Mr. John C.C. Deng (鄧振中), Minister of Economic Affairs;
Dr. Hsiung Kuang-hua (熊光華), Deputy Secretary-General to the President;
Global business leaders;
Distinguished guests;
Ladies and gentlemen:
Today, September 2, 2015, is the 70th anniversary of the end of World War II. Well, I know, you could care less about it. But it's very important to me. Without that tremendous effort, we wouldn't have a free, democratic, and prosperous Taiwan. As president of this country, I certainly appreciate the efforts of the Allied forces in winning the war, and restoring Taiwan to the Republic of China.
I'm very happy to join you again for today's 2015 Taiwan Business Alliance Conference. This marks the twelfth year that the Ministry of Economic Affairs has organized this conference, and over the years, this conference has become a bellwether event, helping to attract over 600 multinationals to invest in Taiwan. This is the fifth time I've been honored to attend, and I sincerely hope that everyone will come away from this congress with a better understanding of Taiwan's investment environment and competitive advantages.
I. Creating a quality investment environment; participating in regional economic integration
To become more closely linked with evolving international economic and trade systems, the government of the Republic of China has long promoted the signing of Free Trade Agreements. Last year, we also began to integrate inter-ministerial resources to pave the way for Taiwan's participation in the Trans-Pacific Partnership (TPP) and the Regional Comprehensive Economic Partnership (RCEP), the two most important regional economic integration mechanisms in this part of the world.
Many US officials have already publicly welcomed Taiwan's entry into the TPP, and Assistant Secretary of State for East Asian and Pacific Affairs of the United States, Mr. Daniel Russel, stated that the US will give Taiwan serious consideration as a candidate for TPP membership.
It is ultimately important for my country to join, because our trade with the 12 members, the active members of the TPP, account for 35% of our total bilateral trade. That means US$200 billion. Another trade integration mechanism RCEP, actually has 16 members altogether, that account for 57% of our bilateral trade. That means US$325 billion. So altogether, subtracting the seven overlapping countries, 21 countries of these two regional economic integration mechanisms account for 70% of our bilateral trade.
So now I'm going to talk a little bit about why Taiwan matters.
II. Taiwan's four major niche advantages; attracting foreign investment
We actually have four competitive advantages which I think matter in your decision about whether to invest here or not.
First of all, we have efficient industrial clusters. Second, strong innovation and R&D capabilities. Number three, a high-quality investment environment. And number four, a safe and friendly living environment.
Taken together, these are the factors that make Taiwan your optimum choice for foreign investment.
Let me first talk about number one—efficient industrial clusters.
Since 2006, for 9 straight years Taiwan's industrial cluster development has been ranked either No. 1 or No. 2 in the World Economic Forum's Global Competitiveness Report, the WEF report. This year, 2015, Taiwan also climbed 2 places in the IMD report, the International Institute for Management Development in Lausanne, Switzerland, in their yearbook of world competitiveness report. Our ranking is No. 11. In the Asia Pacific Region, Taiwan ranked third, behind only Hong Kong and Singapore.
Advantage Number 2 is strong innovation and R&D capabilities. The Republic of China government's budget for science and technology development has increased by almost 21% since 2007, the year before I came into office, rising from NT$81.9 billion that year to NT$98.8 billion this year. At the same time, the government has actively recruited global enterprises in various industries to set up their innovation or R&D centers in Taiwan, and numerous multinational corporations including Merck, Hewlett-Packard, ASML, and SONY have established R&D centers here in Taiwan.
Taiwan also ranked No. 8 in the 2015 Global Entrepreneurship Index compiled by The Global Entrepreneurship and Development Institute, just ahead of countries like Switzerland and Singapore.
Advantage Number 3 is a high-quality investment environment. Taiwan's high-quality investment environment and reputation for law and order have been recognized by the international community. In the "Thomson/Reuters/INSEAD Asia Business Sentiment Survey" released by INSEAD in June of this year, Taiwan's Business Sentiment Index score was 63 for the second quarter, ahead of Japan, which scored 60.
According to the Business Risk Reports 2015 No. 2, released last month by the US-based analysis and consulting firm Business Environment Risk Intelligence (BERI), Taiwan scored a 67, ranking No. 4 among the 50 countries evaluated, behind only Singapore, Switzerland, and Germany.
Again, according to the IMD's World Competitiveness Yearbook, which I mentioned earlier, Taiwan's investment environment continues to improve. Among the four major evaluation criteria, Taiwan ranked highest in "government efficiency" at No. 9 in the world, and in the "economic performance" and "business efficiency" sub-indices, Taiwan moved up three places to rank No. 11 and No. 14, respectively.
Advantage Number 4 is a safe and friendly living environment. In addition to our economic advantages, Taiwan also offers an attractive living environment featuring cultural variety, convenience, and comfort. At the end of 2015, the on-line magazine Presscave.com listed the Top 10 Safest Countries for 2015, and Taiwan was ranked the second-safest country in the world. Iceland was No. 1. And a number of surveys by the American Chamber of Commerce in Taipei also showed that for the past 5 years, when the members were asked to list the top benefits of living in Taiwan, the second most popular response is "My family feels safe," which shows just how much the international community appreciates the safety and security of Taiwan society.
Actually, if you look at the crime statistics in the year 1995 and the year 2014, you will be surprised to find that the population increased in the last 20 years, but the number of criminal cases dropped more than 30%, and the clearance rate went up 11 percentage points. On the other hand, if you look at serious crime, the number went down 76%, and the clearance rate went up to 98%. So we can assure you of a really safe and friendly environment in Taiwan.
I'm sure, for those of you who have stayed here for a while, you will recognize how friendly the people here are. If you ask for directions when you get lost, more often than not, they will just take you to the place, either using their motorcycle, or just lead the way. So they are ready to help you however they can.
So, in conclusion, I'd like to encourage all of you to avail yourselves of our unique investment advantages, and continue to increase your stake in Taiwan. Together, we can create a win-win situation for mutual prosperity.
I trust today's conference will foster a greater understanding of the possibilities in the future.
Last, but not least, Taiwan has a very rich cultural life. You can squeeze some time out of your very busy schedule to do two things. First of all, to visit the National Palace Museum, which houses the art treasures of the last 3,000 years. Not 300—three thousand years. That is among the top ten museums in the world, and shows this country's past. If you want to understand this country's present and future, you should visit our night market. You will see a variety of exotic foods, which will make your life much richer in the future.
Once again, welcome to Taiwan, and enjoy the rest of your stay.
Thank you very much!