It is not enough, for either visitor or resident, to remain always in the capital city of any country. He should get out and see what makes that country tick.
Happily, I have been able to visit the Tan Eng Iron Works twice, and in an interim of two years between visits, I could see that it had made a real giant stride ahead. This is in sharp contrast to the so-called "big leap forward" of the Communists on the mainland which landed them in their own backyards, with little blast furnaces turning out inferior steel.
I came to the Isle Beautiful just ten years after the Tan Eng Iron Works was founded. So I was not an eyewitness of its beginnings in May, 1940. But I am reliably informed that it is, and always has been, a private enterprise. It is, and has been from the beginning, a family business. It is named for its founder, Mr. Tang Eng. Tang, the Elder, was a self-made man, who had come from Fukien province on the Chinese mainland when he was a teen-ager. That was about six decades ago.
Mr. Tang was in his late 50's when he started the iron works in Kaohsiung on a small scale, with less than sixty workmen. He had mostly old equipment to start with, and he had the opposition of the Japanese to contend with. They did not encourage Chinese enterprise, but he was not to be discouraged.
At first he had a re-rolling mill in a single building, which still stands today, or did when I saw the place. But now, twenty years later, the industry covers many acres with two steel-making shops, seven rolling-mills, about ten processing shops, reinforced concrete shops and copper-smelting shop. Today Tang Eng Iron Works employs around 4,500 workers, and turns out between 70,000 and 80,000 metric tons of steel products annually. This is between 65% and 70% of Taiwan's total steel production. Their exports to such countries as Thailand, Vietnam, Korea, the Philippines, Japan, Hong Kong, North Borneo and the United States constitute 90% of Taiwan's steel products export.
Success did not smile on Tang, the Elder, all the way, however. It was hard-going at the beginning, and it was hard-sledding in 1949 when the situation on the mainland was deteriorating. This was after Mr. Tang Tcheng-chung was in command.
His father's success came when in the closing years of World War II, steel products were much in demand and the Japanese were almost cut off from outside supply. But only when the Japanese surrendered, and the island was restored to China, was Mr. Tang able to expand his industry. His first big expansion project was undertaken in 1948, increasing capacity, ordering new equipment and standardizing the quality.
Since then, under the founder's son, Mr. T.C. Tang, expansion has continued, several times with US aid loans. For instance, in 1953, the wire rod mill was established with a loan of NT$4,000,000. The next year shops for continuous wire-drawing, and wire galvanizing were opened with an aid loan of NT $3,070,000. In 1957 a US$237,000 loan made it possible to install a self-provided power sub-station. The first two loans in local currency, loans from counterpart funds, have been completely repaid. The US$ loan for the sub-station proceeds with its repayments according to schedule.
To go back for a moment, Mr. T.C. Tang had his setbacks too, especially in 1949 when the Communists had the upper hand on the mainland, and a grave financial crisis struck Taiwan as a result. Many factories closed down. Beset by a combination of drought and power-shortage, the Tang Eng Iron Works joined the plants which had suspended operations.
Before long, however, the provincial government under Governor Chen Cheng (now vice-president and premier) encouraged private industries and persuaded local banks to make loans enabling the iron works to clear its debts, and resume production. By 1951, the industry was hitting its stride of rapid progress.
Starting with steel scrap, the electric arc furnaces turn out standardized steel in the form of ingots. These are passed on to the rolling-mills to be processed as square, ribbed, round or flat steel bars; as bolts, nuts, rivets, spikes and fish-plate or rails for Taiwan's Railway Administration; as spring-steel leaf material, high tensile wires, stay-wires or wire mesh. All of this I saw on my first visit.
One of the most fascinating sights is watching the workmen feed heavy steel bars through a series of machines, each one red-hot, and to see them extrude finally as elongated molten rods which are thrown on the factory floor writhing like so many livid snakes to roll into a gutter or trough at the side, which holds them straight while they cool off.
In one shop on the grounds, I watched steel rods further processed into bolts and nuts, rivets and spikes. In another shop, wire rods were drawn into black steel wire of various gauges (from BWG #5 to BWG #22), part of which was to be zinc-coated in the galvanizing shop. Nails from ½-inch to 6-inches are an important export item. In the copper-smelting shop, from 1200 to 1500 metric tons of copper wire a year are made from copper scrap. Copper cable is made in the stranding shop, and rubber-insulated wire in still another processing shop.
Concrete poles produced by Tang Eng are loaded for delivery. (File photo)
The company makes concrete poles for power-lines, reinforced concrete pipe, and reinforced concrete piling for under-water use. These are made by a centrifugal spinning process which turns them out with hollow centers. This produces the densest possible concrete, and since it must be strong enough for sea-water construction, high standard testing equipment is maintained. In fact, the factory has its own physical and chemical laboratories for rigid testing of all their products according to international specifications. The high quality of the TE brand is now known throughout Asia.
The concrete telephone poles are first steam-cured, and then thrown into what looked like a fine big swimming pool for employees, but was in reality the place for water-curing. While this part of the great establishment did not seem to be "iron works," I am sure a whale of a lot of their steel rods go into reinforced concrete pipe and piling.
In 1958 when I was on an island-wide tour, I had a chance to visit the Tang Eng Iron Works again. I wanted to see the new power-tillers I understood they were making for the farmers of Taiwan. These 5-h.p. tillers are new in recent years on Taiwan and a great boon to the farmers, helping him to take giant strides as compared to the water-buffalo's pace. It will take at least 20,000 of them to fill the island's need, and Tang Eng (not the sole producer) can manufacture 3,600 per year. When local needs have been met, they can be exported to Manila, Thailand, Okinawa and Korea—Taiwan again taking the lead in new and improved methods of agriculture.
To expand the power-tiller project, Tang Eng Iron Works had again to draw upon foreign aid from the Development Loan Fund thus implementing its purpose to reduce tilling costs and increase farm production by turning out the annual number mentioned above.
Other recent developments have included the manufacture of bogie trucks, fabricating two sets into a 40-ton freight car which have been road-tested now for more than a year.
Unlike previous loans guaranteed by the Bank of Taiwan, a new arrangement directly negotiated between Tang Eng interests and the Commercial Metals Coin Co. of Dallas, Texas, provides for 9,500 metric tons of scrap steel from USA to be repaid over a period of 18 months at an interest of 6% per annum by steel bars to be processed from the scrap. Such an agreement is mutually beneficial.
The contract referred to above is on a long-term basis, during which Commercial Metals Coin Co. will continue to furnish scrap steel and receive its interest in processed steel bars. Another foreign investor, Overseas Central Enterprise, Inc. has invested nail-manufacturing equipment in Tang Eng, and in return has received priority rights to market TE brand nails on the American market.
On this later visit to the Tang Eng Iron Works, I learned that the company had added a fifth 10-ton electric-arc furnace, besides having one 8-ton and two 4-ton furnaces. The amazing thing was that, while the others were all of Japanese manufacture, this fifth 10-ton giant was of their own production, patterned after the Japanese ones, but made right there in their own iron works.
Mr. Tang Tcheng-chung, son or the founder, now runs the company. He visited the United States in 1959 to learn about factory management. (File photo)
I noted a couple of new buildings which had been added also since my earlier visit. One was (at a guess) about 100 feet long by 60 wide. This, I was informed, had been made from scrap sheet-iron. Mr. T. C. Tang's secretary, escorting me around (for Mr. Tang was attending a conference in Europe at the time), asked:
"Do you see some holes in the corrugated metal sheets covering that new steel-frame building?"
I looked more carefully.
"Yes," I said, "now that you mention it, I can see some holes."
"We are proud to say," he replied, "that we covered all four sides of that building with scrap sheet-iron."
The hard-working, Horatio Alger-type, Tang the Elder is now 79 and retired from the active management, but still Chairman of the Board. As the factory was modernized, expanded, products standardized, and markets abroad found for their products, Mr. Tang Eng in 1944 turned the management over to his son, Mr. Tang Tcheng-chung, who had entertained me at lunch on the first visit, but was now abroad.
"T.C.," now 56, has always been a hard worker like his father, and—like his father—is proud it is a family business. He has, of course, had more education. He knows the modern methods of technology and marketing.
But his philosophy is similar to his father's. He believes industry is a public service; that it contributes to the people's livelihood, which was one of Dr. Sun Yat-sen's Three Principles. It increases job opportunities for the local community, and it adds to the government's revenue through its taxes. His father started from scratch-and from scrap. At that time, twenty years ago, there were fewer than 60 workmen. Today on the 30 hectares (74 acres) of land the factory buildings employ some 4,500 workers, both men and women.
"T.C." does not say whether it is a disappointment that his only son is not entering the business. The boy chose medicine, has now finished his studies, and was recently married. In keeping with his position in the community, Mr. T.C. Tang gave the boy a wedding that sounded like a Hollywood affair in Chinese style.
Something of the same generous hospitality characterizes Mr. Tang's public relations and the goodwill existing between management and labor. Twice I have been the recipient of the hospitality. On the second visit, although Mr. Tang was abroad, his wife—a motherly—looking woman with considerable business ability and an active participant in the family business—entertained a group of us who were visiting the plant as foreign correspondents.
It was a long and delicious Chinese feast, with both rice wine and French cognac flowing freely. A small orchestra of Tang Eng employees furnished background music throughout—sometimes not restricted to the background. Three young women—all employees—with surprisingly good voices sang a number of solos and were heartily encored. (It seems that one of our party entertained his fellow-newsmen with songs in the night, from good memory or too much cognac, who can say?) In any case, public relations of the Tang Eng Iron Works were in fine fettle.
Because of the improved investment climate on Taiwan today, Tang Eng Iron Works looks forward optimistically to a bright future. Without talking about "big leaps forward," it will continue to take giant strides forward in step with the many other forms of industry expanding on an island once known primarily for its natural beauty.