As we approach full employment and wages rise, we do not have cheap labor.
Wages have along way to go to catch up to overcome the wage suppression you globalist caused. Hell, you traitors almost drove ud to true socialism. Screw you pal.
Posted on 05/12/2019 6:07:34 AM PDT by Tai_Chung
Taipei, May 11 (CNA) The ongoing trade dispute between Washington and Beijing will compel more Taiwanese firms operating in China to return to Taiwan to avoid the United States' punitive tariffs on goods made in China, a think tank predicted Friday.
Gordon Sun (孫明德), director of the Taiwan Institute of Economic Research's (TIER) Economic Forecasting Center, told CNA that Taiwanese companies may have no choice if the situation continues to deteriorate.
No agreement was reached in the latest round of talks as the trade friction between the U.S. and China escalates, which could lead to the U.S. imposing punitive 25 percent tariffs an additional US$325 billion worth of imported products made in China that are not already facing punitive duties.
U.S. Trade Representative Robert Lighthizer said his office is preparing those new tariffs.
"The US$325 billion worth of Chinese goods involve major electronics gadgets, such as smartphones and computers many Taiwanese firms roll out in China, and the impact could be major," Sun said.
Among the goods that would be affected are iPhones, and because many Taiwanese companies operating in China are part of Apple Inc.'s supply chain, they could suffer major blows from new tariffs, the analyst said.
"But let's think about the issue in a positive way," Sun said. "The development will lead more Taiwanese companies in China to speed up the pace at which they relocate operations back to Taiwan.
"Their investments are expected to become a driver of Taiwan's gross domestic product (GDP) growth in the second half of this year," he said.
After China apparently reneged on some of the understandings that had already been reached in trade negotiations between the two countries, the U.S. increased tariffs already imposed on US$200 billion worth of imported Chinese goods to 25 percent on Friday, from the previous 10 percent.
Many fear that could hurt global economic growth and demand and have negative consequences for Taiwan's export-oriented economy.
But while the TIER left its forecast for Taiwan's 2019 GDP growth at 2.12 percent, it did raise its projections for capital formation and private investment growth for the year because of the potential return of overseas Taiwanese companies.
It raised its forecasts for 2019 capital formation growth to 5.36 percent, from a 4.60 percent estimate in January, and for 2019 private investment growth to 4.10 percent, from an earlier estimate of 3.18 percent.
Data compiled by the Ministry of Economic Affairs (MOEA) showed that 52 Taiwanese companies operating abroad have pledged to invest NT$279.5 billion (US$9.05 billion) in Taiwan so far this year amid trade worries.
The MOEA offered an incentive package in January to encourage Taiwanese companies that shifted their operations overseas in recent decades, especially to China, to return to Taiwan to invest.
The incentives include better access to bank loans, a simplified process for recruiting migrant workers, and services tailored to their needs.
According to the MOEA, the 52 firms are expected to create more than 27,000 new jobs for Taiwan. Their pledges have topped a goal set by the government to encourage NT$250 billion in investment by these companies, and on Thursday, the Executive Yuan raised the 2019 goal to NT$500 billion.
The Bureau of Foreign Trade (BOFT) said the tariff hikes on US$200 billion worth of Chinese goods have affected China-based Taiwanese makers of internet communications devices, low to mid-range bicycles and electronics components, and vendors in those product categories seem most eager to return to Taiwan.
The BOFT cited the latest trade data to show that many overseas Taiwanese businesses have taken steps to adjust their production by relocating funds back to Taiwan to diversify risk amid the U.S.-China trade dispute.
According to the data, while Taiwan's exports in the first four months of 2019 fell 4 percent from a year earlier amid slower global demand and an unfavorable trade environment, its exports to the U.S. market were up 19.9 percent year-on-year.
Roy Chun Lee (李淳), deputy director of the Taiwan World Trade Organization and Regional Trade Agreements Center of the Chung Hua Institution for Economic Research, said Taiwanese companies in China should reduce their share of production in Chinese factories in view of the trade tensions.
"But do not withdraw completely from China for the moment as it remains possible that the two economies pull off a surprise and resolve their dispute," Lee said.
"We have to keep in mind, however, that the trade issue has been brewing for a long time, so what Taiwanese companies should do is hedge their bets over the longer term by diversifying production."
While welcoming more overseas Taiwanese businesses returning home, Sun was still concerned about the impact of tariffs on the additional US$325 billion worth of Chinese goods.
Sun said he was afraid that the escalation in trade tensions would send ripples through global financial markets, which Taiwan would not be able to avoid.
A report from UBS concluded that the Chinese yuan could suffer further volatility if trade tensions get worse, which could affect regional currencies.
The yuan fell 1.4 percent against the U.S. dollar this week, reversing an uptrend seen since November 2018 when it nearly hit 7 yuan to the dollar.
It lingered at the 6.7 yuan level for much of April before weakening to 6.82 against the dollar on Friday.
I've been to Taiwan. The people are friendly and industrious. This is a good thing.
How about bring the jobs back to the USA? It has plenty of cheap labor, energy and natural resources.
I learned a long time ago that the only fair tax is the tax that taxes you and not me. It sounds like the same rule applies to tariffs as well.
Chi-coms and China has grown as a result oe taking advantage of our stupidity for quite some time.
A serious downturn in the economy leaves many out and makes for trouble.
Good.
After China apparently reneged on some of the understandings that had already been reached in trade negotiations...
I didn’t know that. Definitely something the MSM doesn’t want folks to know.
And it’s crazy that Taiwan businesses operate in China. That’s good. Usually economic ties reduce the chances of war.
Usually.
Or maybe I’m completely wrong :) It happens a lot.
Lowering income taxes and raising import tariffs used to be standard Republican Party fare.
Maybe they will fill their ghost cities with unemployed workers.
As we approach full employment and wages rise, we do not have cheap labor. With a $15 minimum wage in several places, we have a wage gradient across the USA.
And then you advocate bringing back all jobs for which there are no workers to fill . The result of your sermons is importing labor. The logical conclusion is open borders to which you logically ascribe.
Come on Foxconn (and other Taiwan businesses), you can do it. YOU SNOOZE, YOU LOSE.
As we approach full employment and wages rise, we do not have cheap labor.
Wages have along way to go to catch up to overcome the wage suppression you globalist caused. Hell, you traitors almost drove ud to true socialism. Screw you pal.
I would be very happy if jobs were transferred from China to a friendly country. Even a country like Vietnam would be better if they don’t require a technology transfer or threaten the US.
Not all jobs will be transferred to the US.
The US should not have normal trade with communist countries. Friendly nations should have better terms than unfriendly ones.
What will be most impacted here which will drive up prices is modifications to the supply chain. Local vendors used will need to change, ports will change, timing of the routes, weather conditions all will have to be dealt with as part of the change.
The manufacturing part is the simple piece.
But that should be the official goal of US economic and tax policy at this point.
Yes.
I am currently peripherally involved in a project where an American plant of an EU company merged with a larger American company has subcontracted some fabrication and assembly to works in China.
The equipment to be assembled is produced by several American vendors and some EU vendors. Since the ultimate destination is not America, I don’t think tariffs will be an issue.
Keeping track of it all and keeping the schedule on track is a real, real challenge for the project manager.
More evidence of President Trump’s ultimate end game plan to get manufacturers to abandon China. Trump is not only getting American and European manufacturers to abandon China but now he is getting not only Taiwanese but nationalist Chinese manufacturers supplying the US considering abandoning their own country as well for Cambodia and Vietnam to avoid the tariff and be able to compete. Ultimately there will be no jobs available in China and the final touch will be when joblessness punctures their real estate bubble sending the yuan into a tailspin and parasitic tech thieving China will return to the Third World agrarian society they deserve to be under their communist government.They will fold to Trump at every turn in the negotiations.
The goal should be to bring it home. Otherwise it will be SSDD
You gloBULLists are not listening. The goal is to bring manufacturing back to the good old USA!
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