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Support for the machine tool industry's ongoing development

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Taiwan was the world's fifth-largest exporter of machine tools in 2018, based on dollar amount. The industry is a pillar of the machinery sector, providing the critical support that has enabled the entire sector's production value to surpass NT$1 trillion (US$32.8 billion) for two years in a row. The opening of the U.S.-China trade war in July 2018 together with global economic uncertainty has led to industry declines in major machine tool manufacturing economies such as the U.S., the EU and Japan. Taiwan is no exception, with exports likewise affected. In response, multiple ministries and agencies are cooperating on a coordinated plan to help extend development of the machine tool industry and identify opportunities amidst the downturn.

Responsive strategies

Access to financing: In addition to tax credits on purchases of smart machinery as provided for in the Statute for Industrial Innovation, the government provides manufacturers with funds through policy-directed loan programs. Also available are preferential loans, complimented by discounts or waivers of processing fees, aimed at ensuring adequate financing for businesses.

Greater demand: Domestic market demand will be boosted by encouraging the public and private sectors to replace older equipment and attracting new investment from returning China-based businesses. On the international front, the government and manufacturers are stepping up the organization of a Taiwan machinery purchasers alliance, opening strategically placed business centers to clear channels in overseas markets, taking advantage of opportunities presented by the relocation of secondary production facilities to New Southbound countries, and inviting overseas purchasers groups to Taiwan.

Industry transformation: Subsidies and payments will be provided for worker skills development, employer-sponsored on-the-job training, and government-administered technology development programs to encourage furloughed workers to seek supplementary training. Efforts will also be devoted to strengthening technical research and development capabilities and cultivating talent, including the establishment of professional talent development centers for high-level blue collar workers.

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