The Taiwan advantage: AI, semiconductors, and ICT

Speaker A: Foreign. We managed to weather the storms. Taiwan's GDP growth rate uh last year was ah, 8.76% and that's among the highest in the world.

Speaker B: Taiwan is a small island nation producing 90% of the world's semiconductors.

Speaker A: This region is uh, very important uh, for Taiwan because it stands out for its innovation, resilience and uh, the very forward looking uh, digital developments. And as I said this happens to be uh, the areas Taiwan has a strength.

Speaker B: Welcome to Trade Treasury Payments, the podcast unlocking the future of cross border finance. From transaction making and money movements to

Speaker A: liquidity, treasury and cash management, we bring

Speaker B: you expert insights on the latest trends shaping global finance. I'm Dipash Patel, editor uh, at Trade uh Treasury Payments. Today we're in Riga, uh, Latvia. Uh, I'm delighted to be joined by Ambassador Vincent Ching Xing Yao, Taiwan Representative to the United Kingdom. And we're at the EBRD's Trade Facilitation Program information session and awards ceremony. Vincent, welcome.

Speaker A: Thank you.

Speaker B: Good to have you here. So two years ago we spoke in Yerevan, Armenia. We spoke about the trend contributing to Taiwan's growth. Um, back then manufacturing accounted for 70% of the economy. AI was trending, so was semiconductors. But a lot's changed around the world geopolitically a lot's also changed in Taiwan. What stood out and what have been the major trends since then?

Speaker A: Well, since then as we all know that uh, uh, geopolitical risk has been rising uh significantly. As we discussed earlier in the panel, uh, we also have seen uh, a serious uh, interruption uh in the global supply chains. So a lot of uncertainties. But among all these uncertainties there's another trend which is still consistent and we discussed that last time it was the rapid growth of AI. So against this backdrop, uh, Taiwan's performance in economy is actually doing pretty good. So we managed to weather the storms, uh, particularly in the past few years. For example, Taiwan's GDP growth rate uh last year was 8.76% and that's among the highest in the world. Uh, certainly this uh, uh performance is driven by the global demand in the AI industry. And Taiwan's actually sitting in the center of the semiconductor and AI uh industry ecosystem. So that's why Taiwan's continue to perform very strong economically.

Speaker B: Okay, brilliant. And obviously Taiwan is a small island nation producing 90% of the world's semiconductors and a large portion of the world's laptops, mother motherboards, functional textiles. What is the government doing to support that growth, to maintain Taiwan's competitiveness?

Speaker A: Uh, Our government has a very clear policy about the future uh industrial development. Our president has laid out a very uh comprehensive plan to develop that. We've called this uh trusted uh industrial sectors that include uh semiconductors, AI and security, uh and surveillance, next generation communication, uh system and finally our defense industry.

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Speaker A: So these five key uh sectors are ah the focus of Taiwan's future uh development and we've been uh pouring resources into these sectors and uh our governor also uh focusing uh on the establishment. We call this uh the 10 major uh infrastructure of uh AI industry. So we also set up a goal for developing the next generation technologies. That's uh silicon, photonic, robotics, quantum. So we have a very clear goal and the government is uh uh uh uh forcing all the resources to to go into this direction. Excellent.

Speaker B: Um and I guess Taiwan has been ah a trade partner of EBRD and particularly the Trade Facilitation Program since its inception in 1999. What exactly is Taiwan doing to work with those multilateral partners? Uh I think as I mentioned in

Speaker A: the donors meeting uh a couple of days ago now Taiwan has been working on uh 7 out of 11 multilateral funds uh in the EBRD. Uh and our bilateral technological corporation also focus on um several areas. One is smart mobility and cybersecurity and then uh human uh capital resilience and innovative finance and uh grain transition and finally SME uh development. So in these areas Taiwan has been working very closely with EBRD with the different uh programs and then uh we contributed to uh these areas because uh these areas happen to align with Taiwan strength. So we contribute in uh practical exchanges sharing experiences with uh the operation countries. Excellent. Right.

Speaker B: And I guess here we are in Riga. How does Taiwan view the Baltic States and the wider central Eastern European region to really facilitate and strengthen trade ties?

Speaker A: This region is uh very important uh for Taiwan because it stands out for its innovation, resilience and uh very forward looking uh digital development. And as I said this happens to be uh the areas Taiwan has strength. So uh we have been uh deploying uh our resources here in this region and to bring Taiwanese investment to this region. As a matter of fact uh, in Czech Republic, in Poland the five we uh call this uh big uh AI uh companies in Taiwan. Five major AI companies Taiwan all have been here and invested in this area. So uh, we also uh allocate central uh and Eastern investment fund and to help our business to invest in this area. So we increased our, uh, engagement in this area significantly.

Speaker B: Thank you very much. That was Ambassador Vincent Cheng Xiang Yao, uh, the Taiwan representative to the United Kingdom here in Riga at, uh, the EBRD Trade Facilitation Program annual meeting. Vincent, thanky.

Speaker A: Thank you very much for having me.

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Speaker A: Thanks for listening.