Industrial innovation forum touts green and innovative transition

Taipei, Dec. 21 (CNA) Taiwan's economy needs both a green transition and a transition away from over-dependence on information and communications technology (ICT) and semiconductors, according to speakers at a forum on industrial innovation and transition on Thursday.

The forum was held by National Taiwan University's Center for Technology Policy and Industry Development in Taipei, at which a government minister noted the need for a green transition and an industry leader called for greater economic diversification.

National Development Council (NDC) Minister Kung Ming-hsin (龔明鑫) said the green transition will be a much more important factor for enterprises than the "2 percent tariff," referring to China's announcement earlier on the same day that it will suspend tariff relief on imports of 12 Taiwanese petrochemical products.

As part of the global supply chain, there is a risk of losing out if Taiwanese companies fail to comply with net-zero or renewable energy requirements set by international clients, Kung said.

On the country's net-zero roadmap, Kung touted the announcement of the 2050 net-zero goal in April 2021 as "historical," while noting that even when it was announced, "there were misgivings about placing it at the top of the national agenda and giving it highest priority too early," he said.

The key 12 strategies envisioned in the roadmap -- including the development of green technologies such as wind and solar power and hydrogen energy, facilitating green finance, and increasing carbon sinks -- will help the country make both green and industrial transitions, the minister stressed.

Other than the industrial transformation this will entail, the economic implications will also impact the labor market, Kung said as he cited a 2022 McKinsey report estimating that while the world's net zero roadmap could create 202 million jobs in new industries, it will also cost 187 million jobs, the skills or purpose of which are no longer needed.

"A lapse in creating new jobs coupled with a drop in the old ones could put us in great trouble," he said, adding that is why the 12 net-zero strategies underline both new industrial developments and just transition, which is to ensure the transition is an inclusive and fair one.

The country's energy dependence on foreign imports could also be greatly reduced "from 97.4 percent in 2021 to below 50 percent in 2050," Kung said, "if we increase our renewable energy percentage to about 60 percent [of the energy mix] by then."

As of October this year, about 8.7 percent of Taiwan's energy was provided by renewables.

Placing doubt on the country's current over-reliance on the ICT and semiconductor industries, Tung Tzu-hsien (童子賢), chairman of Taiwan-based contract electronics maker Pegatron Corp., spoke about diversifying Taiwan's economy, especially the service sector, at the forum.

Taiwan's exports totaled US$479.52 billion and imports US$427.6 billion in 2022, for a surplus of US$51.9 billion, Tung said.

"However, 56 percent of the exports were technology-related products and components," he added.

While that is impressive, technologies are changing fast and even in the technology sector there is the risk of over-relying for Taiwan's prosperity on one single company Taiwan Semiconductor Manufacturing Co., which Taiwanese call "the sacred mountain protecting the country," he said.

Tung said that is why he has been investing in various fields including soft contact lenses, medical optics devices, biomedicine, and culture.

The Pegatron chairman is one of the largest shareholders in Eslite Bookstore and has made different investments in companies that produce creative content, according to local media reports.

Tung raised concerns about Taiwan's lagging service sector, where retail, banking and entertainment, to name a few, have performed in a lackluster way.

"A developed society always has a higher output value from the service sector than the industrial sector," so if growth lags in the former, the salary ceiling of young people -- a majority of whom work in the service sector -- will soon be reached, he warned.

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