MOEA’s stimulus packages attract over NT$2.1 trillion in investment

Taipei, Dec 30 (CNA) Three stimulus packages proposed by the Ministry of Economic Affairs (MOEA) that launched in 2019 have attracted domestic companies to pledge more than NT$2.1 trillion (US$68.33 billion) in investment in Taiwan, statistics published by the MOEA, shown on Saturday.

In a statement, MOEA said the three incentive packages, which offer preferential loans to encourage investment in Taiwan, have led more than 1,400 domestic companies to agree to pour funds into Taiwan since 2019, which is expected to create 149,000 jobs. places in the local market.

With Taiwan Semiconductor Manufacturing Co. (TSMC), the world’s largest contract chip maker, is keen to expand production and upgrade technology in Taiwan, MOEA said 22 of its suppliers, such as IC packaging and testing service provider ASE Technology Holding Co . and silicon wafer maker Wafer Works Corp., have pledged to invest NT$66 billion in Taiwan under the three stimulus packages, MOEA said.

Amid escalating trade tensions between the United States and China, the MOEA launched the first stimulus package on January 1, 2019, which included the Cabinet’s National Development Fund, which provided NT$210 billion in concessional loans to woo Taiwanese investors with operations in China to return to Taiwan.

The incentives are aimed at reducing Taiwan’s dependence on the Chinese market and mitigating the impact of trade friction between Washington and Beijing.

In addition, on July 1, 2019, the National Development Fund launched another NT$100 billion soft loan incentive package to help local small and medium-sized enterprises invest in Taiwan.

The third package consists of a NT$120 billion allocation fund from July 1, 2019 to encourage enterprises not covered by the first and second packages to invest in innovation industries.

The three stimulus packages, which were extended for an additional three years, focus on 5 plus 2 industries initiated by the government, which are intelligent machinery, Asian Silicon Valley, green technology, biotechnology, national defense, new agriculture and circular economy.

The MOEA said more than NT$1.2 trillion in investment pledged by these enterprises has led to the upgrading of local industries, which has helped the local economy fend off not only the impact of US-China trade tensions but also the effects of disruptions in the global supply chain caused by the COVID-19 pandemic.

MOEA has added a large number of investment projects under the three packages, which include the development of artificial intelligence and industries related to electric vehicles.

They are expected to help Taiwan take advantage of business opportunities in these emerging sectors in the global market.

The Ministry of Environment and Environment said that Taiwan is leading many other countries in the information technology industry, so many Taiwanese companies have become part of the global supply chain of the US electric vehicle brand Tesla.

According to a recent report by Taiwan’s Common Wealth magazine, a total of 29 Taiwanese key component firms have served as suppliers to Tesla in a wide range of products, such as power systems, electric motors, batteries, car frames and charging systems.

Among the companies reiterating the government’s call to invest in Taiwan under the three EV market investment packages are flat-panel supplier Innolux Corp., electronics contract manufacturer Pegatron Corp., thick-film substrate maker Tong Hsing Electronic Industries, Ltd. and forged wheel supplier SuperAlloy Industrial Co., which were part of Tesla’s supply chain, according to MOEA.

It said some companies from the old economy had also entered the EV market as they focused on new energy development by applying for the ministry’s incentive programs.

One of them is the petrochemical conglomerate Formosa Plastics Group, which has invested in the development of lithium-titanate batteries, and the motorcycle brand Kymco, which has started to launch electric scooters. The three packages are scheduled to expire at the end of 2024.

(By Pan Tzu-yu and Frances Huang)

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