BY DENIS DUPéE

Although most Americans working and living in Taiwan and many Taiwanese working for U.S. companies have had some contact with the American Institute in Taiwan (AIT) – most often to renew a passport or obtain a visa – their knowledge of AIT is generally rather limited. The aim of this article is to fill in some of the gaps by examining AIT's functions, particularly as they relate to five of the departments that have the most frequent connection with the U.S. business community: the Commercial, Agricultural, Economic, Consular, and Public Affairs Sections.

AIT was established by Congress in 1979 under the Taiwan Relations Act, which defined the structure of the U.S. relationship with Taiwan following Washington's diplomatic recognition of Beijing earlier that year. Technically, AIT is a private, non-profit organization operating under a contract with the State Department. Of its approximately 450 employees, about one-quarter are American, and the rest are locally engaged employees, the vast majority from Taiwan.

According to AIT's Public Affairs Section, the Institute takes its “best practices” from procedures at U.S. embassies and consulates around the world, with the result that there are more similarities than differences between AIT and normal American diplomatic missions abroad.

While specific practices have evolved since AIT's inauguration, its basic purpose of facilitating substantive interaction between the peoples of the United States and Taiwan remains essentially the same. The Institute is committed to enhancing Taiwan's security and democratic development and to strengthening the U.S.-Taiwan economic relationship.

Aside from its offices in several locations in Taipei (the headquarters is on Section 3 of Xinyi Road), AIT has an office just outside Washington, D.C., in Arlington, Virginia, as well as a branch in Kaohsiung. It plans to consolidate the Taipei operations in a new building in Neihu, for which construction is scheduled to begin next year. More information on AIT can be found on its webpage: http://www.ait.org.tw/.

Commercial Section

The Commercial Section is charged with facilitating the entry and expansion of American goods and services into the Taiwan market. Unlike AIT's Economic Section, which primarily addresses policy issues, the Commercial Section focuses on providing services to individual American companies, often for a nominal fee.

According to Section Chief Gregory Wong, the Commercial Section has 23 staff members, many with advanced degrees and decades of experience, and offices both in Taipei (on the 32nd floor of the Taipei World Trade Center’s International Trade Building) and in Kaohsiung. Of the roughly 230 such offices in the world, Taiwan's is the eighth-largest, a testament to Taiwan's status as the United States' ninth-largest trading partner overall and tenth-largest export market.

One of the Commercial Section’s key roles is to help American companies interested in entering the Taiwan market for the first time. These businesses, says Wong, tend to be small and medium-sized enterprises, often with limited resources. Through the Commerce Department’s Gold Key program, the section assists them for a small fee by conducting market investigations, introducing potential local business partners, setting up meetings, translating their promotional materials into Chinese, and generally providing guidance and advice.

“We also work with American companies that are already present in the market to carry out promotions,” notes Wong. “They may not have been getting the reach that they could achieve.” For such companies, the Commercial Section puts on promotional seminars, usually in its facilities at the Taipei World Trade Center. This type of service, known as Platinum Key service, is offered for a charge of about US$1,000, depending on the needs of the client.

Sending out invitations to such promotional events under AIT’s name makes a big difference, says Wong. “First of all, we have a different contact list than our clients do, and secondly, when someone receives a fax from AIT, it gets read. We're very, very successful at attracting the right people – lots of them – to these technical seminars, which are really sales-promotional seminars by another name. It works for construction materials; it works for investment services and other services – in fact, it can work for virtually any product or service you can think of.”

Wong says the Section would welcome more U.S. companies to use this service. “The companies that know it, use it, but they tend not to tell other people because it's a nice secret to have,” he notes. “We would love it if more AmCham members were to take advantage of this service.”

An example of a recent promotional project by the Commercial Section in conjunction with AIT's Agricultural Section and Mitsukoshi department stores was “America Month,” an event to promote American retail products. One hundred seventy U.S. retail brands participated this year. The program featured Country-Western singers, break dancers, hula dancers, as well as educational seminars and lucky draws giving away tickets to Disneyland to attract consumers to the special American product displays.

In addition, the Commercial Section organizes American pavilions and events at local trade fairs, including Semicon (where more than 300 U.S. companies exhibited), Computex, the Taipei Cycle Show, and the Taipei Book Fair. Wong suggests that U.S. companies interested in participating in these trade fairs in Taiwan go through AIT in order to obtain the best rates and participate in AIT-sponsored receptions and other events during the show.

On trips back to the United States, Wong frequently speaks to American business audiences about trade and investment opportunities in Taiwan, and he and his colleagues are constantly in touch with Taiwan companies looking to do business with the United States.

Wong says he is especially proud that his office has ranked number one in the world among U.S. Commercial Sections in terms of its customer-satisfaction record and fourth in the number of deals that it has facilitated. “This year we've helped 663 companies make 377 sales totaling US $292 million,” he notes. “We're very results-oriented – and there's no industry we don't cover.” When U.S. companies in Taiwan face difficulties because of government policies or regulations, Wong suggests that AIT's Commercial Section – utilizing its lines of communication with the Taiwan authorities – can help complement AmCham's own advocacy efforts on the companies’ behalf. “It gives you two leverage points instead of one,” he says.

Following his interview with Taiwan Business TOPICS, Wong attended a meeting of AmCham's See America Committee, which he hosted in a conference room at the AIT Commercial Section. He noted the availability, at competitive rates, of his office's attractive function rooms, which can add gravitas to a promotional gathering that may be lacking at a hotel or other facility.

While noting that Taiwan can “sometimes get lost in the bright glow” of China, Wong says that Taiwan is a solid and relatively easy market for American companies to penetrate, in contrast to more high-maintenance markets such as China, India, and Indonesia. When the Commercial Section conducts market surveys on behalf of specific U.S. exporters, he says, the conclusion is almost always that the Taiwan market would offer good opportunities if approached in the right way. As the Taiwan economy has developed, the focus of the Commercial Section has evolved accordingly. Among the areas currently receiving increased attention are travel and tourism, education, banking and finance, consulting, and higher-value technology industries.

Economic Section

“The Economic Section is mainly focused on policy analysis and advocacy with the Taiwan authorities,” says Hanscom Smith, the section chief. “We spend a lot of time working on particular policy issues that have an impact on U.S. economic interests.”

With regard to advocacy, Smith says the Economic Section assists American businesses, but not in the same way as the Commercial Section. Although the Economic Section will occasionally act on behalf of an individual U.S. company with a pressing problem, it usually concerns itself with issues that affect an entire industry or business sector – often as represented by an AmCham committee. “We tend to have a lot of contact with AmCham,” says Smith.

“As you'd expect with our ninth-largest trading partner, there are many relatively mundane or technical issues that come up in managing a trade relationship that big,” says Smith. “Some of our highest priorities include issues such as intellectual property rights protection, pharmaceutical market access, and other types of market access for U.S. exports.”

One of the current high priorities in the bilateral economic relationship is a platform – known as the Trade and Investment Framework Agreement (TIFA) – to encourage better market access and trade liberalization. TIFA talks take place annually, alternating between Washington and Taiwan, with a meeting tentatively slated to be held in Taipei this fall. “TIFA is the primary vehicle we have for trade and market access issues between the U.S. and Taiwan,” Smith says. “We are encouraging Taiwan to use the existing TIFA framework to enact trade liberalization measures and become more economically open.”

“We also keep an eye on what's happening in the Taiwan economy to get a perspective on how that might affect U.S. interests,” says Smith. The Section's job, he notes, involves following trends in the Taiwan economy, including cross-Strait developments, and reporting back to Washington. With the election of a new administration in Taiwan, the Section is following recent economic developments with increased attention. “We encourage cross-Strait economic ties,” Mr. Smith adds. Like the Commercial Section, the Economic Section has evolved with the Taiwan economy. “As Taiwan has risen in its level of development, the Economic Section has become much more involved with cooperation in the areas of environment, science, technology, and health,” says Smith. “There's a lot that we can share and learn from each other in those areas.”

Agriculture Section

“A primary task for this office is conducting market intelligence – knowing what's going on in the Taiwan market for food and agriculture,” explains Mark Dries, the Agriculture Section Chief. “However, we probably spend the greatest amount of our time working on market access issues, trying to remove impediments to entry of U.S. products or working with the authorities here to improve the existing access.”

In addition to the Agricultural Affairs Office, the section includes two other AIT units – the Animal and Plant Health Inspection Service (APHIS) Office, headed by Lou Vanechanos, and the Agricultural Trade Office (ATO), headed by Keith Schneller.

The work of the Agricultural Affairs Office is similar to that of the Economic Section, except that it focuses solely on agricultural matters. It plays an advocacy role on major policy and technical issues and keeps close tabs on Taiwan’s agricultural markets, producing reports for Washington and the public (many of them available online at www.fas.usda.gov).

“Agriculture” is defined in scope as including farm commodities such as corn, wheat, cotton, and soybeans; finished food products and beverages (including wine and distilled spirits); seafood products; and solid wood products such as lumber and plywood. “Anything that involves that trade – whether it’s an access issue, an opportunity to increase our knowledge of the market, or an opportunity to have a cooperative education program – is something that we might find ourselves working on,” Dries says.

The APHIS Office, on the other hand, focuses on a more narrow range of technical issues related to plant and animal health and quarantine. The ATO’s principal responsibility, similar to the Commercial Section but for agricultural products, is to engage in market development work. It maintains close contact with Taiwan’s private sector in the food and agricultural businesses, acts as a matchmaker between buyers and sellers, and seeks to create trade opportunities for U.S. products. Like the Commercial Section, the ATO currently operates from a separate location outside the main AIT complex.

The Taiwan market for U.S. food and agricultural exports is the sixth largest in the world and the second largest on a per capita basis, after Canada. “It's clear that Taiwan is a great customer and very interested in U.S. agricultural products – in a sense dependent on U.S. agriculture for many of its needs – and we've proven to be a good and reliable supplier, their number one supplier. Currently our market share of Taiwan’s total agricultural imports is about one-third,” Dries says. Despite rising competition from Canada, Europe, Australia, Japan, and various Asian suppliers, Dries believes that Taiwan will continue to be a strong market for U.S. agriculture. “We anticipate that Taiwan will continue to be one of our larger markets for some time to come,” he says.

While the Section focuses chiefly on U.S. exports, occasionally it gets involved with U.S. imports of Taiwan agricultural products. “Trade is a two-way street, so we're not totally divorced from that side of the equation,” Dries says. “Actually, Taiwan is itself a considerable agricultural exporter: the U.S. imports nearly US$500 million a year worth of Taiwan's food and agricultural goods, including seafood and wood products. Issues may arise where they seek better access to our market, and we get involved to some extent in those discussions.”

Dries notes that APHIS has involvement with Taiwan agricultural exports to the United States in its regulatory capacity. For example, APHIS worked with its counterpart authority at the Council of Agriculture to establish a new program governing the import of orchids into the United States, leading to a significant expansion in the quantity of Taiwan orchids sold in the U.S. market.

The Agriculture Section, particularly the Agricultural Trade Office, also plays a role in sponsoring promotional events. Recently, in addition to America Month, the ATO organized Southern cuisine and Western cuisine promotions, during which renowned U.S. chefs based in Louisiana and Idaho were brought to Taiwan to hold a series of cooking demonstrations. A number of U.S. state and agricultural associations, including the Southern United States Trade Association (SUSTA) and the Western United States Agricultural Trade Association (WUSATA), supported the promotions, and various agricultural marketing associations provided American food items for use in preparing American dishes.

“One thing very important to our work overseas is our partnership with U.S. agricultural industries and state government offices,” says Dries. “Over 40 of these organizations are working in Taiwan. One of the really important programs that we offer is the Market Access Program (MAP),” a matching program enabling nonprofit American agricultural organizations to use USDA funds to promote exports overseas.” The Agriculture Section undertakes the necessary coordination in Taiwan to bring these groups together and then works closely with other sections such as Public Affairs to ensure broad support and media coverage of U.S. industry efforts.

“We're actively working to promote the whole spectrum of products, and we consider Taiwan to be a very good and stable market where, for the most part, our access is well established,” says Dries. “But we do face a range of barriers that currently affect trade or our ability to expand the existing trade to new or different products. Rice is a good example of a product where we have such issues, and also beef and pork.”

While the Taiwan market is relatively mature, the Agriculture Section looks on Taiwan as a potential platform for reaching other markets in the region, including China. “We have a lot of contact with companies on Taiwan that have invested on the Mainland or in Southeast Asian markets such as Vietnam,” says Dries. “When we’re approached by U.S. food exporters, we can help foster relationships with those companies. It might be easier for them to come here first and make that connection rather than go directly into those markets.”

Consular Section

Perhaps the AIT section that members of the business community are most likely to interact with is the Consular Section, which deals with visas, passports, notary services, and the well-being of U.S. citizens.

The hallmark of the Section’s work is its one-on-one interaction with individuals, says Richard Adams, its Deputy Chief. “In other words, you have a baby, you need a passport, you get arrested. Then we have to provide a service to you as a person. This is the big difference between consular work and the other parts of the mission.”

Adams credits the smoothness of the visa procedures in Taiwan, which he contrasts with conditions in many other locations in the region, to the qualities of the local people, who are generally courteous, well-educated, well-organized, and law-abiding.

The American Citizens Services portion of the Section is responsible for assisting U.S. citizens in both routine as well as emergency circumstances. It issues U.S. passports, provides certification of births and deaths of Americans in Taiwan, and assists with documentation for Americans who want to marry in Taiwan. As elsewhere around the world, the principal function of consular officers at AIT is to protect U.S. citizens in difficulty and to promote the welfare of the overall American community. For American Citizens Services, that includes helping people cope with emergencies, providing information on paying U.S. taxes, and helping citizens register with their home state to vote in elections, in addition to renewing passports.

Can the Consular Section get Americans out of legal troubles in Taiwan? Not likely, says Adams. It will, however, contact an arrested U.S. citizen, offer information, and do its best to assure that he or she is treated correctly and humanely in accordance with local laws.

AIT also provides notary services, for a fee. And all U.S. federal government entitlements, including Social Security and veterans’ benefits, go through the American Citizens Services unit, though there is little the section can do for matters under state and county jurisdiction. “If you want to renew your driver's license, you can't do it here,” Adams notes.

This year, AIT projects that it will process about 180,000 visa applications, about the same as in the past few years. While demand for immigrant and nonimmigrant visas is flat overall, the United States remains the premier destination for Taiwan applicants to study abroad. The consular section also processes immigrant visas for almost 300 Taiwan orphans each year who have been adopted by American families.

Offering a tip to TOPICS readers, Adams noted the desirability of avoiding the peak season for visa applications. “If you need to get a visa, avoid the summer rush in May through July when we're the busiest,” he advised. In the summer, applicants may need to wait up to three weeks for an appointment.

The Consular Section extends cooperation to AmCham through the Express Visa program for Taiwan citizens working for the Chamber’s member companies.

Public Affairs Section

“The Public Affairs Section engages in outreach to the people in Taiwan so that they can gain a better understanding of American society, culture, foreign policy, and education,” explains Lawrence Walker, chief of the Press Unit within the Public Affairs Section. The Public Affairs Section sponsors programs and events to promote American ideas and culture and maintains contact and cooperation with civic organizations of many kinds. And Walker’s unit “tells America's story to the press.”

Most of the Section is located in the Cultural Affairs Center on the 21st floor of the Taipei World Trade Center’s International Trade Building. The Section’s Information Resource Center maintains the AIT website and provides access to contemporary information from the United States through electronic outreach and use of books, databases, and audio-visual materials. The Section sponsors an “American Corner” in Taichung (a partnership with the National Taichung Library), as well as "American Shelves" at libraries in the cities of Kaohsiung and Yilan, and in Taoyuan County. The American Corner offers opportunities for English classes, reading groups, and story hours for children, among other activities.

Another project is “American Classroom,” a series of Chinese-language presentations on American topics, often accompanied by a film. “We presented this to something like 1,900 students last year,” Walker notes. The Section also organizes a speakers’ program that brings experts from the United States to Taiwan, either in person or through digital video conferencing, as well as arranging for panelists from Taiwan to discuss U.S. cultural and social issues ranging from HIV/AIDS and human trafficking to American music and dance. AIT officers also frequently give lectures. “For example, I’ve given speeches on what the American character means for doing business with Americans,” Walker notes. Information on the Section’s events is posted online at http://www.ait.org.tw/en/accenter/.

AIT also provides free academic advisory services for students from Taiwan seeking to study in the United States through two partner organizations, the Foundation for Scholarly Exchange (FSE) and the American International Education Foundation (AIEF). With the FSE, it also sponsors the prestigious Fulbright academic exchange program in Taiwan, which includes academic exchanges in both directions as well as a number of recent U.S. university graduates teaching English in Taiwan schools, mostly in Yilan and Kaohsiung.

The Public Affairs Section also runs the International Visitor Leadership Program, a program under which up-and-coming people from a variety of professions can go to the United States for up to three weeks and see how their profession is practiced in the United States. Many people in Taiwan have benefited and learned from exchange programs over time, including President Ma Ying-jeou, who participated in the U.S.-sponsored Experiment in International Living in the early 1970s. This year Ma specifically requested that the U.S. government try to locate his co-participants, so that he could invite them all to his inauguration, says Walker.

The Perspective from the Director’s Office

Stephen M. Young has been Director of the Taipei Office of AIT since March 2006. Immediately prior to this assignment he was U.S. Ambassador to the Kyrgyz Republic, and during his foreign-service career he had two earlier postings in Taipei as well as Moscow (twice) and Beijing, in addition to service in Washington. Young holds a Ph.D. from the University of Chicago. He was interviewed by Taiwan Business TOPICS Editor-in-Chief Don Shapiro.

AIT has been in existence now for nearly 30 years. How has it evolved over that time?

Because I was a junior office here, arriving in April 1981, I do have a perspective on that. The first point is that despite what some people thought – that the break in diplomatic relations was going to lead to an attenuation of our engagement – that idea has been proven to be completely erroneous. We’re managing more consular work, more trade, more security cooperation, and more cultural engagement than ever. That’s a sign of the vitality of the relationship, which has survived and thrived despite the lack of formal diplomatic ties.

Also, AIT’s gotten bigger. We probably are double the size, in terms of the number of Americans working here, as reflected by the fact that our commercial unit, our cultural unit, as well as our Agricultural Trade Office and our language school can’t even fit in this building and are housed elsewhere. And the rest of AIT is rather tightly squeezed into this building, which was not constructed for our use. It was reasonably full in 1981 when I was here, and now it’s bursting at the seams.

We do plan to build a new facility in Neihu, and if all goes well we’ll be breaking ground next year and moving there in 2012. But for me and other managers of AIT, it’s going to be important to continue to make sure that this place on Xinyi Road is secure and functional and modern right up to the day we leave.

What has been AIT’s contribution to the maintenance of substantive relations with Taiwan despite the lack of diplomatic relations?

Whether it’s managing our security relationship or the informal diplomacy of Taiwan-U.S. relations in a critical triangle of Washington-Beijing-Taipei that continues to be both a potential hot spot and increasingly an area where people hope to see lowered tensions, we play a very important role. The relations with the Ma government are very good. At all levels of AIT we have good access to the Executive Yuan, the Legislative Yuan, the Presidential Office, etc. We’re engaged with them and in a very pragmatic and cordial manner.

Ma Ying-jeou said some good things in his inaugural speech about the importance of the U.S. relationship and he frequently reiterates those themes. I respect that, and I think that people in Washington do as well. If you take it that one of the key goals of our relationship is to avoid exacerbating the cross-Strait situation, there’s an awful lot of diplomacy that goes into that. That was the case in the Chen administration as well. While I think it’s pretty clear we had some difficulties at times, the channels of communication were always open. I think that AIT’s role is critically important, especially because senior U.S. officials can’t visit Taiwan. So if you compare what AIT does to what a diplomatic mission does in country Y or Z, there’s even more obligation for us to be interacting with our friends in Taiwan on issues of importance, whether they’re political or economic or security.

Can you tell us more about the plans for the new building and what will it mean for AIT?

One thing it means is that we’ll all be together in one place, including the language school which is currently up on Yangmingshan. It’s being built for everything we do now, plus room to grow. It’s viewed as an office complex that will serve our needs for the long term – several decades at least. That the Commercial Section and the Cultural Center and the Agricultural Trade Office, as well as the school, will be there means that we’ll all be in a secure compound. We’re working on the details of the design to ensure that it remains, within the necessary security requirements of the day, an accessible place for the segments of Taiwan society with which we deal.

Symbolically it will send a signal that is necessary and useful – that the United States remains committed, within the framework of our one-China policy and our informal relationship here, to a long-term engagement with Taiwan. When you build a 21st-century office building for AIT, it’s reassurance – should anyone be looking for that – that the United States is definitely committed to continuing to be Taiwan’s good friend.

When I was a young officer here, I remember a sense among some people that the break of relations in December of 1978 was sort of the beginning of the end, and that somehow our relationship would attenuate and Taiwan would work out its differences with China – or be forced to work out its differences with China – and that we were in a transitory stage. While we don’t object to any arrangement that is freely arrived at between the people of Taiwan and the people of China, until such time as that is worked out, we’ll continue to provide the informal link, whether it’s issuing visas and passports or promoting cultural exchanges or promoting a strong trade and investment relationship, and cooperating with Taiwan on its legitimate defense and security needs. And this new building will be designed to facilitate that.

How would you characterize the current state of US-Taiwan relations?

We have a very solid relationship. Trade continues to grow, and the number of students going to the United States continues to be quite remarkable. We have some 29,000 Taiwan students in the United States right now and we’ve probably educated hundreds of thousands of Taiwan’s best and brightest over the decades. We continue to take seriously our obligations under the Taiwan Relations Act to work with Taiwan on its defense, and Taiwan’s remarkable democratic transformation – which is a process in motion – continues to inspire the respect and admiration of Americans and people around the world. I continue to think that Taiwan is one of the most successful young democracies in the world, as evidenced by how quickly and steadily it’s come along since 1986, which was a watershed year with the decision by Chiang Ching-kuo to permit opposition parties to become legal.

The participation in this year’s elections was about 58% for the legislative elections in January and close to 78% for the presidential elections. That’s something Americans can only admire. It shows that people really are invested in this process and take it seriously.

There’s a lot for the people of Taiwan to be proud of and their friends in the United States share that sense of accomplishment. One very strong bridge that connects us is the Chinese-American community in the United States that has roots in Taiwan, and a lot of them are active here, whether in business or other areas. The incredible number of Taiwan government officials, academics, and businessmen who studied in the United States is both a cause and an effect of the good relationship that we have. Even at times under President Chen Shui-bian when there were some differences of opinion and some tensions over policies that he pursued, the fundamental good will between our peoples was never shaken.

So it’s a “going concern.” I have no doubt that whoever wins our presidential elections in November will continue to build on the strong unofficial relationship that I’ve described and will find that Taiwan is a good partner for the many values that we hold dear and that we bring to bear in our policy with this entire region. It’s all evidence of the inter-connectedness of the global economy, and it underscores that, whether it is maintaining confidence in international financial institutions, or dealing with transnational challenges such as health pandemics, environmental degradation, or other issues that recognize no borders, Taiwan continues to play an important role in our calculation of what’s important in Northeast Asia.