Economy of Taiwan - Science and Industrial Parks

Science and Industrial Parks

In order to promote industrial research and development, the government began establishing science parks, economic zones which provide rent and utility breaks, tax incentives and specialized lending rates to attract investment. The first of these, the Hsinchu Science Park was established in 1980 by the National Science Council with a focus on research and development in information technology and biotechnology. It has been called Taiwan's "Silicon Valley" and has expanded to six campuses covering an area of 1,140 hectares (11.4 km2). Over 430 companies (including many listed on TAIEX) employing over 130,000 people are located within the park, and paid in capital totaled US$36.10 billion in 2008. Both Taiwan Semiconductor Manufacturing Company and United Microelectronics Corporation, the world's largest and second largest contract chipmakers, are headquartered within the park. Since 1980, the government has invested over US$1 billion in the park's infrastructure, and further expansion for more specialized parks have been pursued. The Industrial Technology Research Institute (ITRI), headquartered within the park, is the largest nonprofit research organization in Taiwan and has worked to develop applied technological research for industry, including for many of Taiwan's traditional industries (such as textiles).

Following the success of the first park, the Southern Taiwan Science Park (STSP), consisting of the Tainan Science Park and the Kaohsiung Science Park, was established in 1996. In addition to companies, several research institutes (including Academia Sinica) and universities have set up branches within the park with a focus on integrated circuits (ICs), optoelectronics, and biotechnology. The Central Taiwan Science Park (CTSP) was established more recently in 2003. While the CTSP is still under development, many firms (including AU Optronics) have already moved into the park and begun manufacturing operations. Like the other parks, CTSP also focuses on ICs, optoelectronics, and biotechnology, with the optoelectronics industry accounting for 78% of its revenue in 2008. These three science parks alone have attracted over NT$4 trillion (US$137 billion) worth of capital inflow, and in 2010 total revenue within the parks reached NT$2.16 trillion (US$72.8 billion).

The Linhai Industrial Park, established in Kaohsiung in 1960, is a well-developed industrial zone with over 490 companies focusing on other industries including base metals, machinery and repairs, nonmetallic mineral products, chemical products, and food and beverage manufacturing. The Changhua Coastal Industrial Park, located in Changhua County, is a newer industrial cluster with many different industries such as food production, glass, textiles, and plastics.

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