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Taiwan Fastener Industry Seeks Government Help in Light of RCEP Impacts
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2020-11-30
     Taiwan Ministry of Economic Affairs (MOEA) met with representatives from Taiwan Industrial Fasteners Institute (TIFI) and other associations at a conference discussing the RCEP impacts on industries. Before the conference, TIFI chairman Tu-Chin Tsai said in an interview that Taiwan fastener industry was ranked third in the world, but that its production value dropped from NTD 176 billion in 2018 to NTD 143 billion in 2019, and it is fairly questionable whether the value can reach NTD 110 billion as a result of the high NTD exchange rate and other countries' high tariffs on Taiwanese fasteners.
 
     According to Tsai, NTD appreciated by 12%-15% over the past 2 years, resulting in an annual loss of NTD 5 billion to Taiwan fastener industry. As a result, he is calling for NTD depreciation. Meanwhile, an average 5%-30% tax is imposed on Taiwanese fasteners exported to ASEAN.

     He thinks that RCEP has no impact on domestic electronics, 5G and medical industries, which are strong performers in Taiwan. Taiwan fastener industry is a decent performer in aerospace, automobile and electronics, but faces tough competition coupled with negative factors in exchange rate and tariff. "Without industrial competitiveness, we may need to look towards domestic plant closures or offshore migration of business activities"

     Mr. Tsai Yong-Yu, TIFI vice president and president of Jinn Her Enterprise, said that the industry had already deployed in Southeast Asia as part of Taiwan government's New Southbound Policy. The branches in Southeast Asia aim to export products to high-end markets in the U.S. and Europe and bring competitiveness to the industry, but the pandemic has put a halt to export. With no improvement visible through to the second quarter of 2021, he hopes the government will help by ways such as depreciating NTD.
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