Science Park Management Fees in Taiwan Lowered

Digitimes reports the Taiwanese government is lowering the management fees of the science parks by 50%. According to Digitimes:

In order to help the local high-tech sector deal with an ongoing economic crisis, the Taiwan government has decided to lower management fees at the three science parks by up to 50%, according to market sources.

The sources indicated that science park management fee will be reduced for a year starting January 2009, with official details being announced soon by the National Science Council (NSC).

In the Southern Taiwan Science Park (STSP), each company used to pay NT$1.9 per every NT$1,000 in sales the company has each month. The new rates will be NT$0.95 per NT$1,000, the sources noted.

However, companies at the science parks had been requesting a reduction in both management fees and rent. The NSC, worried about the science parks' financial health, decided to first introduce a reduction in management fee, the sources added.

Taiwan's science parks have for a long time been the crucible of innovation in Taiwan. Many companies have opened up shop in these science parks and the government in this way has created areas with clusters of technology company. The government in Taiwan has also been at the forefront of driving the technology industry in one way or another so its good to see them getting involved and helping the companies out in this way.

Digitimes: Taiwan government to reduce science park management fees by up to 50%

Taiwan Science Parks to Generate NTD3 Trillion by 2011

Staggering figures from the National Science Council estimate more than 50% growth in production value from the three major science parks in Taiwan. They estimate the production value this year is around NT$1.222 trillion (about US$40 billion)and will be NT2.178 trillion (approximately USD70 billion) for the year. They expect this figure to grow to NTD3 trillion (USD100 billion) in 2011. That is large growth. The China Economic News writes:

With stable production growth, Taiwan`s big three science parks, namely Hsinchu Science Park (HSP), Central Taiwan Science Park (CTSP) and Southern Taiwan Science Park (STSP), are expected to generate aggregate production value of NT$3 trillion in 2011,the Cabinet-level National Science Council estimated.

Despite an economic depression in the world this year, the three science parks still posted a total of NT$1.222 trillion in overall production value in the first half of the year, up 17.16% from a year earlier. The combined annual production value is likely to hit an all-time high of NT$2.178 trillion for entire this year.

Separately, the IC (integrated circuit) industry in the three science parks contributed the largest portion of NT$485.5 billion, or 47.5%, to the total production value for the first half, up 6.46% from a year earlier. The optoelectronics industry infused NT$451.9 billion, or 44.22%, into the total, sharply up 37.12%, in the same span.

In the second half, a couple of semiconductor manufacturing companies, such as Taiwan Semiconductor Manufacturing Co. (TSMC), Vanguard International Semiconductor Corp., and Powerchip Semiconductor Corp., will boost their investments in HSP to NT$450 billion in HSP. Also, TSMC and United Microelectronics Corp. are planning to set up 12-inch wafer fabrication plants in STSP.

In the meantime, optoelectronics firms, including Innolux Display Corp., Chi Mei Optoelectronics Corp., Wintek Corp. and Toppan CFI Taiwan, will carry out capacity expansion at their display panel plants in the three parks.

According to National Science Council, in 2011, an estimated 800 companies with a total of 300,000 workers will operate in the three science parks, generating production value of up to NT$3 trillion that year.

Considering these parks were just a dream 35 years ago, their growth has been impressive.

China Economic News: Production Value of Taiwan`s Big 3 Science Parks to Hit NT$3 T. in 2011

Solar Cell Manufacturers Cluster in Yilan

The China Economic News (CENS) reports many of Taiwan's solar cell manufacturers and their upstream and downstream suppliers are clustering together in Letzer Industrial Park on the east side of Taiwan. One of the reasons for the popularity of the park is the opening of the new Taipei-Yilan highway which has significantly cut travelling time to and from the east coast.

CENS writes:

With Taiwanese companies of solar cells clustering in Letzer Industrial Park in Taiwan`s northeastern county of Yilan, a full, integrated supply chain of solar cells is gradually forming in the park.

At the moment, a number of Taiwanese upstream and downstream suppliers of solar cells have set up their plants in Letzer Industrial Park, occupying nearly 40 hectares of land there. Such a clustering effect makes the park Taiwan`s most important manufacturing base of solar cells.

Moreover, Sun Well Solar Corporation, a subsidiary of Taiwan`s CMC Magnetics Corp., has recently been approved by the park administration to set up a 21-hectare plant to turn out thin film solar cells in the park. Sun Well will achieve production capacity of 1 gigawatt in the plant in the near future, and hence plans to further apply for more hinterlands for capacity expansion.

After Taiwan`s presidential election this year, Lezter Industrial Park has become the hottest industrial park for solar cell suppliers on the island, partly because completion of No. 5 National Freeway, or called Taipei-Yilan Freeway, makes the transport between the two places more convenient, and partly because the park administration has planned to build a full supply chain of solar cells in the park.

Taiwan`s Industrial Development Bureau under MOEA has recently released additional land of about 20 hectares in Lezter Industrial Park for 26 enterprises to rent. However, this is not sufficient enough to satisfy them, as a total of 53 hectares of land is needed, based on their applications.

The development and growth of the Letzer industrial park is not unlike that of the Hsin Chu Science park where more than 20-years ago semiconductor companies started to cluster to facilitate easier cooperation between them. The cluster effect is a well known phenomenon and Silicon Valley in the US is a typical example (see Wikipedia page). Some have argued the cluster effect made the Hsinchu Science Park as successful. Companies operating in the Letzer industrial park may also benefit from the cluster effect. It is easier for different companies to talk to their suppliers and buyers and work cooperatively together to solve both upstream and downstream problems. It also reduces the neccessity for companies to integrate vertically since participants in higher or lower parts of the value chain are close at hand.

Interestingly the Souther Taiwan Science Park (STSP) in Tainan county has also benefitted from a clustering of optoelectronics companies and biotech companies.

One thing I am curious about though is where does the name Letzer come from? It is not a very Chinese name.

China Economic News: Full Supply Chain of Taiwan`s Solar Cell Sector Forms in Letzer Industrial Park