The past week has been filled with good economic news for Taiwan; announcements of closer cooperation between the island and longstanding partner Japan dominated headlines, buoying hopes of healthier bottom lines for the local manufacturing and technology sectors in the days ahead.
On July 2, ROC government economic officials and corporate representatives from Japan met in Taipei City to review the latest white paper issued by the Japanese Chamber of Commerce and Industry. In addition to discussing recommendations contained therein, participants brainstormed ways of capitalizing on shared economic and industrial strengths to pursue win-win opportunities in the Asia-Pacific region.
The tie-up with Japan provides real hope that both sides can forge a new business model for integrated supply chains in East Asia, as well as establishing a stronger joint presence in emerging markets throughout the region and in particular, mainland China. It also supports the government push to further integrate Taiwan into the regional economy on the back of the island’s robust business environment.
There is no question that a trade-friendly climate has helped make Taiwan a top choice for Japanese enterprises eyeing overseas expansion.
Last year, Japan invested in a record 400-plus business projects on the island representing 11 percent growth in value, while at the same time, Taiwan’s investment in Japan grew 520 percent. As of April, Japan was Taiwan’s largest source of foreign investment in project numbers, boasting 66 percent growth in value.
Given this healthy state of affairs, it makes perfect sense for the two countries to catch this investment wave and combine respective strengths spanning the fields of business management, manufacturing, marketing and R&D. As part of these efforts, both sides are close to concluding a mutual recognition agreement that will fast-track product accreditation and clearance procedures, boosting reciprocal trade in electronics and telecommunications.
The MRA, which is a platform allowing signatories to accept each other’s product test results and equipment certifications, does not require harmonization of technical requirements, nor other legally binding obligations. If finalized by year-end as anticipated, the agreement will be another milestone in Taiwan-Japan economic relations following the bilateral investment arrangement signed in September 2011.
Although the government has inked similar MRAs on telecommunications with Australia, Canada, New Zealand, Singapore and the U.S., the Japan agreement is particularly salient as it illustrates the progress Taipei and Tokyo are making in bolstering their relationship. It also sends a strong signal that nascent bilateral deals on anti-money laundering, customs, financial services and patent examination may soon be concluded.
In a world increasingly shaped by economic interdependence, the government’s policy of building stronger Taiwan-Japan economic ties is the right one. The complementary nature of both countries’ manufacturing and technology sectors offers great potential for the ROC’s development track and once harnessed, augurs well for achieving greater national prosperity.