GDP (Million $) – 802.958 (IMF 2024)
GDP Per Capita ($) – 34.432
Growth Rate (%) – 3,07
Population – 23.320.000
Total Area (km2) – 36.188
Capital – Taipei
Taiwan is the 16th-largest merchandise exporter in the world and 17th-largest merchandise importer in the world. Together, Taiwan’s total trade volume reached almost $828 billion in 2021 with a $65.3 billion trade surplus.
Taiwan’s trade volume is mostly in the machinery and electronics sector. In 2022, more than 60 percent of Taiwan’s exports by value were in this sector. Integrated circuits, including semiconductors and peripheral circuits, make up the largest share of Taiwan’s machinery and electronics exports, at just over 60 percent of exports within the machinery and electronics sector and approximately 40 percent of all exports by value. Products in the machinery and electronics sector also make up approximately 40 percent of Taiwan’s overall imports.
FOREIGN TRADE
Taiwan, whose natural resources are relatively limited, specializes in the strategy of exporting manufactured goods by importing raw materials and intermediate goods. Therefore, both imports and exports have reached large figures. In 2023, exports amounted to $432.96 billion and imports amounted to $358.68 billion. Until a few years ago, the USA and Japan were the most important countries in Taiwan's foreign trade, but in recent years, mainland China has started to surpass these two countries. Developments in the economies of these three countries directly affect Taiwan's foreign trade.
Mainland China is Taiwan's largest export market. In 2023, exports to mainland China amounted to approximately $95.9 billion. Mainland China plays an important role in Taiwan's exports, especially in electronic products. Taiwanese exporters sell their products here to the USA, EU countries and Japan through reexport to take advantage of the cheap costs in mainland China. In addition to mainland China, Taiwan's significant amount of exports are in the USA and Asia, especially Hong Kong; It headed to Japan, Singapore and South Korea. On the other hand, China, Japan, the United States and South Korea are Taiwan's increasingly important trading partners in imports and mutual trade. In addition, some EU countries, especially Germany, are among Taiwan's important trading partners.
MACHINERY INDUSTRY
Taiwan plays an important role in the global machine industry. Its smart manufacturing integration capability is robust with high cost/performance value. Taiwan's machinery ranks 5th in terms of output value for the machine tool sector, 6th for plastic manufacturing machinery, and 4th for woodworking machines. The following are some of its advantages: Able to meet customer needs through short delivery times and great flexibility; High-mix, low-volume customization capabilities and the ability to create entire factory production lines; The world's highest density precision machinery cluster. Taichung (middle of Taiwan) is home to over 1,000 machine makers and more than 10,000 suppliers. It's the world's most productive machine industry per square meter of area.
Taiwan has developed a complete machinery and machine tools ecosystem comprising close linkages between midstream and downstream segments and highly interdependent clusters. In 2022, Taiwan’s machinery and machine tools industry generated $48 billion in local production and accounted for $34 billion in total exports, demonstrating the industry’s export-oriented posture. The United States was the second-largest source of machinery and machine tools, preceded only by Japan. Imports from the United States totaled $12.3 billion, accounting for 20 percent of total machinery and machine tools imports.
The Taichung Metropolitan Area is the center of Taiwan’s advanced manufacturing industry. Taichung is home to the Smart Machinery Promotion Office, and the Taichung City Precision Machinery Innovation Technology Park has the highest concentration of machine tool manufacturing in the world.
In 2017, the Taiwan authorities enacted the “5+2 Industrial Development Initiatives,” which are industrial innovation programs that target smart machinery, “Asia-Silicon Valley” which relates to Internet of Things innovation, green energy technology, the biomedical industry, the defense industry, new agriculture, and the circular economy. Of these innovation initiatives, Smart Machinery is the fastest growing program with the most tangible results. It aims to enhance Taiwan’s international competitiveness in the smart machinery industry and establish Taiwan as a hub of smart machinery innovation in Asia.
METAL INDUSTRY
Metal products exports compose nearly 8 percent of Taiwan’s exports by value. Taiwan’s metal exports are led by metals fasteners, such as screws, nuts, and bolts, followed by hot-rolled flat products of iron and steel. As of 2022, the largest export destinations for goods in the metal sector were the United States (26.7 percent of metal exports by value in 2022), China (13.4 percent), Japan (7.9 percent), Vietnam (4.2 percent), and Thailand (3.5 percent). Taiwan is home to more than 1,800 fastener manufacturers, responsible for 13 percent of global fastener production. Taiwan is also the third-largest fastener exporter in the world and largest exporter of fasteners to North America. Most of Taiwan’s fastener exports are destined for the United States and Europe. Taiwan continues to innovate in the fasteners market and is moving into higher-value fasteners, such as those used by the aerospace industry.
As of 2022, Taiwan is the twelfth-largest steel producer. Its top export destinations for steel were Vietnam (12 percent of Taiwan’s steel exports), China (11 percent), Japan (8 percent), and the U.S (8 percent). During this period, the majority of Taiwan’s steel exports by value were flat products (i.e. sheets, strips, and plates) and stainless steel products. To remain competitive with lower-priced steel exports from China, Taiwan has focused on technical upgrades, capital investments, more technical products, and R&D.
FASTENER INDUSTRY
Taiwan is a leading global producer of fasteners, often ranked among the top three exporters worldwide. The industry contributes significantly to the country's manufacturing sector and export economy. Over 90% of Taiwan's fastener production is exported, with key markets including the United States, Europe, and Japan. The U.S. is the largest importer of Taiwanese fasteners.
Taiwan is renowned for producing high-quality and precision-engineered fasteners, which are crucial in industries like automotive, aerospace, electronics, and construction. The industry has invested heavily in automation, advanced machinery, and quality control systems, enabling efficient production processes and high product standards. Taiwanese manufacturers are continuously innovating in materials, coatings, and product designs to meet the evolving needs of global markets. For example, there has been a focus on producing fasteners with enhanced corrosion resistance and strength.
While maintaining high standards of quality, Taiwanese fastener manufacturers offer competitive pricing. This balance of quality and affordability makes Taiwan a cost-effective choice for global buyers. The industry's efficiency in production processes helps keep costs low, which can be passed on to customers in the form of better pricing.
Taiwan has a well-developed logistics and supply chain network, enabling reliable and timely delivery of products worldwide. The country's strategic location in Asia also facilitates quick shipping to major markets. With a significant concentration of fastener manufacturers, particularly in regions like Kaohsiung, Taiwan can handle large orders and ensure a steady supply of products.
Taiwan has produced screw products for 40 years. In the southern region, the Chunyu factory was the first to set up factories, and the northern region was the global screw factory. These two factories are not only pioneers in the screw industry in the country, but also created a large number of talents in the screw industry. Many business leaders in Taiwan's screw industry have a relationship with the two factories.
Due to the rapid development of the domestic screw industry, eight manufacturers initiated the formation of the "Taiwan Industrial Fasteners Institute" in 1969. At that time, there were only 32 member factories, and the number of factories increased year by year. There are currently about 700 members. (Taiwan Industrial Fasteners Institute (TIFI))
