Taiwan's Competitiveness

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  • Topic: Global Competitiveness Report, Economics, Competitiveness
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Creating an Economic Strategy for Taiwan

Prof. Michael E. Porter Harvard Business School Global Leaders Forum Taipei, Taiwan April 8, 2010 This presentation draws on ideas from Professor Porter’s articles and books, including, The Competitive Advantage of Nations (The Free Press, 1990), “The Microeconomic Foundations of Economic Development,” in The Global Competitiveness Report, (World Economic Forum), “Clusters and the New Competitive Agenda for Companies and Governments” in On Competition (Harvard Business School Press, 1998) and ongoing research at the Institute for Strategy and Competitiveness. Additional information may be found at the website of the Institute for Strategy and Competitiveness, www.isc.hbs.edu No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means - electronic, mechanical, photocopying, recording, or otherwise - without the permission of Michael E. Porter. Taiwan Competitiveness 20100408

1

Copyright © 2010 Professor Michael E. Porter

Taiwan’s Current Malaise

• • •

Recent economic downturn Highest unemployment in decades Uncertainty of future relationship to China

Taiwan Competitiveness 20100408

2

Copyright © 2010 Professor Michael E. Porter

Taiwan’s Current Malaise

• • •

Recent economic downturn Highest unemployment in decades Uncertainty of future relationship to China

Slide from “The Competitive Advantage of Taiwan” Commonwealth Speech delivered on July 31, 2001

Taiwan Competitiveness 20100408

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Copyright © 2010 Professor Michael E. Porter

Prosperity Performance
PPP-adjusted GDP per Capita, 2000 ($USD)
$60,000

Selected Countries, 1990 to 2000
OECD average: 4.15%

$50,000

$40,000
Norway United States Switzerland Belgium Iceland Japan Austria Canada Sweden Finland Italy France Netherlands Denmark Australia Hong Kong United Kingdom Germany Spain Israel Portugal South Korea Singapore Ireland OECD average: $24,590

$30,000

$20,000

New Zealand Greece Czech Republic Hungary

Taiwan

$10,000

Mexico Turkey

Poland

Russia (-1.8%)

Chile

Malaysia

Brazil

Thailand Philippines (-0.3%) Indonesia Laos China (11.0%) India

$0 0% 1% 2% 3% 4% 5% 6% 7%

Vietnam

8%

9%

10%

Growth of Real GDP per Capita (PPP-adjusted), CAGR, 1990 to 2000 Taiwan Competitiveness 20100408authors ,

Source: EIU (2010)

calculations

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Copyright © 2010 Professor Michael E. Porter

Prosperity Performance
PPP-adjusted GDP per Capita, 2009 ($USD)
$60,000

Selected Countries, 2000 to 2009
OECD average: 3.26%

Norway

$50,000
United States Switzerland Ireland Australia Netherlands Singapore Austria Canada Sweden Denmark Belgium Iceland France Finland Japan United Kingdom Spain Germany Italy Israel New Zealand Portugal Hong Kong

$40,000

Taiwan
Greece South Korea Czech Republic

OECD average: $32,810

$30,000

$20,000
Mexico

Slovakia Hungary Malaysia Turkey Poland Chile Russia

$10,000

Brazil

Thailand Indonesia India Laos

China (12.44%) Vietnam Cambodia

$0 0% 1% 2% 3% 4%

Philippines

5%

6%

7%

8%

9%

10%

Growth of Real GDP per Capita (PPP-adjusted), CAGR, 2000 to 2009 Taiwan Competitiveness 20100408authors ,

Source: EIU (2010)

calculations

5

Copyright © 2010 Professor Michael E. Porter

Taiwan’s Prosperity Performance
Index of GDP per Capita (1950 = 100) 2,500

1950-2009
CAGR: +5.05% CAGR: +7.22% CAGR: +5.63% CAGR: +2.21%
Taiwan

2,000

China

1,500

Hong Kong

1,000

500
USA

100 0

1950

1955

1960

1965

1970

1975

1980

1985

1990

1995

2000

2005

2009

Taiwan Competitiveness 20100408

Note: PPP using Geary Khamis calculation methodology. Source: Groningen Growth and 6 Development Centre, Total Economy Database (Accessed March 2010)

Copyright © 2010 Professor Michael E. Porter

Unemployment Performance
Unemployment Rate, 2009...
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