Wednesday, August 24, 2016

James Huang's Talk of “Ants" Demeans Taiwan

James Huang's Talk of “Ants" Demeans Taiwan
United Daily News Editorial (Taipei, Taiwan, ROC) 
A Translation 
August 24, 2016

Executive Summary: The New Southern Strategy is a new frontier for foreign investment, not a panacea for the phenomenon of businesses “Going West”. It is an opportunity for industrial restructuring, not a weapon to use against the Mainland. James Huang's talk of “ants” misjudges reality and demeans Taiwan.

Full Text Below:

James Huang is the Director of President Tsai's "Office for New Southern Strategy". Recently, during a discussino of external economic strategy, Huang said "The Mainland China market is full of elephants. If an ant enters, what can he possibly get out of it?" His remark was wrong on two counts. First, it was self-demeaning. It reduced Taiwan businessmen to the status of ants. Second, it was an admission of strategic confusion. Expanding southward is about diversification. It is not an either/or proposition. Expanding southward and remaining part of the Mainland market are not mutually exclusive.

As the head of the Office for New Southern Strategy, James Huang's talk of ants was a serious faux pas. It reflected the government's lack of vision, and lack of concrete plans for implementation. Taiwan businessmen have been operating on the Mainland for over 20 years. The Hon Hai Group alone employs nearly one million people. How can James Huang use the term "ants" to describe Taiwan businessmen? One reason of course, is the DPP's hatred and ignorance of “China”, i.e., the Mainland Area. But when push comes to shove, they suddenly become so humble. Besides, if they truly see themselves as mere "ants", how can they possibly muster up the courage to “Go south”?

The New Southern Strategy substitutes wishful thinking for hard reality. This is its a blind spot. The new government is blind to its own self-demeaning assumptions. It cannot define a clear goal. It cannot map out a clear path. Yet is demands that everyone “Go south!” In fact, this very dangerous. One example is enough to make everything clear.

President Tsai has proposed a New Southern Strategy, including 10 Guidelines for Action. Meanwhile, Tamkang University's Southeast Asian Studies Research Institute, which has been around for 20 years, was closed down in August for lack of student interest. Currently only Jinan University still has a Southeast Asian Studies Institute. Lee Teng-hui began urging people to “Go south!” when he was president. But the research institutes established in conjunction with the policy still cannot attract any interest. As we can see, the government has yet to get past mere sloganeering. It cannot induce students to conduct research. Even more ironically, the Tsai government recently sounded a clarion call for its New Southern Strategy. National Chengchi University, the Taipei University of Education, and other schools applied to establish Southeast Asian Studies Institutes. Will they become the academic counterparts of the “egg tart fad”? That is deeply worrying.

Will this external policy succeed? That depends on whether it involves bilateral mutual benefits, or merely unilateral wishful thinking. The DPP has upgraded the status of the New Southern Strategy to "the nation's overall foreign trade strategy". It ignores the close political and economic relations the nations of Southeast Asia have with the Mainland. The government is shrilly egging people on. But all anyone sees is abstract goals with no concrete path. When entrepreneur Dai Sheng-tong “followed in the government's footsteps" and invested in Haiti, he lost his shirt and was eventually forced to close up shop. Does the government intend to bear responsibility for any future losses?

Ten nations in Southeast Asia have 650 million people. They are the world's youngest market. Naturally they have their place. But government policy must be more economics and less politics. Only then will it be consistent with the needs of the domestic economy, domestic employment, and the limitations imposed by international political realities. Japan's Southern Strategy has been the most successful one of its kind. We may be able to learn from their experience.

Japan began promoting its Southern Strategy during the 70s. The strategy was developed by the government's  External Trade Organization and the Asian Institute of Economic Research. Together they established the official "trinity" for economic strategy. First, in the name of economic aid, they helped local businesses enter the domestic market. The Japanese government loaned yen and provided infrastructure, enabling Japanese companies to assist Southeast Asian countries in highway and airport construction. This enabled them to enter the Southeast Asian market. By contrast, Taiwan businesses are merely investors in Southeast Asia. They merely take advantage of cheap labor. They do not find their way into the local domestic market.

Secondly, Japan understood the importance of cultivating talent in Southeast Asia. Japan's External Trade Organization helped businesses cultivate talent within Southeast Asia. It set up Southeast Asian language classes and economic and cultural classes. It provided professional advice for businesses entering the Southeast Asian market. This advice was specifically tailored to the industry's market strategy. By contrast, the government on Taiwan assumes that merely knowing English enables one to communicate with anyone in the world. University students have little interest in Southeast Asian languages. Companies are unable to recruit anyone with Southeast Asian language proficiency. This makes it difficult to lay down local roots.

Finally, Japan conducted in depth research on Southeast Asia. To promote its Southern Strategy, the Japanese government established an "Asian Economic Research Institute" to conduct long term analysis of the 10 nations of Southeast Asia. Each year, it publishes a political and economic white paper on Southeast Asia. By contrast, Taiwan's Southeast Asian Studies are scattered among various universities and research institutions. The lack of integration weakens our studies on Southeast Asia.

The New Southern Strategy is a new frontier for foreign investment, not a panacea for the phenomenon of businesses “Going West”. It is an opportunity for industrial restructuring, not a weapon to use against the Mainland. James Huang's talk of “ants” misjudges reality and demeans Taiwan.

2016-08-25 03:38 聯合報 聯合報社論











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