FDI in Taiwan

Overview by Globlatrade.net:

FDI in Figures

Taiwan is an important destination for Foreign Direct Investment (FDI). In terms of FDI attraction, the island is the sixth among East-Asian, Southern and South-Eastern economies, behind China, Hong Kong, Singapore, India and Thailand. The island enjoys strong growth sustained by the dynamism of the region, a population with high purchasing power and economy with high technological focus. Between 2005 and 2007, Taiwan registered a significant growth of FDI, however, due to the international financial crisis, FDI inflows fell sharply in 2008 and 2009. Thanks to the economic recovery, the number of FDI projects increased again in 2010 and this trend is expected to continue over the year 2011.

Foreign Direct Investment 2007 2008 2009
FDI Inward Flow (million USD) 7,769 5,432 2,803
FDI Stock (million USD) 48,640 45,458 48,261
Performance Index*, Ranking on 141 Economies 114 116 122
Potential Index**, Ranking on 141 Economies 22 22 -
Number of Greenfield Investments*** 63 87 87
FDI Inwards (in % of GFCF****) 9.0 6.4 6.2
FDI Stock (in % of GDP) 12.4 11.3 12.7

Source: UNCTAD

Note: * The UNCTAD Inward FDI Performance Index is Based on a Ratio of the Country's Share in Global FDI Inflows and its Share in Global GDP. ** The UNCTAD Inward FDI Potential Index is Based on 12 Economic and Structural Variables Such as GDP, Foreign Trade, FDI, Infrastructures, Energy Use, R&D, Education, Country Risk. *** Green Field Investments Are a Form of Foreign Direct Investment Where a Parent Company Starts a New Venture in a Foreign Country By Constructing New Operational Facilities From the Ground Up. **** Gross Fixed Capital Formation (GFCF) Measures the Value of Additions to Fixed Assets Purchased By Business, Government and Households Less Disposals of Fixed Assets Sold Off or Scrapped.


FDI Inflows By Countries and Industry

Main Investing Countries 2009, in %
USA 20.0
The Netherlands 17.3
The Carribean 17.1
Japan 15.4
UK 6.0
Singapore 5.4
Hong Kong 3.9
Main Invested Sectors 2009, in %
Finance and Insurance 46.6
Manufacturing sector 20.6
Whole sale and retail trade 13.8
Real Estate 5.2
Form of Company Preferred By Foreign Investors
Public limited company.
Form of Establishment Preferred By Foreign Investors
Joint venture in the case of a partnership.
Main Foreign Companies
Alstom, Daewoo International, Dassault Aviation, Intel Microelectronics Asia Ltd, Levi Strauss USA LLC, American Express Bank Ltd, etc.
Sources of Statistics
National statistics

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Why You Should Choose to Invest in Taiwan

Strong Points
The country's strong points are:
- A consideralble industrial and logistical fabric;
- An abundance of a skilled labor force;
- Strong R&D capabilities;
- An emerging capital market;
- Efficient logistics operations;
- A strategic geographical location, the country is an entryway to China and the ASEAN markets.
Weak Points
The country's weak points are:
- The lack of a direct communication path with China;
- A limited domestic market.
Government Measures to Motivate or Restrict FDI
New taxation regulations for foreign professionals in Taiwan came into effect at the beginning of 2008, as according to an announcement made by the Ministry of Finance (MOF).

The new regulations provide preferential tax incentives to foreign professionals employed in Taiwan, and are aimed at improving the overall environment for recruiting and attracting professionals from other countries. The regulations, which address a general shortage of professional talent, are expected to benefit up to 3,000 foreign professionals in Taiwan.
More information can be obtained on the website of Invest in Taiwan.

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