Premier announces new plan to assist small businesses

This article was published by the Macroview Weekly on June 27, 2007. It reports that the government in Taiwan will fulfil a policy promise to “take care of small and medium businesses” by investing NT$10 billion of the official National Development Fund in small firms and bolstering efforts to guide the transformation and upgrading of Taiwan's small business sector.

After a report on measures to support small and medium enterprises delivered by the Ministry of Economic Affairs, government officials stated that Taiwan's small and medium enterprises “are an important pillar in Taiwan's economic development, employment and the stability of our society”.

“Their flexible, aggressive and innovative enterprising spirit also provide the foundations that drive Taiwan's economic development and social stability,” officials said.

According to recent data provided by the Ministry of Economic Affairs, Taiwan had over 122,600 small and medium enterprises in 2005, or nearly 98 percent of the total number of business firms, and accounting for over NT$10 trillion in total sales.

The number of small companies rose 15.6 percent from 1999 and total revenues had risen 26.6 percent during the 1999-2005 period.

Moreover, small and medium firms in Taiwan employed 7.65 million workers, up by 300,000 since 1999, or nearly 77 percent of the total workforce. These firms also accounted for NT$1.52 trillion in direct exports or 17.6 percent of Taiwan's total merchandise exports in 2005.

“The efforts of small and medium businesses deserve everyone's approval and the government should do its best o resolve and remove the obstacles these enterprises face,” government officials said.

The Ministry of Economic Affairs has already allocated NT$23.6 billion in its budget in 2007, compared to the average annual allotment of NT$15.5 billion, to provide assistance to small and medium firms in capital, research and transformation, innovation and incubation, cultivation of human talent and assistance in securing land.

However, officials stated that the government needs to take stronger initiatives to respond to the actual needs of small businesses in response to rapid changes in domestic and global markets.

The government has primarily used the National Development Fund in the past to invest in large enterprises. The NT$10 billion in investments in small businesses to be invested by the official fund will drive a total of NT$50 billion in new investments and boost employment by over 20,000. Beginning in August 2007, the official fund will accept applications for investment funds.