AmCham arrow Publications arrow Topics Archive arrow Topics Archive 2004 arrow Vol.34- No.4 arrow Editorial: An End to Neglect of Services?
Editorial: An End to Neglect of Services? PDF Print E-mail

One of AmCham's concerns in recent years has been whether swift enough action is being taken to promote development of a robust service sector, particularly one geared to high-value, knowledge-based services. In many of the Chamber's discussions with government agencies about economic policies, officials often appeared to display a mind-set still oriented toward the manufacturing industries that traditionally represented the core of Taiwan's economic strength. Despite the steady move offshore of many of those industrial sectors in pursuit of lower production costs over the past decade, the potential importance of services as a new driver of economic growth and employment opportunities did not seem fully appreciated. And even though the service sector in Taiwan has already expanded to the point that it accounts for two-thirds of gross domestic product, the impression remained in many quarters that service jobs (aside from those in financial services) are typically low-skilled and poorly paid -- the kinds of jobs frequently derided as "hamburger flipping."

 

Given that background, it has been gratifying to learn that the government is now actively pressing ahead with a plan for service-sector development. A report recently prepared by the Council for Economic Planning and Development (CEPD) fully recognizes the vital importance of heightened government attention to this sector. It sets numerical goals for growth rates, output value, and employment to be obtained over the coming four years. More significantly, it calls for the revision of 534 laws and regulations as well as adoption of dozens of specific development strategies to facilitate service-industry expansion and upgrading. And it zeros in on 12 service sub-sectors -- among them health care, human resource training, materials management, design services, and information services -- as examples of the high-value, highly skilled fields that Taiwan needs to foster.

The response to the report from Premier Yu Shyi-kun was also encouraging. Showing his awareness that the level of service quality and sophistication has to be raised for Taiwan to maintain global competitiveness, Yu urged government agencies to accelerate efforts to adjust the regulatory environment and accelerate vocational training programs to help service businesses to flourish. He designated CEPD as the body responsible for coordinating activity and monitoring progress within government toward these objectives.

The direction outlined by CEPD and confirmed by the premier is correct. Now it will be up to the various ministries and then the Legislative Yuan to ensure that necessary changes in laws and regulations are accomplished as speedily as possible.

As Taiwan moves toward creating a knowledge-based economy, the technical expertise it needs to rely on will be found in the service sector at least as much as in manufacturing. Much of that expertise can be promoted domestically most efficiently by taking advantage of experience and technology that already exists abroad. Through consultation meetings with government agencies and during the public hearings on proposed new legislation, AmCham and the multinational corporations that it represents look forward to contributing to the process of developing Taiwan into a vibrant center for world-class services.