at just over 9%, the 2014 figure of 4.7% was the highest for some years. Cumulatively, exports from EPZ tenant enterprises have earned Taiwan around US$76 billion.

The EPZA now supervises seven EPZs, a logistics park, and two software parks. In all, they cover 530.3 hectares. The number of tenant companies now totals 602, up from 568 at the end of 2013. Manufacturing tenants pay a service charge of 0.08% to 0.22% of turnover (to reward success, the rate is regressive).

Both software parks have made notable progress. Total sales volume of the Kaohsiung Software Park approached NT$15 billion in 2015, 30% higher than in 2014, and 100% of the land (but not all of the office space) in the Taichung Software Park has been rented out. In the past, the zones offered a very different business environment compared with the rest of Taiwan. The infrastructure was better and the paperwork less onerous, but until 1986 the tenant manufacturers were required to export everything they produced.

The science parks in Hsinchu, Taichung, and Tainan nowadays enjoy a higher profile than the EPZs, but the former undoubtedly benefited from Taiwan’s experience with the latter. "The statute for the establishment and administration of the science parks, as well as the systems of one-stop services and factory-building land, are all copied from the export-processing zones," says EPZA Director-General Huang Wen-Guu.

Even though the rest of the island has caught up in terms of simplified procedures and efficient transportation links, the EPZA still strives to accommodate every qualified investor. "The main challenge is that we lack space," says Huang. "We need to expand, or figure out how to relocate older buildings to make space..."

To read the whole article online, follow this link. To see the article I wrote about Taiwan's EPZs half a decade ago, go here. The photo is courtesy of, and shows a new factory belonging, Advanced Semiconductor Engineering, one of the zones' key tenants.