Features

Make way for Taipei

24 Nov 2010 by AndrewGough

Improved air links and a more open approach to overseas trade are helping this Asian Tiger roar ever louder, says Jenny Southan

Forge your way through the heaving aisles of Shilin night market, where skimpy maid outfits and fake Converse trainers sit alongside exotic fruit and stinky tofu, and you’ll get a good sense of what life on the ground is like in Taipei. With its glowing neon signs and caterwauling street sellers, you could be forgiven for thinking you were in any number of Asian cities, but don’t be fooled – Taiwan’s capital is unique.

Much has happened in recent years to bring it into the 21st century. Xinyi District in the east has emerged as a high-powered business centre, marked by the 2004 opening of Taipei 101, the world’s tallest skyscraper until Dubai’s Burj Khalifa was unveiled last January. A Taiwan Tourism Bureau spokesperson says: “Taipei’s movement towards sophistication and internationalisation began speeding up in the 1990s, and the city has smoothly transformed into a major metropolis. Skyscrapers and high-end residences have sprung up everywhere and the infrastructure has improved rapidly, with railroads being put underground and a mass rapid system added to the transportation network.”

Still, Taiwan perhaps remains better known for its conflicted relations with China. The island state, known officially as the Republic of China (ROC), is separated from the mainland by the 160km-wide Taiwan Strait but for decades has also been cut off from the rest of the world both politically and economically. From 1895 to 1945 it was ruled by the Japanese, who relinquished it at the end of the Second World War to the Kuomintang (KMT), the ruling party of the ROC. But the People’s Republic of China (PRC), which forced the ROC to retreat to Taiwan from the mainland in 1949 after the Chinese Civil War, also argues for the right to sovereignty. Travel and trade between the two have therefore been restricted for many years, and only now are relations beginning to improve.

In June, Taiwan signed a pact with China, the most significant act of reconciliation since the split. The Economic Co-operation Framework Agreement saw the lifting or reducing of tariffs on 539 Taiwanese mechanical tools, equipment, chemical materials, automotive components and agricultural products, as well as on 267 Chinese goods. About US$14 billion worth of Taiwanese goods and US$3 billion of Chinese products will benefit from the cuts. At the same time, Taiwanese carrier Eva Air added six flights a week between Taipei and Shanghai.

The country has seen sustained economic growth since the 1960s, thanks mainly to its huge success as a manufacturing hub for electronics and other consumer goods. Unlike the communist mainland, it enjoys a capitalist economy that thrives on the export of these products – about 70 per cent of its GDP is created this way and it is estimated that about two out of every three laptops, more than two-thirds of LCD monitors and four-fifths of PCs are produced here, despite it being one-seventh of the size of the UK in terms of land mass. Thanks to former KMT leader Chiang Kai-shek, who transferred much of China’s gold reserves to the island during his takeover, it also has the world’s fourth-largest foreign exchange reserves.

One country that has been thirsty for Taiwanese goods is the UK – it imported £2.96 billion worth in 2009 – and several measures have recently been taken to enhance relations between them. In March 2009, the UK started to allow Taiwanese passport holders entry for trips of up to six months without a visa and, a year later, Taiwanese flag carrier China Airlines became the first to launch nonstop flights between Taipei and the UK. The thrice-weekly service is operated by a two-class A340-300 and gets into London at about 1600 on Tuesdays, Thursdays and Sundays, departing for Taipei later in the evening. (For flight reviews see businesstraveller.com/tried-and-tested.)

Stephen Metti, head of trade and investment for the British Trade and Cultural Office in Taipei, is keen to promote ties between the two countries, particularly in the creative industries. “Designing more attractive consumer goods means more people will buy them,” he says. “Some [Taiwanese] brands have been seen as cheap but now with the right marketing are up there with the leaders – for example, HTC launched its phones from London and sees itself as an international company. Acer is a sponsor of London 2012.”

He adds: “We promote British products and excellence in particular sectors – for example, we had a rail mission come to Taiwan led by the Railway Industry Association, so we were able to go into government departments to lobby on behalf of British companies bidding for rail projects in Taiwan. We have also had an exhibition come twice to Taiwan called ‘Love and Money – 50 Years of Creative Britain’. Couple Taiwanese electronic consumer products with British design and you have something that is highly desirable.”

The island nation is also looking to the UK for guidance on the environment. Metti says: “We have been working with Taiwan on climate issues, providing expertise and knowledge on how to reduce its carbon footprint. I think climate management is something the UK can help with as Taiwan wasn’t a signatory to the Kyoto agreement and only went to Copenhagen as an observer, but this is no reason for it not to participate in reducing its carbon footprint.”

With this increased emphasis on cultural and commercial exchange between the countries, what’s it like to do business in Taipei these days? Metti, who is from the UK but has lived in Taipei for about two years, says: “If you look around, you still don’t see many Westerners here – tourists tend to be Taiwanese, Chinese or Japanese – so the most important thing is to prepare for your trip. Taiwan is unique – if someone has been to China, Hong Kong, Japan or Korea they will know those markets, but Taiwan is different again. Carry out market research.” (The British Trade and Cultural Office can help with this, as well as arrange itineraries and identify contacts.)

He says: “It’s all about building relationships – it’s important to make the contacts but also to maintain them, making sure you come across as a credible person who is willing to invest in the relationship. This will go a long way as the better a Taiwanese person knows you, the better they can promote your product or service over here. You should also bring plenty of business cards if you want to be remembered.

“It is important to show an interest in Taiwan – if you have a spare morning or evening, take the time to visit places of interest such as the night market. To be able to say: ‘Yes, I have been to the National Palace Museum, Yangmingshan National Park, Sun Moon Lake and Taroko Gorge’ goes a long way when you speak to people.”

Will Chen, executive assistant manager of rooms, sales and marketing at the Sheraton Taipei hotel, has more valuable tips. “A lot of business is done over the dinner table here, usually accompanied by a lot of toasting,” he says. “So if you are invited to dinner, go, and if your host toasts you, you should return the toast at least once during the dinner. Plus, try to learn at least a few words of Chinese – people will really appreciate it if you try to speak the language.”

That said, Chen notes that doing business in Taiwan is not nearly as challenging as it was ten or 20 years ago. “Regulations have been eased considerably and the government has made concerted efforts to attract foreign investment through incentives. Political stability with mainland China is making Taiwan an attractive base for foreign companies,” he says.

Michael Liu, assistant vice-president of the Taipei Financial Centre Corporation, which owns the US$1.7 billion Taipei 101, says: “We were required by the government [to lease more than 50 per cent of space to] financial institutions. Our first tenant was Bayer from Germany, then we had L’Oréal from France, Bank of America, Google, McCann, KPMG, ANZ and the Taiwan Stock Exchange.” The design of the building is intended to give them a helping hand in their endeavours – it is composed of eight segments, each containing eight floors, significant because in China the number eight is associated with prosperity and good luck. Xinyi District is also home to shopping malls, government offices and the Taipei World Trade Centre, so is probably where business travellers will spend most of their time.

Tourism is also a burgeoning area. A record number of visitors came to Taiwan in 2009 (4.4 million, including almost 45,000 from the UK), and the Tourism Bureau recently announced approval for 37 large international hotels, business and boutique properties across the island, which will increase the number of rooms by more than 10,000. High-end properties in Xinyi include the 856-room Grand Hyatt and the brand-new 160-room Le Méridien, which was set to open on December 1. Starwood’s W hotel on Zhongxiao East Road is to launch on February 14 with 405 bedrooms. A 300-room Mandarin Oriental is on the cards for 2012, as is the 208-room Okura in the western district of Zhongshan. (For more on the hotel scene see “Taipei – new blood”, asia.businesstraveller.com/asia-pacific/archive/2010/march-2010.)

This flurry of openings joins a number of new science and software parks and an £80 billion infrastructure project, i-Taiwan, encompassing transport, urban renewal and environmental protection (visit cepd.gov.tw). Add to this the growing number of English signs visible across the capital, and the improved accessibility by air, and it all signals a new dawn for the mighty Asian Tiger.

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