Reshoring to Taiwan – Build Local, Sell Local – Po-Yuen Lin

Growing up in Taiwan, I often heard that products made in the United States or Europe must be superior in exchange for higher prices. But as many companies in the Western world started to outsource their production to China, it became more and more prevalent to see lower-end goods with the label “Made in China” on the products we saw in Taiwan.

Although Taiwanese consumers seek out American or European products and try to avoid Chinese-made goods due to the perceived poor quality or political element, Chinese goods still remain Taiwan’s largest category of imports. With the emergence of Korean and Japanese pop culture in Taiwan, consumers are also willing to pay extra for Korean and Japanese products that are endorsed by their favorite soap operas and pop stars.

Over time, Taiwanese consumers have come to favor products from Japan and Korea if they cannot afford the expensive options from Europe and the United States, and if they cannot afford Japanese or Korean goods, they buy Chinese-made products. There is not much room in the Taiwanese market for Taiwanese consumer goods. Yet Taiwan still dominates the global market for sophisticated and high-end industrial electronics such as semiconductors.

It is crucial for Taiwan to become more self-reliant, and build healthy economic relationships and partnerships with nearby countries, especially in Southeast Asia.

We need to rebuild our own production of consumer products for the domestic market. But as American companies bring their production back to the United States through Reshoring, Taiwan is losing, not building, its competitive edge. In addition, Taiwan’s heavy dependence on cheap imports from China, and the sensitivity of the political and economic relationship with China is having an effect on Taiwan. The market is in turmoil.

Innovation is the solution. Instead of re-creating existing products with mediocre quality, upper management in Taiwanese businesses should give younger talented engineers the creative room and opportunity to advance in innovation. We need to create new, high-quality products.

To create a sustainable and self-reliant society, I believe that Taiwan must break through the stagnant and highly dependent economy. At the same time, we need to rebuild Taiwanese pride by replacing excessive foreign goods with quality goods made in Taiwan, essentially “Reshoring to Taiwan.”

Po-Yueh Lin is a Student Researcher for the Reshoring Institute. He is pursuing a Bachelor of Business Administration at the University of San Diego majoring in International Business with a double minor in Supply Chain Management and Nonprofit Social Enterprise & Philanthropy, expected to graduate in May 2016.