ROCCOC-Promting Trade in Taiwan

The General Chamber of Commerce of the Republic of China is a hub for international business for business people who are interested in investing in Taiwan.

History and Establishment

Founded on November 1, 1946, the General Chamber of Commerce of the Republic of China (hereafter, the Chamber) is the major representative for commercial business, and service sectors. The Chamber has more than 1.37 million members, including district chambers and trade associations of all sectors throughout Taiwan. It serves as a platform between the officials and industries, and aims to foster the prosperity of Taiwan through promoting foreign trade, enhancing economic growth, and facilitating the relationship between various business communities. To highlight the efforts put in by the associations in fostering trade in Taiwan, Taiwanese government named November 1 “Merchant Day”.

In addition, the Chamber established the Taiwan Coalition of Service Industries (TWCSI) in 2007 to highlight the importance of trade in services, which accounts for almost 70% of GDP in Taiwan. TWCSI directly engages with individual companies and organizations, and plays an important role in helping its members reach out to international trade opportunities.

Hub for Business Opportunities

One of the major contributions of the Chamber and TWCSI is the ability of being a hub to attract business opportunities for domestic and foreign companies. A lot of business associations from China have contacted and visited us to learn about investment environment and opportunities in Taiwan. Also, we maintain good relationships with foreign Trade Representatives and Business Councils based in Taiwan, and bring companies together. Starting in 2010, we have co-organized with the China General Chamber of Commerce on an annual Cross-Strait Service Forum that brings together government officials, CEOs and leaders from NGOs in sectors such as financial, accounting, e-commerce and retails.

Every year on Merchant Day starting 1984, the Chamber holds the “Golden Merchant Award“, handed out by the President, vice president and ministers of Taiwan to honor outstanding trade offices, embassies, foreign firms based in Taiwan and local entrepreneurs on their accomplishments and contributions to the Taiwanese society. Many of the European companies, such as KLM - Royal Dutch Airlines, Nestlé, B&Q International Co., Ltd., PCA Life Assurance Co. Ltd., and trade offices, for instance British Trade & Cultural Office, Trade Office for Swiss Industries, have been awarded the Golden Merchant Award, and maintained a close relationship with us.

ECFA – a Channel between UK and Asia for Trade in Services

The Economic Cooperation Framework Agreement (ECFA) with China, signed in 2010, has a great influence on Taiwan, increasing 10% of cross-strait trade, and making Taiwan the main channel for trade with China. ECFA has significantly facilitated trade in financial services, lifting the limitations on market entry, RMB dealing, and ownership of local banks. Taiwan has advantage over foreign banks in entering China. For instance, it only takes Taiwanese banks 1 year after setting up representative office in China to be eligible to apply for branch licenses, while it takes 2 years for foreign banks. Also, Taiwanese banks may apply for RMB business after 2 years of branch operation and 1 year profitable record while it is 3 and 2 years respectively for foreign banks.

As Taiwan has long been the top investor in China, she is familiar with and experienced in rules and regulations concerning doing business in China. With the unique shared culture and ECFA creating advantage in market access for Taiwanese companies in China, this is a good opportunity for UK companies who have interests in the Chinese market. Taiwan has lowered the profit-seeking enterprise income tax by 8 percentage points to 17% to attract more FDI, considering the positive experience from Singapore. Research from KPMG shows the negative relationship between the income tax and FDI. We encourage UK companies to take this advantage and invest in Taiwan.

Currently, there are approximately 300 UK companies investing in Taiwan, especially in the finance sector. Companies like Standard Chartered and HSBC have developed very well in Taiwan, and merged local Taiwanese banks and other international branches. There is also a lot of investment from engineering consultancies, and other small and medium enterprises. On the other hand, 70% of Taiwanese investment to the EU is in UK. Big corporations like HTC, Acer, ASUS and Evergreen have their marketing and R&D department based in UK. Taiwanese financial companies also have branches in UK. These facts show the close trade relationship between Taiwan and UK.

Moving Forward

Taiwan has one of the most dynamic service industries in Asia, built on the foundation laid by the strong manufacturing, ICT and EMC sectors. Currently, services in finance (banking, asset management, insurance), health, construction, green, tourism, education, R&D and cloud technology offers great opportunities for UK service providers in Taiwan and China.

ECFA not only facilitated cross-strait trade, but also attracted substantial attentions for FTA requests from Singapore, India, Indonesia, the Philippines and Japan. Taiwan signed an agreement on Liberalization, Promotion and Protection of Investment with Japan in 2011 to enhance trade relationship and set up an industrial cooperation office, as Japan is the 2nd largest trading partner and 4th largest source of FDI to Taiwan. Japan has taken this advantage to do business in China. And Taiwan has decided to focus on trade with countries including Vietnam, Indonesia, the Philippines, China, India, Russia, Brazil, Turkey, Mexico and Saudi Arabia.

Considering that EU is progressing FTAs with countries mentioned above, and there is a solid foundation of cooperation in financial services between UK and Taiwan, this creates potential for further engagement in trade and economic activities. Taiwan’s strong IT sectors can compliment and facilitate UK in service supply. Also, unlike the competition of automobiles between the EU and Korea, there is less conflict of interests in industry structures between EU and Taiwan. We believe this is a great opportunities for UK companies to develop trade relationship with Taiwan, and the Chamber and TWCSI would be glad to serve as the hub for such facilitation.