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Climbing the value chain: A lesson from Taiwan
Luddites beware: Engineers at Tongtai Groupâs factory in Kaohsiung, Taiwan, make machines for producing spare parts for the automotive, aviation, aerospace and manufacturing industries on Aug
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Luddites beware: Engineers at Tongtai Groupâs factory in Kaohsiung, Taiwan, make machines for producing spare parts for the automotive, aviation, aerospace and manufacturing industries on Aug. 7. The machines are mostly exported to China and Southeast Asia. Tongtai is one among many Taiwanese companies providing manufacturing solutions to major companies such as Toyota and Honda.(JP/Rendi A. Witular)" border="0" height="297" width="512">Luddites beware: Engineers at Tongtai Groupâs factory in Kaohsiung, Taiwan, make machines for producing spare parts for the automotive, aviation, aerospace and manufacturing industries on Aug. 7. The machines are mostly exported to China and Southeast Asia. Tongtai is one among many Taiwanese companies providing manufacturing solutions to major companies such as Toyota and Honda.(JP/Rendi A. Witular)From an umbrella that can purify rain into drinking water to a cardboard-thin aluminum-ion battery that can fully recharge a mobile phone within seconds, the innovation hall at Taiwanâs Industrial Technology Resource Institute (ITRI) headquarters has never ceased to inspire innovators worldwide.
Located in Hsinchu, around 68 kilometers from the capital Taipei, ITRI is one of the many centers of innovation that epitomize Taiwanâs rise to high-tech powerhouse.
The nonprofit R&D organization was founded in 1973 to engage in applied research and technical services dedicated to helping local industries stay competitive.
Following its role in transforming Taiwanâs economy from a labor-intensive industry to high-tech industry in the late 1970s, government institutions and businesses have relied on the agency to come up with new innovations in medical equipment, biotechnology, mobile gears, and environmental technology, to name a few.
âBy nurturing startups and working alongside international academics and institutional partners, ITRI is able to bring its R&D results to life with industrial applications and commercialization,â ITRI spokeswoman Jenny Chao said recently.
The agency has an annual operating budget of around US$650 million, employing more than 5,500 personnel, including more than 1,300 researchers with PhD degrees.
Taiwanâs achievements in science, as evident in the activities of ITRI and a number of science parks serving as incubators of innovation, have lived up to the ambitions of Sun Yun-suan, an engineer and politician credited for overseeing the transformation of Taiwan, and its rise up the value chain.
As minister of economic affairs from 1969 to 1978 and Taiwanâs premier from 1978 to 1984, Sun has instilled the nation with innovations through his inspiring proverb âboost the nation with science, leave the regrets to mother nature.â
Indonesiaâs BJ Habibie, who served as research and technology minister between 1978 and 1998, and as President between 1998 and 1999, may well have shared similar dreams when he shifted Indonesiaâs dominantly agricultural-oriented skills to high-tech aviation engineering in the early 1980s.
Habibieâs efforts, however, have been widely seen as getting off on the wrong foot, as he pursued research and innovation that did not meet Indonesiaâs desperate need for productive technology in agriculture and basic industries.
Habibieâs dream failed to take off, and Indonesia remains a country producing largely basic industrial goods, such as footwear and textiles, while its less-developed ASEAN peer Vietnam is already producing sophisticated mobile devices.
After Habibieâs era, research and technology has been consistently on the back burner, unlike in Taiwan where it has been consistently nurtured by an unabated flow of taxpayer funds.
This is evident in the last ten years of budget allocations in which the Religious Affairs Ministry has consistently received more funds than agencies dealing with research and technology, according to the Finance Ministry data.
In next yearâs draft state budget, the Religious Affairs Ministry will be the fifth biggest recipient of taxpayer money with Rp 58.4 trillion (US$4.23 billion), while the Research and Higher Education Ministry will rank the ninth with a budget of Rp 38 trillion.
In comparison, Taiwan will spend more than $15 billion this year on the development of science and technology.
span class="inline inline-center">Luddites beware: Engineers at Tongtai Group's factory in Kaohsiung, Taiwan, make machines for producing spare parts for the automotive, aviation, aerospace and manufacturing industries on Aug. 7. The machines are mostly exported to China and Southeast Asia. Tongtai is one among many Taiwanese companies providing manufacturing solutions to major companies such as Toyota and Honda.(JP/Rendi A. Witular) From an umbrella that can purify rain into drinking water to a cardboard-thin aluminum-ion battery that can fully recharge a mobile phone within seconds, the innovation hall at Taiwan's Industrial Technology Resource Institute (ITRI) headquarters has never ceased to inspire innovators worldwide. Aside from receiving budget priority; commitment, focus and an ambition to keep ahead of the pack have always been the key to Taiwan's innovation success, according Chien Chou, the director general of international cooperation and science education at Taiwan's Science and Technology Ministry. 
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Located in Hsinchu, around 68 kilometers from the capital Taipei, ITRI is one of the many centers of innovation that epitomize Taiwan's rise to high-tech powerhouse.
The nonprofit R&D organization was founded in 1973 to engage in applied research and technical services dedicated to helping local industries stay competitive.
Following its role in transforming Taiwan's economy from a labor-intensive industry to high-tech industry in the late 1970s, government institutions and businesses have relied on the agency to come up with new innovations in medical equipment, biotechnology, mobile gears, and environmental technology, to name a few.
'By nurturing startups and working alongside international academics and institutional partners, ITRI is able to bring its R&D results to life with industrial applications and commercialization,' ITRI spokeswoman Jenny Chao said recently.
The agency has an annual operating budget of around US$650 million, employing more than 5,500 personnel, including more than 1,300 researchers with PhD degrees.
Taiwan's achievements in science, as evident in the activities of ITRI and a number of science parks serving as incubators of innovation, have lived up to the ambitions of Sun Yun-suan, an engineer and politician credited for overseeing the transformation of Taiwan, and its rise up the value chain.
As minister of economic affairs from 1969 to 1978 and Taiwan's premier from 1978 to 1984, Sun has instilled the nation with innovations through his inspiring proverb 'boost the nation with science, leave the regrets to mother nature.'
Indonesia's BJ Habibie, who served as research and technology minister between 1978 and 1998, and as President between 1998 and 1999, may well have shared similar dreams when he shifted Indonesia's dominantly agricultural-oriented skills to high-tech aviation engineering in the early 1980s.
Habibie's efforts, however, have been widely seen as getting off on the wrong foot, as he pursued research and innovation that did not meet Indonesia's desperate need for productive technology in agriculture and basic industries.
Habibie's dream failed to take off, and Indonesia remains a country producing largely basic industrial goods, such as footwear and textiles, while its less-developed ASEAN peer Vietnam is already producing sophisticated mobile devices.
After Habibie's era, research and technology has been consistently on the back burner, unlike in Taiwan where it has been consistently nurtured by an unabated flow of taxpayer funds.
This is evident in the last ten years of budget allocations in which the Religious Affairs Ministry has consistently received more funds than agencies dealing with research and technology, according to the Finance Ministry data.
In next year's draft state budget, the Religious Affairs Ministry will be the fifth biggest recipient of taxpayer money with Rp 58.4 trillion (US$4.23 billion), while the Research and Higher Education Ministry will rank the ninth with a budget of Rp 38 trillion.
In comparison, Taiwan will spend more than $15 billion this year on the development of science and technology.
'There should be a strong commitment in nurturing the culture of innovation,' Chien said.
Taiwan has been focusing on that since 1959 when it established the National Science Council (NSC), which in 2014 became the Science and Technology Ministry.
The NSC set up Hsinchu Science Park in 1980, Taiwan's first science park, which is now the world's leader in semiconductor manufacturing and where the first production of Apple's iPhone was rolled out.
Hosting more than 400 global tech companies, Hsinchu produces 70 percent of the world's integrated circuit (IC), or microchips, and is now the world's biggest IC designer.
'The park not only fosters scientific and technological development, but also offers total solutions; design, manufacturing, and problem solving. That's how the park works,' said Chien.
According to Chien, the park had its share of problems in its first ten years when it struggled with finding its focus.
The concept of science parks first emerged in the 1950s, with Silicon Valley in United States being a typical example.
To emulate the success of Silicon Valley, the Hsinchu Science Park brings together higher education institutions, research organizations and businesses that are focused on inventing products with industrial applications, according to Chien.
At present, Taiwan is home to three science parks that are located in the northern, central and southern parts of the island, carrying out different aspects of research.
Aside from cooperating closely with the business community, the science parks are also taking guidance from the government on specific sectors to be developed in the next three to five years.
'There is of course mission-oriented research assigned by the government to keep Taiwan not only ahead of the global competition but also to provide solutions to our own problems,' said Chien.
'Among our guided research is 5G telecommunication technology, industrial technology, biopharmaceutical, and water conservation. There is also priority research to find solutions to our aging society and low birth rate,' she said.
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