Taiwan - Economic analysis of government policies, investment climate and political risk.






TAIWAN: Economic Policy Analysis

This site presents an analysis of Taiwan government's economic policies compared to a revised list of 34 economic policies as prepared by Ms. Chih-Hsuan, Kuo with the McKeever Institute of Economic Policy Analysis (MIEPA) in December of 2005. To read the analysis scroll through this site. To learn more about the background policies, click here  Introduction and Policy Recommendations

To learn more about MIEPA, click here Return to MIEPA's Home Page

Chih-Hsuan, Kuo, a Taiwan native who currently [December 2005] lives in San Francisco, has completed a study of her home country government's economic policies as compared to the MIEPA list of policies as outlined above. The study on Taiwan is shown below. The ratings herein are based on the following rating scale:


5.0 Perfect Facilitation of Wealth Creation
4.0 Midway between Perfect and Neutral
3.0 Neutral Effect on Wealth Creation
2.0 Midway between Neutral and Obstructionist
1.0 Perfectly Obstructionist to Wealth Creation
[Rating scale copyright Mike P. McKeever, 2005. Used herein with permission]

To read a disclaimer about the analysis in this file, scroll to the bottom of the file.

Return to MIEPA's Home Page


Comparison of Taiwan's economic policies to MIEPA criteria as prepared by native student of Taiwan, Chih-Hsuan, Kuo, studying in the US in December of 2005.



        1               5.0          15.0             15.0       100 %

        2               5.0          15.0             15.0       100

        3               2.5           7.5             15.0        50

        4               3.0           9.0             15.0        60

        5               4.5          13.5             15.0        90

        6               5.0          15.0             15.0       100

        7               3.5          14.5             15.0        90

        8               3.5          10.5             15.0        70

        9               4.5          13.5             15.0        90

        10              4.0          12.0             15.0        80

        11              4.0          12.0             15.0        80

        12              4.5           9.0             10.0        90

        13              5.0          10.0             10.0       100

        14              4.0           8.0             10.0        80

        15              3.5           7.0             10.0        70

        16              3.0           6.0             10.0        60

        17              2.0           4.0             10.0        40

        18              4.5           9.0             10.0        90

        19              3.0           6.0             10.0        60

        20              1.5           3.0             10.0        30

        21              2.0           4.0             10.0        40

        22              5.0          10.0             10.0        50

        23              5.0          10.0             10.0       100

        24              4.0           8.0             10.0        80

        25              4.5           9.0             10.0        90        

        26              3.6           7.2             10.0        72

        27              3.0           6.0             10.0        60

        28              4.5           9.0             10.0        90

        29              3.0           3.0              5.0        60 

        30              3.0           3.0              5.0        60

        31              4.0           4.0              5.0        80

        32              3.0           3.0              5.0        60

        33              3.0           3.0              5.0        60

        34              3.0           3.0              5.0        60

   TOTAL              126.1         281.7            375.0        75.1%
                      =====        ======            =====        =====

Return to MIEPA's Home Page


1. Freedom from internal control: 5.0

According to a report on freedom around the world in 2002 compiled by US-based organization Freedom House, Taiwan is now on a par with Japan as one of the freest countries in Asia. The US State Department, in its latest country report on human rights, notes that the authorities in Taiwan respect political rights and freedoms of speech, the press, assembly, religion, and travel.

Source: http://www.gio.gov.tw/taiwan-website/5-gp/glance/2003/ch12.htm

2. Freedom of speech: 5.0

According to The Constitution of R.O.C, the citizens in Taiwan have four categories of freedom and one of them is freedom of speech. Citizens in Taiwan have freedom to say, announce and publish anything, and it is protected by Constitution

Source: The Constitution of R.O.C, personal opinion

3. Effective, fair police force: 2.5

According to a Survey by telephone in 2003, the satisfaction of Police of people in Taiwan is 53%.17% of people thing police is unfair. 69.7% of people doubt the principle of police, and only 19.9% of people accept police have good principle.

Source: http://www.ttnn.com/cna/news.cfm/030128/45

4. Private property: 3.0

In Taiwan, private property is protected by law. No organization or other people can interfere one’s private poverty, including movable property, immovable property, creditor’s right and intelligent property. Taking Taipei City as an example, we have witnessed a stream of populist executive actions, notably the forcible eviction of squatters from the Number 14 and 15 Parks, the curfew on young people, and the sudden decision to ban the remaining licensed prostitutes. Without necessarily taking a particular stand on the goals of these campaigns, or their morality (the issue of licensed prostitution, in particular, raises unusually thorny moral dilemmas), we are concerned that the City Government spent little effort considering whether these exercises of administrative discretion exceeded legal limits. Trying to please the majority by sacrificing the rights of smaller and weaker elements, they neglected the real violations of human rights that occurred.

Source: personal opinion

5. Commercial Banks: 4.5

Because of the finance ministry's instructions to lower over-due loan ratios earlier this year, ratios at year-end should be lower than those recorded at the end of April. They must also be as low as 2.5 percent within four years. Reducing the ratios has, there-fore, become a priority for the industry this year. The NT$15 billion write-off for the Taiwan Cooperative Bank, represents about three years' earnings for a large commercial bank. Analysts said the size of the bad loan write-offs for some commercial banks this year will include accumulated bad loans from previous years. One-time write-offs will surely raise the dollar figures significantly, damaging their financial results for the year. Some analysts said the unusually high amounts of non-performing loans at several new commercial banks may be attributed to the interference of major stockholders in lending decisions, coupled with other economic factors. For example, the credit policy at Chung Hsing Commercial Bank and Da An Commercial Bank are widely believed to have been strongly influenced by their major stockholders. Also, since the KMT took a controlling stake in Pan Asia Bank earlier this year, major shareholders have apparently intervened aggressively in the bank's lending policies. Other commercial banks that are run by professional managers, and whose loan policy has seldom been affected by stockholders, such as E. Sun Bank and Bank SinoPac, have much lower overdue loan ratios. The bad loan write-offs for these two banks are among the lowest in the industry this year.


6. Communication systems: 5.0

According to ITU, the cell phone use rate is the number one in the world. Average everyone has 2 cell phones. In 2004TV is the most common way of communication. The rate of watching TV is 74.3%. reading News and Magazines is 28.5% and 34.5% . the rate of listening to broadcasting is 21.2% and the rate of using internet is 44.9%.

Source: http://news.yam.com/ettoday/computer/200505/20050519125785.html

7. Transportation: 3.5

Airplanes are the major tools of transportation to Taiwan. There are two international airports in Taiwan. One is Chiang Kai-Shek (CKS) international airport, which is located Taoyuan County, approximately 300 kilometers, and need about three and half hours by car or bus to Tainan. About thirty-five airlines provide the service from different countries. Another is KaoHsiung international airport, which is located KaoHsiung city, approximately 50 kilometers to Tainan. However, just about thirteen airlines provide the service.

Source: http://www.ncku.edu.tw/~ICMMB/htm/tran.htm

8. Education: 3.5

According to Gross Enrolment Rate by Educational Level, in the level of undergraduate or higher, there are 67.6% of people in Taiwan enroll in 2003-2004. compare with Japan with 51% and American 83%. In this year threr are 337,438 student who graduated from undergraduate school or higher.


9. Social Mobility: 4.5

People in Taiwan have fair chance to be successful or rich. It is not related to your background or relations. Many of the president in big companies in Taiwan are not from rich families, such as the president of acer, and the president of Formosa Petrochemical co, who is the richest man in Taiwan. Also, the president Chen is also from pool family, so he has policy to encourage pool people to be successful.

Source: Personal opinion

10. Freedom from Outside Control: 4.0

Taiwan maintains full diplomatic relations with 26 countries. On the basis of pragmatic diplomacy and mutual interest, Taiwan continues to endeavor to establish diplomatic ties or substantially enhance relations with the rest of the world's countries, maintaining 92 representative offices or branch offices in the capitals and major cities of 59 countries. Although these offices carry various names, such as Taipei Representative Office, Taipei Economic and Cultural Office, or Trade Mission of the Republic of China, all of them perform most of the functions of embassies and consulates general. Reciprocally, 48 countries that do not have formal diplomatic relations with Taiwan have established 58 representative offices or visa issuing centers in Taiwan.

Source: http://english.www.gov.tw/Yearbook/index.jsp?categid=156&recordid=83295

11. Foreign Currency Transactions: 4.0

In Taipei, stores won’t accept U.S dollars and Yen. You need to exchange to New Taiwanese Dollar in Bank, then you are enable to consume anything.

Source: Personal opinion

12. Border Control: 4.5

Illegal Chinese immigrants began pouring into Taiwan after martial law was lifted in 1987. According to official statistics, human smuggling went through a peak period from 1990 to 1993, during which 5,000 mainlanders were smuggled onto the island per year. That number tapered off to about 1,500 between 1994 and 2001, but in 2002, 2,032 illegal Chinese immigrants made it to the island. So far this year, approximately 2,500 have crossed the strait into Taiwan illegally. Experts point out that the actual number of illegal Chinese immigrants to Taiwan who have successfully evaded arrest or detention could be three to five times higher than official numbers indicate.

Statistics show 50 percent of the illegal immigrants come from Fujian province. Others come from the Chinese provinces of Sichuan, Hubei and Hunan, as well as areas of northern China. Nearly 64 percent make a beeline for northern Taiwan, while 22 percent try to gain entry into central Taiwan and 10 percent head straight for the south. Statistics also show that the percentage of women being smuggled to Taiwan is rising dramatically--primarily for the purposes of prostitution.

According to Wang Chun, director of the Coast Guard Administration, "28 percent of women engaged in the sex industry were smuggled into the country, while 29 percent of them entered the country by faking a marriage." This contributed to a surge of the number of Chinese women smuggled into Taiwan in the last few years alone. Official statistics indicate that 7 percent of all Chinese illegals prior to 1998 were female. Today, that number has soared to 84 percent


13. Currency: 5.0

Taiwan only has one currency which is New Taiwanese Dollars issued by central bank of China (R.O.C).


14. Cultural, Language homogeneity: 4.0

The languages and dialects spoken in Taiwan have their origins in the Austronesian and Han lingual systems. The Austronesian languages are spoken by the indigenous peoples, but are slowly disappearing with cultural assimilation among the inhabitants of Taiwan. Common Han languages include Minnanese, widely known as Taiwanese, and Hakka, which are spoken mainly by those whose ancestors immigrated from China's Fujian and Guangdong Provinces in the 17th, 18th, and 19th centuries. In 1949, after the KMT government set up its capital in Taiwan, Mandarin became the common language for communication and was promoted through the educational system. However, following the lifting of martial law in 1987, social pluralization has been accompanied by a growing emphasis on native languages. A movement was initiated to teach students their mother tongue and to preserve the languages and dialects of smaller ethnic groups. This ongoing movement is expected to have an extensive influence on the languages spoken in Taiwan.

Source: http://english.www.gov.tw/Yearbook/index.jsp?categid=24&recordid=52659

15. Political Effectiveness: 3.5

Chi Chi Earthquake thoroughly manifested the inadequacy of urban disaster prevention spatial system in Taiwan area, consequently the disaster prevention and emergency rescue works could not be executed in a streamlined way. Then following the earthquake, although many local governments have contributed enormous efforts to setting up disaster prevention facilities, because there haven't been panoramic urban disaster prevention spatial system plans in place, they have failed to define the functions of those facilities so as to use such as the reference for the construction of disaster prevention step-up projects. On the other hand, for other cities in Taiwan, owing to lack of overall urban disaster prevention spatial system plans, review of comprehensive urban plan directions on phase by phase and district by district basis in connection with route planning, location selection, function defining, scale evaluation for area disaster prevention paths and base points has still been in progress. Therefore, it has become an urgent task with respect to how to prepare effective and feasible plans starting from the most fundamental administrative districts.


16. Institutional Stability: 3.0

To guarantee effective and good governance, constitutional clarity in both procedure and substance is as important as properly designed institutional arrangements. Unfortunately however, many studies have shown that negotiated democratization and incremental reforms, which were common in the third-wave democratization process,15 are likely to create constitutional vagueness and institutional inconsistencies prone to institutional deadlock and political instability.16 Not until constitutional clarity is obtained either through constitutional reengineering or strong intervention of a court, constitutional stability would not be maintained.17


17. Honest Government: 2.0

Taiwan is the fourth least-corrupt country in Asia, after Singapore, Japan and Hong Kong, according to an annual global corruption report released by Transparency International (TI) on October 20. Taiwan ranks 35th in the TI's 2004 Global Corruption Report on the transparency of political finances in 146 countries and areas around the world. Taiwan received a score of 5.6 points on the TI-designed zero-to-10 transparency index, down 0.1 points from its year-earlier level.

Yu Chih-li, director of Shih Hsin University's administrative management department, who concurrently serves as chief executive of the TI's Taiwan branch, said Taiwan dropped five notches in the global ranking as compared with the 2003 rating.Only two of the 13 countries or areas that were gauged this year for the first time outpace Taiwan. "Theoretically, Taiwan should have only dropped two slots. But it dropped five notches. This trend is worthy of the government's attention," Yu said.

Chai Sung-lin, a national policy adviser to the president, said political democratization and economic liberalization may not necessarily reduce corruption. For instance, mainland China received only 3.4 points in the TI transparency index, ranking 71st in the global rating.


18. Common Laws: 4.5

The ROC Constitution is based on the principles of nationalism, democracy, and social well-being formulated by Dr. Sun Yat-sen, the founding father of the ROC. His political doctrine is known as the Three Principles of the People. Also, there are various laws to protect the economics environment such as Civil Law, Criminal Law, Trademark Law, Labor Law, Patent Law, Insurance Law, Maritime Law, LandLaw, Law of Negotiable Instruments, and Law of Consumer Protection. However, 58.2% of people doubt the fair of court, and 32% of people believe that the court is fair.

Source: personal opinion; http://www.ttnn.com/cna/news.cfm/030128/45

19. Central Bank: 3.0

According to the Central Bank of China Act, the Bank's operational objectives include promoting financial stability, ensuring sound banking operations, maintaining the stable internal and external value of the currency and, within the scope of the above three objectives, fostering economic development. In order to achieve its operational objectives, the Central Bank of China conducts the following operations: Monetary Management, Foreign Exchange Management, Clearing and Settlement Services, Currency Issuance, Treasury Agency Functions, Bank Examination, Statistics and Research, and Participation in International Organizations.

Source: http://www.cbc.gov.tw/EngHome/esecretariat/aboutthebank/operation.asp

20. Domestic Budget Management: 1.5

The year 2003? (hereinafter referred to as “theis year” )? final Central Government accounts originally designated revenue stood at $1 trillion 322.4 billion, expenditure at $1 trillion 550.2 billion, with a difference a difference of $227.8 billion; repayment of principal amounted to $465 billion, requiring a financial statement of $274.3 billion. Government bonds were issued, funds borrowed, and past annual surplus transferred to reach a balance. To relieve the short-term unemployment issue swiftly, boost economical prosperity, elevate citizen quality of life and strengthen National Infrastructure within the year, the first increase (decrease) of budget has been processed in accordance to with the “Temporary Provisions For Expanding Employment Through Public Service” and the “Infrastructure Investment and the Major Investment Projects” regulations. Also, to care for senior citizens and to lessen the damage to farmers and assist adjustments of the agricultural products industryies suffering from a glut of imported products to lessen the damage to farmers, the second increase (decrease) of budget has been processed in accordance to with the “Temporary Provisions for Elderly Welfare Subsidy” and the “Agricultural Development” regulations. As a result of the two listed increases (decreases) in budget modifications, the revenue increased to $1 trillion 61.6 billion, the expenditure increased to $1 trillion 656.7 billion, the difference amounted to $295.1 billion; repayment of principal amounted to $46.5 billion, requiring a financial statement of $341.6 billion. Government bonds issued and funds borrowed amounted to $302.3 billion, with an additional transfer of $39.3 billion from past annual surplus to reach a balance.

Due to the US-Iraq War and SARS epidemic this year, the national economy faced great losses, which relatively influenced processing of the year’s final Central Government accounts (including increases and decreases in budget). The rRevenues was affecteddipped, identifiable especially in due to tax shortages, especially in such as income tax tax and stock exchange tax. ; lLuckily, the business surplus and income increased marginally, and with Government retrenchment of recurrent expenses, the recurrent revenue barely made it possible for a surplus, which totaled $30.2 billion to leave in surplus. After making transfersrring to fund capital expenditure, the difference between revenue and expenditure amounted to $298.9 billion and repayment of principal amounted to $46.5 billion, requiring a total financial statement of $345.4 billion. All revenue shortages fall in capital departments, thus the Budget Act was applied. Government bonds issued and funds borrowed amounted to $301.6 billion, with an additional transfer of $43.8 billion from past annual surplus to reach a balance.

Source: http://eng.dgbas.gov.tw/ct.asp?xItem=9481&ctNode=1956

21. Government Debt: 2.0

According to a study by the National Policy Foundation, a Kuomintang think tank, Taiwan's national debt has soared to NT$12 trillion, accounting for 50 per cent of gross domestic product. In other words, every one of us, including a baby born today, owes more than NT$520,000, which seems to take eternity to repay, even if the spendthrift government were able to kick the habit of making deficit budgets. The government was quick to defend against the accusation of creating a mountain of national debt. It said the think tank figures include the debts of state enterprises which have just as large assets that have been purposely omitted in the balance sheet. It predicted Taiwan's national debt-GDP ratio would top 39.9 per cent in 2008 and then start to dip. Even then, it said, it would not be high, or at least lower than Japan's 144 per cent or America's 40 per cent.

Source: http://www.npf.org.tw/PUBLICATION/NS/093/NS-C-093-110.htm

22. Economic Statistics: 5.0

Economic Growth: 3.8%

GNP per citizen: US$13,157 dollars

GDP: US$295.8 billion dollars

Exports: US$144.18 billion dollars

Imports: US$127.25 billion dollars

Ratio of increasing industries products: 7.2%

Ratio of non-job labor: 5.0%

Source: http://2k3dmz2.moea.gov.tw/gnweb/main.aspx?Page=J

23. Protection of Public Health and Safety: 5.0

As the ratio of elderly people in society increases, chronic cardiovascular diseases have replaced infectious diseases as the major causes of death among adults. In 2002, for instance, cerebrovascular diseases, heart diseases, and diabetes mellitus were the second, third, and fourth leading causes of death, respectively, representing 25.42 percent of all deaths that year. Suicide also increased in prominence, becoming the ninth leading cause of death in 2002

Source: http://english.www.gov.tw/Yearbook/index.jsp?categid=27&recordid=83375

24. High Wage Policies: 4.0

The increasing demand of manpower due to economic development led to the continuous decline in unemployment rate. Unemployment rate decreased from 2.91% in 1985 to 1.51% in 1992. Wage level was pushed up incessantly during the period from 1986 to 1992. The average wage rate of manufacture industry grew more than 10% per annum during the same period. Continuous increase in wages meant workers were able to share the fruit of economic development, avoiding the problem of income disparity. Exports of Taiwan were mainly labor-intensive products. Substantial rise of NTD and rapid increase of wages had adverse effect on the competitiveness of labor intensive products in the international market. One of the reasons laid in the fact that wage accounted for a relatively larger proportion of the cost of products of this kind. The fast increase of wages would surely push up the cost rapidly. Besides, wages were paid in NTD. Major machinery and raw materials producing labor-intensive products were supplied domestically. When exporting labor-intensive products, the value of foreign exchange income received therefrom had a substantial decline when converted into NTD. In other words, the Taiwanese traditional labor-intensive products had consequently lost their international competitiveness.


25. Environmental Protection: 4.5

Despite its small area, Taiwan is home to approximately 150,000 different forms of life, or 1.5 percent of all life species found on earth. About 30 percent of these are endemic species. In August 2001, the Executive Yuan formulated an action plan to pursue "the conservation of biological diversity, the sustainable use of its components, and the fair and equitable sharing of the benefits arising out of the use of genetic resources" as established under the UN Convention on Biological Diversity. This plan calls for the promotion of biosafety, management of alien species, restoration of degraded ecosystems, research on biological diversity and related changes, establishment of protected areas, and preservation of traditional knowledge through the involvement of indigenous peoples and local communities. Increased public awareness and international cooperation are also paramount to the sustainable conservation of biological diversity in Taiwan. Due to the weakness of the law of protection environment, some people are still hurting the environment without being arrested

Source: http://english.www.gov.tw/Yearbook/index.jsp?categid=161&recordid=83364; Personal opinion

26. Strong army: 3.6

Ground Forces: The ROC Army defends the country's territory and ensures the integrity of sovereignty. In peacetime, its mission is centered on defending critical areas of strategic significance on Taiwan and offshore areas and conducting basic training to maintaining capabilities. In war, the Army conducts joint operations with the Navy and Air Force.The primary weapon systems of the ROC Army include AH-1W attack helicopters, OH-58D scout helicopters, M-48H and M-60A-3 tanks, portable Stinger surface-to-air missiles, Chaparral self-propelled air-defense missiles, M-109A-5 self-propelled howitzers, Sky Bow air defense missiles, and Patriot air defense systems.

Navy: The ROC Navy maintains control and surveillance of the waters surrounding Taiwan and participates in joint operations with the Army and Air Force. The Navy Headquarters oversees operational and land-based forces. The ROC Navy totals 50,000 personnel.

Air Force: Taiwan's geographical location makes air defense crucial for overall defense of the nation. At present, the ROC Air Force has about 50,000 officers and men divided into operational and logistical support systems under the command of the Air Force Headquarters. The primary weapon systems of the ROC Air Force include IDF, F-16, and Mirage 2000-5 fighters; Sidewinder, Maverick, Sparrow, Mica, and Magic missiles; and Sky Sword I and II missiles.

Source: http://www.gio.gov.tw/taiwan-website/5-gp/yearbook/P101.htm

27. Foreign trade impact: 3.0

Taiwan will have to remove non-tariff trade barriers after its accession to the WTO in order to abide by its commitments and concessions on trade in services. According to the Board of Foreign Trade, 11 service sectors will be affected, ranging from transportation and communications to financial services. Additionally, the commitments and concessions on market access will have an impact on both Taiwan's agricultural and industrial sectors. According the foreign trade board, roughly 4,491 items will face tariff reduction after entry. In 1992, the average nominal tariff rate for agricultural products was 21.83 percent, and the rate will be reduced to 12.93 percent after the full implementation of Taiwan's commitments. As for industrial products, the 1992 average nominal tariff rate was 6.52 percent and it's set to be reduced to 4.31 percent

Exports: US$144.18 billion dollars

Imports: US$127.25 billion dollars

GDP: US$295.8 billion dollars



28. Protection of foreign currency earning enterprises: 4.5

In 2001, there were 1,178 approved inward foreign investments, totaling US$5.13 billion. Compared to the previous year, the total number of approved inward foreign investments decreased by 32.59 percent. Most of Taiwan's inward foreign investments in 2001 came from British territories in Central America, mainly the British Virgin Islands and the Cayman Islands (27.23 percent). This was followed by the United States (18.33 percent), Japan (13.35 percent), the Netherlands (10.25 percent), and other European countries (5.56 percent). Combined, these areas accounted for 74.72 percent of Taiwan's inward foreign investments in 2001. Taiwan has already opened its finance, insurance, transportation, telecommunications, and real estate sectors to foreign investment. At present, with the exception of a small number of ratio restrictions on foreign investment, such as in telecommunications services, foreign investors enjoy the same equal treatment as local investors. Manufacturing is also completely open to foreign investment, except for a small number of items that affect national security, health, and environmental protection. The degree of liberalization has reached 99 percent in the manufacturing sector and 95 percent in the service sector. The top five sectors for foreign investment in 2001 were banking and insurance (28.75 percent), electronic and electrical appliances (20.58 percent), wholesale and retail marketing (15.41 percent), services (12.95 percent), and chemicals (2.65 percent). These five categories together accounted for 80.34 percent of all investment by overseas Chinese and foreign nationals.


29. Management of foreign currency budget: 3.0

Central Bank Governor Perng Fai-nan yesterday denied media reports that a Cabinet proposal would have allowed NT$10 billion of the nation's NT$6.91 trillion (US$202.83 billion) foreign exchange reserves to be loaned out to directly finance local investments. Perng told The Liberty Times -- a sister newspaper of the Taipei Times -- in an exclusive interview that Premier Yu Shyi-kun did not "instruct the central bank to make use of the nation's foreign exchange reserves for direct loans to businesses." Perng said that though the media reports are inaccurate, it is true that "the Cabinet is mulling measures to allocate budget items so as to subsidize importers with low-interest-rate foreign-currency loans, which can be used for equipment purchases from overseas, while at the same time trying to lower the nation's foreign reserves."

Exports: US$144.18 billion dollars

Imports: US$127.25 billion dollars



30. Layers of collective action: 3.0

Since the lifting of martial law in 1987, Taiwan has moved rapidly toward full democracy. Voting eligibility is defined broadly: the minimum voting age is 20, and there are no gender, property, or educational requirements. Voter registration is automatic. The government notifies citizens of all impending elections through the distribution of a bulletin or gazette that identifies and describes all candidates and their platforms for every district.

Taiwan's electoral process varies with the type of office. For such executive posts as president and vice president (forming a single ticket), special municipality mayors, county magistrates, provincial municipality mayors, rural and urban township magistrates, and county municipality mayors, each voter casts one vote in a single-member district, and the candidate who receives a plurality of the vote is elected.

Elections for the Legislative Yuan, special municipal councils, county or city councils, and township councils, use the single non-transferable vote (SNTV) method. Normally, several representatives are elected from a single electoral district, which is based essentially on existing administrative boundaries. Each voter casts only one vote, and several leading candidates are elected

Source: http://www.gio.gov.tw/taiwan-website/5-gp/yearbook/P073.htm

31. Pro business climate: 4.0

People usually want to learn skills to start business. People will think the people who have their own business are better than those who work as salary man. It is very common that people work as salary man first, and after they earn enough money they will build their own business.

Source: personal opinion

32. Government enterprises: 3.0

For entering WTO, Taiwan decided to make all 42 Government enterprises private in 2000.

Source: http://www.etaiwannews.com/Forum/2001/05/22/90497053.htm

33. International security agreements: 3.0

Taiwan’s national security lies on three dimensions: politically, Taiwan’s sovereign status dispels China’s claim that invading Taiwan is China’s domestic matter; militarily, Taiwan has self-defense capabilities with the support of the U.S.; and economically, Taiwan can afford continuing democratization, human rights improvement, foreign aids, and purchase of defense weaponry. Of the four regional organizations in Asia-Pacific: ASEAN (including ARF), APEC, PBEC, and CSCAP, the only one Taiwan can participate officially is APEC. Because these regional organizations have not had significant functions in regional security, Taiwan’s absence from them has not directly affected Taiwan’s national security. Nevertheless, it is extremely important for Taiwan to maintain close economic relations with members of the Asia-Pacific regional organizations, particularly APEC, so as to enhance its economic capabilities that are essential to maintain Taiwan’s political and military prowess.

Source: http://www.cju.edu.tw/publish/1006.htm

34. Protection of domestic enterprises from government mandated costs: 3.0

Taiwan became a full member in the World Trade Organization (WTO) starting January, 2002. Although Taiwan has been given this preferential status, domestic industries are bound to face impacts as a result of the globalization of capital, human resources etc.

Due to more frequent business interaction with china, Under small three links policy, however, only Kinmen and Matsu residents whose households have been registered in Kinmen or Matsu for over six months are allowed to apply for permits to enter China from Kinmen Feb 03, 2001. it’s easier to increase economic exchange and cooperation

Source: http://www.etaiwannews.com/Forum/2002/02/15/1013321157.htm; http://www.taipeitimes.com/News/archives/2001/02/03/0000072131/wiki


All the information and conclusions in each country analysis are solely the responsibility of the individual student and have not been verified, corrected, checked for copyright infringement or evaluated in any way by MIEPA or Mike P. McKeever. You are solely responsible for the results of any use you make of the information and conclusions in these studies. Use them at your own risk as interesting supplemental information only instead of seasoned judgements about the policy factors contained herein. Each student has granted permission for his or her work to be displayed here under his or her own name or wishes to remain anonymous and have either created a pen name or used no name at all; if you wish to contact them for any reason, forward your request to MIEPA and the student will be notified of your interest.

To learn more about other countries, click to other files here:

Return to MIEPA's Home Page


Return to MIEPA's Home Page list of country studies

Introduction and Policy Recommendations

Winning Essays: There Are Alternatives Project (TAA)

Essay: Balanced Trade: Toward the Future of Economics

Moral Economics


Web address: http://www.mkeever.com


To contact MIEPA, please send an email to this email address:


Please place the acronym MIEPA in the subject line.