'Sourcing Taiwan 2009' Warms Up Chilly Export Business in Taiwan

The March 31 Chinese edition of the Economic Daily News paints a rosy picture of "Sourcing Taiwan 2009," the 4-day event organized by the Taiwan External Trade Development Council (TAITRA) and sponsored by the Bureau of Foreign Trade (BOFT) under the Ministry of Economic Affairs (MOEA) to promote export in the country that began on March 31 in Taipei. Taiwan suppliers likely landed orders totaling some NT$180 billion (US$5.45 billion at US$1 = NT$33).

Sourcing Taiwan 2009 attracted 735 buyers representing 548 enterprises from 63 countries, with 75 of the foreign businesses coming China, 46 from Japan and 34 from the United States.

Mostly Emerging Nation Buyers

Some 43 of the buyer countries are regarded as emerging markets, from which 376 enterprises were on-hand, accounting for 68.6% of the foreign participants; and the remaining 20 are developed countries, from which 172 enterprises came, for a 31.39% share. The number of businesses with annual revenue exceeding US$10 billion was 20 or 3.6% of the total, and that exceeding US$5 billion was 43 or 7.85%; while 234 had annual revenue over US$100 million, for a 42.7% share.

Other than the foreign participants, some 2,200 domestic enterprises were among the exhibitors, many of which are leaders in their fields, including Formosa Chemicals & Fiber Corp., Nan Ya Plastics Corp., Asustek Computer Inc., Uni-President Enterprise Corp., China Motor Co., Green Energy Technology Inc., etc.

To minimize human error and chance, TAITRA arranged between buyers and suppliers more than 13,800 in-person meetings. Moreover, Economics Minister Yiin Chii-ming also signed letters of intent with 10 foreign enterprises to affirm their outsourcing in Taiwan, including among others the Amalgamations Group, leader of India's lighting industry; Distribuidora Liverpool, Mexico's largest department store chain; Oxylane (Decathlon), the world's third-largest France-based sporting goods maker; ZF Lemfoerder, Germany's first-tier auto parts supplier; Agco Corp., the U.K.-based world's largest manufacturer of agricultural machinery etc.

Largest Ever

Yiin touted "Sourcing Taiwan 2009" as the largest event ever that actively invited buyers to Taiwan and may help warm up Taiwan's cool business climate due to the global economic recession. Besides, the signing of the letters of intent by 10 leading foreign enterprises show their considerable confidence in Taiwan-made goods. Yiin urged domestic manufacturers to build long-term relationships with buyers met at the event after landing spot orders.

C. K. Wang, TAITRA's chairman, confirmed the event's high degree of success and that TAITRA will again organize similar events. Sourcing Taiwan 2009 focused on promoting the island's thriving and most competitive industries, such as information technology (IT), telecommunications, opto-electronics, bicycle, hand tool, fasteners, auto and motorcycle parts; while one number certainly speaks for the suppliers of hardware, building materials and furniture: 242 buyers or 44% of the total came to source such goods.

WEF-rated No. 1

Wang emphasized that Taiwan manufacturers are remarkably strong in manufacturing capability and very aggressive to form industrial clusters that are effective, an achievement shown by the nation's being ranked No. 1 by the Switzerland-based World Economic Forum (WEF) for the development of industrial clusters in its 2007-2008 global competitiveness report.

Huang Chih-peng, BOFT's director general, noted that some of Taiwan's industries are regarded as global leaders, particularly the IT, electronics and telecom industries, hence the success of "Sourcing Taiwan 2009" to draw 175 foreign enterprises in such fields accordingly.

World-class Auto Parts

The numbers tallied are also testament to the quality of Taiwan-made auto parts: half of the top-10 foreign enterprises at the "Sourcing Taiwan 2009" are engaged in the auto parts industry, including ZF Lemfoerder, Magna International Decoma (Shanghai), Fiat Group China, Amalgamations Group, and PSA Peugeot Citroen.

ZF Lemfoerder makes chassis and transmission parts in Germany, posting revenues of US$1.7 billion in 2007, and has a global workforce of 57,000 persons across 119 plants worldwide.

Magna International is a Canada-based auto parts supplier. The company established its first automotive seating system manufacturing company in China in 1996, turning out mainly powertrain, interiors, seating, locks, metal body parts, chassis systems and parts, as well as provides vehicle development/design and vehicle assembly.

Fiat, the veteran Italian carmaker, raked in revenues of US$6.5 billion last year. The company has been active in China, running 13 subsidiaries, nine joint ventures and four representative offices there, with a total investment of nearly US$1.6 billion and workforce of 13,000 persons.

Established in 1938, the India-based Amalgamations Group engages in a wide range of auto businesses, including auto parts, diesel engines, cast parts, agricultural tractors etc. Its average annual revenues come to US$4.1 billion and major clients include Tata Motors, Hyundai Motors, Ford, Ashok Leyland and Caterpillar.

Sizable Stationery Order

Office Depot (Shenzhen) reportedly placed orders worth US$30 million with Taiwan suppliers. The U.S.-based company is the world's largest office furniture supplier and retailer, with more than 170 sales outlets globally that distribute about 14,000 office furniture and stationery items.

Mexico's Liverpool was among one of many interested in Taiwan's IT and telecom products and it was looking for an OEM at Sourcing Taiwan 2009 for its recently established brand-Onn, whose budget for 2009 is set at US$64 million.

Alliance Boots Sourcing is Europe's largest cosmetics and drugstore chain with annual revenues exceeding US$5 billion. With over 3,200 sales outlets worldwide and 110,000 employees, Alliance Boots' purchasing value this year is estimated to be about US$1 billion.

Estimated Business Generated at “Sourcing Taiwan 2009”
Sector	No. of foreign suppliers	No. of domestic suppliers	No. of one-on-one meetings	Estimated orders received (US$M)
Electronics/computer/communication	173	574	4,666	1568.15
Machinery	76	217	1,223	609.37
Auto parts/motorcycles	69	239	2,452	293.68
Hardware/building materials/furniture	63	242	1,168	62.3
Agricultural products/food processing machinery	41	204	969	457.06
Gifts/stationery/houseware	39	183	835	202.64
Miscellaneous	37	196	883	140.04
Medical equipment/healthcare	21	136	539	73.1
Textile/apparel	14	117	582	457.3
Bicycles/sporting goods	10	92	488	397.7
Total	543	2,200	13,805	4,261.34

Source: TAITRA

Top-10 Foreign Buyers at “Sourcing Taiwan 2009”
Name	Targeted items
Office Depot	Office furniture and stationery items
Alliance Boots Sourcing	Pharmaceutical and healthcare products, foldable baby carts, and sanitary items.
Charoen Pokphand (Shanghai)	Organic dry fruits, soft drinks, snacks, kitchenware, etc.
Amalgamations Group	Auto engines, batteries, transmission parts, pistons, clutches, etc.
ZF Lemfoerder	Sheet metal components in automotive applications, precision turning parts (steel & aluminum), etc.
PSA Peugeot Citroen	Auto interiors, seat covers, auto mobile phone holders, pads, batteries, etc.
Fiat Group China	Auto interiors, wheel hubs, rubber tires, auto glass, etc.
Distribuidora Liverpool	Multimedia auto & video products, IT items, home appliances, sewing machines, etc.
Magna International	Auto interiors, plastic tooling, metal parts, etc.
SPIE	Solar panel converter, cables, connecters, etc.

Source: TAITRA