Taiwanese Prime Minister Cho Jungtai has announced a sweeping economic and social reform plan, aiming to attract nearly $100 billion in investment. This comes after the former president Donald Trump said “Taiwan should pay us for defense.”
What happened: The reform plan would focus on energy, artificial intelligence and infrastructure. The strategy includes appealing to Taiwanese investors disillusioned with doing business in China, a trend the government wants to capitalize on, Prime Minister Cho said in a interview with Nikkei Asia.
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The plan is in line with the president Lai Ching-te‘s vision of a “smarter, forward-looking sustainability,” exploring the ocean and space industries and strengthening Taiwan’s global presence.
Despite the opposition majority in parliament, Cho is determined to press ahead with the reform, which aims to revive the Democratic Progressive Party after Lai’s re-election in January.
The plan includes the creation of an Economic Development Commission, chaired by Cho, to oversee a $100 billion investment in development.
Cho also stressed the need to address livelihood and housing concerns and attract Taiwanese investors who have turned away from China’s business environment. He stated: “China is no longer an attractive investment environment from a legal or political point of view. Many Taiwanese companies are coming back to Taiwan.”
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Another top priority for Cho is energy security. From 2023 to 2026, many existing power plants will be closed, making this a critical period.
The last reactor of Taiwan’s third nuclear power plant will be retired next year. However, Cho indicated that a proposal to expand the nuclear service should have been made five years ago. While the government is open to exploring future nuclear energy systems, he emphasized that “tomorrow’s technologies will not contribute to our energy demands today.”
The urgency has increased NVIDIA Corp (NASDAQ:NVDA), the world’s leading developer of AI chips, along with contract manufacturer and Apple Inc. (NASDAQ:AAPL) largest iPhone assembler Foxconn Technology Group and server maker Super Micro Computer Inc (NASDAQ:SMCI), announced plans to build new supercomputing, or AI, data centers in Taiwan. Additionally, Taiwan Semiconductor Mfg. Co. Ltd. (NYSE:TSM) and other chipmakers are expanding capacity.
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Why it matters: The announcement comes at a critical time for Taiwan navigating complex geopolitical situations and economic challenges.
Recently, the American President Joe Biden‘s withdrawal from the presidential race led to a dip in the shares of major Taiwanese companies such as TSMC. This underlines the volatility and sensitivity of the Taiwanese market to international political events. Former President Donald Trump‘s recent comments suggest Taiwan should pay for its defense have expressed concerns about the future of US aid.
Furthermore, the rapid growth of AI technologies is putting pressure on Taiwan’s infrastructure. Chief Telecom‘s chairman Jackie Liu has called for one complete redesign of data centers to meet the demands of AI computing, highlighting the urgent need for infrastructure upgrades.
President Lai Ching-te also publicly thanked him Micron Technology Inc.‘s (NASDAQ:MU) CEO for continued investments in Taiwanhighlighting the importance of foreign investment in maintaining Taiwan’s technological edge.
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This article Taiwan unveils $100 billion economic reform plan after Trump said it ‘should pay us for defense’: It will fuel Nvidia, TSMC and Apple iPhone Assembler’s AI plans originally appeared on Benzinga.com
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