Taiwan – the underestimated other China

Swiss exports to Taiwan amounted to 1.7 billion Swiss francs in 2016, mainly chemical and pharmaceutical products, watches as well as machines and electronic products. Swiss imports from Taiwan on the other hand amounted to 1 billion Swiss francs. Machines and electronics products accounted for the biggest part, followed by bicycles. For decades, Switzerland has had a positive trade balance with Taiwan. What’s more, Swiss companies employ about 17,500 people in Taiwan.
Swiss companies would profit from the conclusion of an Economic Cooperation Agreement, without needing to fear negative effects on our agricultural sector. Alexander Hagemann, Vice President of the Swiss-Asian Chamber of Commerce and Chairman of the Taiwan Committee explains: “Taiwan is worldwide the 22nd biggest economy. Already today, trade with Switzerland exceeds trade with Mexico or Russia. Swiss industry would significantly benefit from closer cooperation with Taiwan, and I hope that an agreement abolishing trade restrictions can be concluded in the not-too-far future.”

Family-run Companies
The WEF global competitive league shows Taiwan repeatedly in 15th place, behind Canada. The entrepreneurial landscape, similarly to Switzerland, is characterised by family-run small and medium-sized enterprises as well as globally active multinational companies. “Taiwan, in comparison to China, profits from a liberal economic order allowing distinctly more flexibility to establish subsidiaries,” Hagemann says. “This determining factor has been especially important in encouraging more than 150 Swiss companies to become active in Taiwan, investing CHF 2.5 billion in the past years.”
With the biotech sector, Taiwan has another similarity to Switzerland, as it is represented by highly productive companies as well as a dynamic start-up scene. Science parks all over the country maintain a multitude of research facilities working side-by-side with suppliers along the added value chain. The recent Switzerland – Taiwan Biotech Seminar, organised by the Swiss-Asian Chamber of Commerce, focussed specially on this development.

Attractive for China
Fears that dealing with Taiwan could harm business relations with China are unfounded. “Economic ties between Taiwan and China are very close,” Hagemann says. “Taiwanese enterprises are the most important foreign investors in China and more than one million Taiwanese live in mainland China. The regulatory conditions between China and Taiwan are good. Taiwan is attractive for China to control business activities in East Asia.”