Transmeta (Semiconductor) (TMTA)

[weaksidehelp]

Taiwan's Challenge 2008

Interesting article on Taiwan's six-year national high-tech development plan,

Government unveils details of six-year development plan

Published: May 10, 2002
Source: Taipei Journal

http://www.taiwanheadlines.gov.tw/20020517/20020514f1.html


In 2008, when Beijing is in the limelight hosting the Olympic Games, Taiwan will be evaluating the effectiveness of the six-year national development plan released this week. This development blueprint is the latest effort to foster the creativity and talent Taiwan needs to evolve into a "green silicon island." Calling the plan "Challenge 2008," Premier Yu Shyi-kun said the projects will cover wide-ranging areas focusing on economic growth and environmental protection. He said internationally the nation faces technological challenges and a loss of investment and skilled managers to mainland China. The Executive Yuan has formulated three major reforms and four major investments in the national development plan.

The four major investments include cultivating talent, research and development and innovation, international logistics, and a high-quality living environment. Yu said implementation of the plan will boost economic growth to more than 5 percent, while lowering unemployment to less than 4 percent.

The 10 projects will cost an estimated US$749.28 billion, of which US$26.59 billion will be private-sector investment. The remainder will come from the central and local governments, along with government funds, with an extra US$1.44 billion being allocated each year for a total of US$8.65 billion over the six years.

According to the Directorate-General of Budget, Accounting & Statistics, the various ministries will see their annual budgets grow by 14 percent, public construction by 5 percent and science and technology by up to 15 percent. Investment in research and development will be raised from 2.05 percent of gross domestic product at present to 2.62 percent in six years and 3 percent in 10 years.

Vice Premier Lin Hsin-i pointed out that the government presently accounts for 38 percent of spending on research and development with only 62 percent of such investment coming from the private sector. He hopes that by 2007, private sector investment in research and development will reach 70 percent, with the government's share dropping to 30 percent.

The plan puts primary emphasis on cultivating talent, especially English ability and technological skills. The premier believes that such skills will be necessary for Taiwan to compete globally.

To achieve these aims, the Ministry of Education will promote English proficiency, improve quality of teachers and reduce discrepancies between urban and village areas by providing incentives such as rental and transportation subsidies to attract teachers to outlying areas.

Education Minister Huang Jong-tsun said many urban kids begin going to bilingual and English-language schools as early as kindergarten, which have native speakers. In contrast, kids from rural areas do not have English classes until the fifth grade. As a result, their listening and speaking abilities lag far behind their urban counterparts.

According to Ho Mei-yueh, vice chairwoman of the Council for Economic Planning and Development, the economic part of the plan will focus on developing value-added products and promoting the island as a research and development, and operations center.

To reach these goals, the government will allocate US$1.44 billion over five years to provide manufacturers with low-interest loans for research and development. The government will also take the lead in setting up 50 venture capital funds in the next six years to encourage startups. Each fund will have US$57.64 million for a total of US$2.88 billion.

The Executive Yuan's Development Fund will supply 30 percent of the capital, with the rest coming from the private sector. These funds will be used in promoting knowledge-intensive industries such as biotechnology and nanotechnology, and to establish international marketing channels and local brands.

To develop core technologies, 60 research and development alliances will be established in areas such as system-on-chip, optical information and communications, and biotechnology and genetic engineering.

The island has already made great strides in previously targeted areas. The production value of both the island's semiconductor and LCD industries is expected to pass the NT$1 trillion (US$29 billion) mark by 2006.

Since local integrated-circuit designers are in short supply, the Industrial Technology Research Institute's System-on-Chip Center and the National Science Council's Chip Implementation Center will set up an academy to work on training for design, manufacturing, packaging and testing.

Meanwhile a digital academy will graduate 2,000 students in information technology each year, with an additional 10,000 workers getting on-the-job training. In six years, the government also hopes to popularize home and commercial use of the Internet to reach its target of 6 million broadband households.

The government will set up 10 research and development centers including one for genetic research and development at Academia Sinica, mobile communications at the Chungshan Institute of Science and Technology, nanotechnology at ITRI and design at the Nankang Software Park. The government will also establish eight science-based parks, including biomedical and IC design parks in Hsinchu, and science-based parks in central and southern Taiwan.

CEPD officials said the information communications, biotechnology and nanotechnology industries will be crucial to Taiwan's development. While they believe that the government has invested enough in the first two, they think Taiwan lags behind Europe, the United States and Japan in nanotechnology. The government is determined to close this gap by investing US$667.78 million between 2003 and 2008.

In terms of transportation, the government is constructing a high-speed rail, linking stations with freeways and secondary railways, and building urban mass rapid transit systems. A direct rail line from Taipei to Hualien through the mountains is also being planned. Such a line could reduce travel time to 70 minutes. The trip now takes as long as three hours.

The government will also link airports and harbor facilities to promote more efficient multimodal transport. Lin Ling-san, head of the Ministry of Transportation & Communications, said if all the plans are implemented, the government will spend an estimated US$23 billion over the next six years.

As for tourism, Minister without portfolio Lin Sheng-feng said the goal is to double the number of tourists and raise its share of gross domestic product from 3.4 percent to 6 percent by 2007. In 2001, there were 2.62 million visitors, including foreign workers, tourists and business travelers. Tourists alone numbered 990,000. The goal is to double this to 2 million.

To do this, the visa application process may be simplified, tourism information will be made more accessible over the Internet and speed and convenience of the local transportation system will be improved.

Lin also pointed out that the sustainable development segment will include better management of water, flood prevention projects and promotion of renewable energy resources. In light of recent water shortages, US$1.15 billion will be invested to develop water resources and a desalination plant with a daily capacity of 60,000 metric tons of water to supply the Hsinchu and Tainan science-based industrial parks.

The MOEA said presently reservoirs can provide 4.2 billion metric tons of water annually, or 1,160 metric tons daily. Construction on the new reservoirs will begin in 2005, with completion between 2008 and 2014.

Furthermore, a 700-hectare artificial lake will also be built in Kaohsiung and Pingtung counties. This will also be the nation's first flat reservoir and will cost US$461 million. Another US$368.88 million will be used to divert rivers to the Tsengwen and Nanhua reservoirs. Presently the sewage systems of only 8 percent of Taiwan's people lead to wastewater plants. This will be raised to 20.3 percent in six years.

At the same time, the Ministry of Economic Affairs will invest US$115.27 million to develop renewable energy. Moreover, the annual production value of solar water heaters is expected to increase to US$40.35 million from US$23.1 million.

The MOEA also plans to build a solar city, which will be fully powered by solar energy. A wind farm will be set up on the west coast, where wind resources are abundant, and park run on geothermal energy will be established as well.

"The most challenging part of the six-year development plan, however, is promoting an innovative culture," remarked Chen Chi-nan, minister without portfolio. He believes without brainpower, industrial transformation is not possible. It is only through upgrading design through innovation that higher value-added production can be attained.

The Council for Cultural Affairs will invest US$100.86 million to establish five innovative culture parks in Taipei, Taichung, Chiayi, Tainan and Hualien, the latter four in old Taiwan Tobacco and Wine Monopoly Bureau distilleries and warehouses. Wu Mi-cha, vice chairman of the CCA, said these five parks will be operational in four years at the latest.

Previously, people thought of the arts either in terms of high-brow or popular culture, but seldom in connection with industry. The CCA hopes that by incorporating MOEA experience and resources to promote an artistic and cultured lifestyle, it will contribute to the economy.

As part of this plan, the council will invest US$270.89 million to preserve and revitalize historical and cultural sights. The CCA pointed out that urban development has threatened cultural preservation despite promulgation of the in 1982 Cultural Heritage Preservation Law.

Finally, because of the rapid aging of Taiwan society, the government has incorporated caretaking into the plan. Beginning in June, all people above 65 years of age incapable of caring for themselves and disabled people will receive eight hours of free caretaking services per month from the government. The government will allot US$147 million to create 24,800 jobs, with some 100,000 people benefiting from the services.