Taiwan is already well on track to becoming a knowledge-based economy and the government is playing an active role in developing the fields of science and technology (S&T), which necessarily form the foundations of such an economy. For instance, Taiwan invested about US$2.19 billion in S&T endeavors in 2004 alone. Roughly speaking, for every NT$1 billion (about US$30 million) spent on S&T research, 1,210 academic papers, 27 patents, 131 technical reports, 29 technological innovations, 39 copyrights, 0.48 technology acquisitions, 23 technology transfers, and 354 cases of technical service are generated.

With 12,939 papers and 10,980 articles cited in 2004 in Science Citation Index (SCI) and Engineering Index (EI), respectively, Taiwan's accomplishments are well-documented. In the same year, a total of 5,938 US patents had been awarded to local recipients, putting Taiwan behind only the US, Japan, and Germany in terms of US patents granted.

Taiwan's efforts to cultivate an e-generation put it at the top of the e-government performance list of 198 countries surveyed by the US's Brown University in 2005, and at number 7 in terms of "Networked Readiness Index" in the Global Information Technology Report 2005-2006. Taiwan also ranked seventh in the world for digital access in a survey conducted by the International Telecommunication Union in 2005.

Meanwhile, Taiwan has been working hard to reach its goal of raising its S&T level to that of developed nations by 2010. R&D input and output targets include raising R&D funding to 3 percent of GDP and increasing the number of research personnel holding bachelor's or advanced degrees to 32 persons per 10,000 population by 2007. Local inventors and companies are encouraged to apply for US patents so that Taiwan can meet its target of 3.5 percent of all US patents granted (not including new design patents) by 2007. As well, the government is promoting the use of broadband in hopes of reaching its target of six million users by 2007.

Policies

The National Science Council (NSC) 行政院國家科學委員會 is the highest-level government agency responsible for promoting the development of S&T. The NSC draws up development policies and programs, plans and implements basic and applied research, improves the research environment, and recruits and trains related personnel. Following the enactment of the Fundamental Science and Technology Act 科學技術基本法 in 1999 and the Seventh National Science and Technology Conference in 2005, the NSC issued the White Paper on Science and Technology (2003-2006) 科學技術白皮書 and formulated the National Science and Technology Development Plan (2005-2008) 國家科學技術發展計劃.

The S&T development plan contains six major strategies and 185 measures, with most of the objectives set to be reached by 2008. The six strategies are as follows: streamlining S&T policies, ensuring that resources and policies complement one another, and using resources efficiently; strengthening personnel planning and utilization while augmenting the number of S&T personnel; boosting academic research standards while developing distinctive academic fields; encouraging innovation while overcoming industrial development barriers; fostering the development of everyday S&T applications while stimulating interaction with society; as well as enhancing the defense technology system while promoting defensive arms development.

The NSC sponsors a number of national S&T programs to address social, economic, and environmental problems in Taiwan. (See table below for details.) Under the Challenge 2008 National Development Plan 挑戰二○○八：國家發展重點計畫, a total of 90 projects were implemented in 2005 to transform Taiwan into an international innovation and R&D base, increase value-added production, and digitize Taiwan. The projects include the recruitment of qualified personnel from overseas, the allocation of US$1.5 billion for R&D loans, the establishment of a college for semiconductor technology and one for digital content, and the promotion of key industrial technology research. As of June 2005, 87 R&D centers had been established in Taiwan by domestic enterprises in the areas of information communication, optoelectronics, machinery, materials, and chemical engineering. Twenty-seven multinational enterprises have either established or planned to establish a total of thirty research centers in Taiwan. These include Hewlett-Packard, Dell, IBM, Microsoft, Intel, Sony, and Becker Avionics.

In addition, the government announced in March 2006 that it planned to invest more than US$958 million over the next five years to develop six strategic technology industries related to daily life: soft electronics, nanotechnology, radio frequency identification (RFID) technology, smart robots, smart vehicles, as well as living spaces. It is estimated that the annual production value of smart robots and RFID technology will reach US$2.69 billion and US$2.09 billion, respectively, by 2013.

National Science and Technology Programs
Program	Budget (US$ million)	Time frame
Hazards mitigation	31.07	1999-2001
	88.51	2002-2006
Telecommunications	384.13	1998-2003
	399.47	2004-2008
Agricultural biotechnology	23.97	1998-2001
	59.59	2002-2004
Biotechnology and pharmaceuticals	121.13	2005-2008
	50.53	2000-2002
Genomic medicine	226.98	2003-2006
	217.50	2002-2005
Digital archives	287.38	2006-2010
System-on-chip	86.24	2002-2006
	229.38	2002-2005
Nanoscience and nanotechnology	432.91	2006-2010
E-learning	667.48	2003-2008
	117.32	2003-2007
Source: National Science Council

Technology Development Plan

In 2004, the MOEA allocated US$542 million to nonprofit research institutes, the private sector, and universities for industrial technology R&D through the Technology Development Program (TDP) 科技研究發展專案計畫. Launched in 1979, the program was initially run through nonprofit research institutes to enhance innovative and forward-looking research, build vital infrastructure, and develop key technologies. The TDP was first expanded in 1997 to promote the private sector's participation in industrial technology development, information technology application, and innovative research. In 2001, the TDP was opened further to allow for the participation of academics.

The TDP provides grants for innovative research in the electronics, information, consumer chemical, mechanics, biotech, and pharmaceutical industries. It also encourages R&D alliances formed for the development of traditional and high-tech industrial technologies, R&D done jointly by manufacturing and education sectors, and R&D centers established by multinational enterprises in Taiwan.

In 2004, the TDP helped nonprofit research institutes obtain 1,213 patents, produce 2,527 research papers, and engage in 1,184 technology transfer programs. As for the industrial sector's R&D under the TDP, US$21.8 million from technology transfers and US$5.33 million from franchising were yielded. From 1999 to 2004, the private sector garnered 834 patents and 438 research papers, and academic circles produced another 1,540 papers.

Science and Technology Advisory Group of the Executive Yuan

行政院科技顧問組

To promote comprehensive development of S&T, the Executive Yuan promulgated the Science and Technology Development Program 科學技術發展方案 in May 1979 as guidelines for its ministries, councils, and agencies. This program also established an advisory board concerned with science and technology. A number of world leaders from various fields of science and technology have been invited to become members of the advisory board, which advises the premier and relevant members of the Cabinet on the government's S&T development options. To ensure the effective operation of the advisory board, a mission-oriented Science and Technology Advisory Group (STAG) was established in December 1979. The Executive Yuan revised the Operational Guidelines of the STAG in April 1998, and the premier now invites a number of eminent local and overseas S&T advisors to serve on the advisory board. Local advisors attend all of the S&T meetings held by the Executive Yuan and together form a consultative group for the Cabinet. The primary missions of the STAG include: providing recommendations on national development policy and important S&T programs or projects for development, sponsoring and organizing board meetings as well as various strategic review board meetings, steering S&T development programs or projects designated by the Cabinet, collecting important S&T development information, and other matters relevant to S&T as decided by the premier. The STAG does not directly implement projects, but rather coordinates their implementation by various government agencies, industries, research institutes, and academia.

Research Environment

While science parks facilitate the spread of industrial technology throughout Taiwan, research facilities of specialized fields have been established to nurture highly skilled R&D personnel. These efforts aim at bringing Taiwan into the ranks of the most technologically advanced nations in the world.

Science Parks

Hsinchu Science Park

The first in a series of high-tech industrial parks, the Hsinchu Science Park (HSP) 新竹科學工業園區 was established in northwestern Taiwan to create an environment conducive to high-tech R&D, production, work, and life to attract professionals and technology. The park's prime location and the rapid growth of its companies and products have made it the "Silicon Valley of Taiwan" and a base for cultivating high-tech industries.

Since 1980, the government has invested over US$1.7 billion in the park. As of the end of 2005, 400 high-tech companies in six industries (integrated circuits, computers and peripherals, telecommunications, optoelectronics, precision machinery, and biotechnology) were located in the 625-hectare park. The Hsinchu Science Park registered a turnover of around US$29.6 billion in 2005. With 111,580 employees, the average productivity of a park employee was valued at US$265,000. The park administration has been vigorously recruiting overseas entrepreneurs as well, and around one-third of park enterprises were founded by people from abroad. At the end of 2005, the total accumulated paid-in capital exceeded US$35 billion and 97 park companies were listed on Taiwan's main exchange, TAIEX, and on OTC markets.

The third phase in expanding the HSP's basic infrastructure has been completed. Despite this enlargement, after years of rapid growth, the HSP has become full. To meet the continually growing demand for space, Jhunan 竹南鎮 and Tongluo 銅鑼鄉 townships of Miaoli County 苗栗縣, about 15 and 40 minutes' drive from the HSP, respectively, were chosen as the sites for the fourth phase of expansion. The 138-hectare Jhunan site now houses 34 firms in the optoelectronics and biotechnology industries. The 350-hectare Tongluo site is designed to host industries concerned with the manufacture of technologies for both military and civilian use.

To implement the Challenge 2008 National Development Plan and aid key value-added industries, three new parks are being planned: the 200-hectare Longtan Park 龍潭園區 in Taoyuan County 桃園縣; the 38-hectare Hsinchu Biomedical Science Park 新竹生物醫學園區 in Jhubei City 竹北市, businesses housed at which will concentrate on medical sciences and cancer research; and Yilan Park 宜蘭園區 in Yilan County 宜蘭縣, the focus of which will be on communications and knowledge-based service industries.

Southern Taiwan Science Park

A laboratory researcher uses nuclear magnetic resonance spectroscopy to determine the chemical structure of certain substances.

The second science park, the Southern Taiwan Science Park (STSP) 南部科學工業園區, includes the Tainan Science Park 臺南園區, the Kaohsiung Science Park 高雄園區, and the Kaohsiung Biotechnology Park 高雄生物科技園區, which were approved to be established in 1995, 2001, and 2005, respectively. Covering 1,616.5 hectares, the STSP represents part of the government's effort to develop Taiwan into a "green silicon island." The STSP's turnover in 2005 totaled US$10.56 billion. As of the end of 2005, 178 firms had been approved to move into the park. In 2005, the total workforce numbered 41,270 persons.

Optoelectronics, IC, and biotechnology industry clusters have taken root in the STSP. In particular, with upstream and downstream optoelectronics enterprises having been admitted into the park, the STSP has the most complete vertical integration of the optoelectronics industry and will continue to prosper when working with the nearby LCD-TV Special Zone 液晶電視特區. Furthermore, with the establishment of the 12-inch foundries of Taiwan Semiconductor Manufacturing Co. Ltd. (TSMC) 台灣積體電路製造股份有限公司 and United Microelectronics Corp. (UMC) 聯華電子股份有限公司, the STSP now owns the latest copper interconnect technology.

As well, under the collaborative direction of the Biotech Core Area 生技專區 and Biotech Corridor 生技走廊 of the Tainan Science Park, the Medical Device Special Zone 生技醫療器材產業專區 of the Kaohsiung Science Park, and the Kaohsiung Biotechnology Park, the local biotechnology industry is expected to work with R&D institutions in the STSP to form a niche-based R&D powerhouse and reach maximum economic efficiency based on the integration of R&D, test runs, and production.

Additionally, following the entry of the Telecommunications Technology Center 電信技術中心 in May 2004 into the Kaohsiung Science Park, the STSP is trying to attract relevant enterprises to the park. It also hopes to build a telecommunications zone such that the telecommunications industry can become the third trillion-dollar industry in Taiwan.

The STSP is a research-oriented, innovative park. The Industrial Technology Research Institute 工業技術研究院 and several other research institutes have branches in the park, while universities have R&D centers there. Research results can thus be easily and directly applied to industries and fruitful collaboration between industry and academia can be stimulated. It is hoped that this will attract further investment.

Other Science Parks

After the HSP and the STSP, a third park in Taichung 臺中 and Yunlin 雲林 was created. This park, the Central Taiwan Science Park 中部科學工業園區, covers 510 hectares, with the main 414-hectare site adjacent to Taichung City and Taichung County, and a 96-hectare satellite site in Yunlin County. The new science park will focus on the development of optoelectronics, integrated circuits, precision machinery, and biotechnology at the Taichung location, while emphasizing agricultural biotechnology and optoelectronics at the Yunlin location. As of December 2005, 77 firms had received approval to move into the Central Taiwan Science Park, creating 50,000 jobs and attracting about US$39.5 billion in investments.

In an effort to promote environmentally friendly industries, environmental technology parks are planned in Taoyuan, Tainan, Kaohsiung, and Hualien. Incentives are in place to attract investment in green technology to enhance energy, resource, and land-use efficiency.

Organizations Supported by the NSC

National Applied Research Laboratories

The National Applied Research Laboratories (NARL) 財團法人國家實驗研究院, a nonprofit organization established by the NSC in June 2003, comprises eight research laboratories: the National Nano Device Laboratory 國家奈米元件實驗室, National Laboratory Animal Center 國家實驗動物中心, National Space Organization (NSPO) 國家太空中心, National Center for Research on Earthquake Engineering (NCREE) 國家地震工程研究中心, National Center for High-performance Computing (NCHC) 國家高速網路與計算中心, National Chip Implementation Center 國家晶片系統設計中心, Science and Technology Policy Research and Information Center 科技政策研究與資訊中心, and Instrument Technology Research Center 儀器科技研究中心. These centers are located in Taipei, the Hsinchu Science Park, or the Southern Taiwan Science Park.

To support academic research and technological development, the NARL promotes the integration of existing laboratory resources. It focuses primarily on cutting-edge research in the pure and applied sciences. In addition, the NARL establishes R&D platforms to serve the industry, as it strives to keep pace with technological trends via exchanges and cooperation with renowned research institutes around the world.

The NARL engages in satellite monitoring, precision instrument manufacturing, remote data-processing,grid calculation, earthquake engineering, and disaster prevention technology development in cooperation with the National Science and Technology Center for Disaster Reduction 國家災害防救科技中心. It also promotes the creation of forward-looking technologies by integrating nanotechnology, system-on-chip (SoC), aerospace technologies, and grid calculation.

Over the past few years, the NARL has accomplished many of its goals, such as the launching of FORMOSAT-2 and FORMOSAT-3 (see section below on space technology) by the NSPO; the application of the Asthma Grid, which was developed by the NCHC to help control severe acute respiratory syndrome; an underwater system devised by the NCHC to monitor marine ecology; and an earthquake-damage assessment system developed by the NCREE.

National Synchrotron Radiation Research Center

The National Synchrotron Radiation Research Center (NSRRC) 國家同步輻射研究中心 is one of Taiwan's largest scientific research facilities. Its mission is to operate a cutting-edge synchrotron radiation facility for pioneering scientific research. Its beamlines are available to researchers in diverse basic and applied fields. The NSRRC is a world-class facility due to its state-of-the-art research instruments and capabilities in the vacuum-ultraviolet and soft X-ray energy fields.

Organizations Supported by the Ministry of Economic Affairs

Industrial Technology Research Institute

Founded in 1973 by the Ministry of Economic Affairs (MOEA) 經濟部 and headquartered in the Hsinchu Science Park, the Industrial Technology Research Institute (ITRI) 工業技術研究院 is Taiwan's largest nonprofit research organization, having a total workforce of 5,442 at the end of 2005. Its mission is to help businesses develop products and manufacturing techniques. It receives about half of its funding from the government and half from industry. The ITRI's research projects include communications and optoelectronics (microelectronics, display, and SoC), precision machinery and micro-electromechanical systems (metrology and systems engineering), sustainable development (including energy, environment and industrial safety), and nanotechnology (nanomaterials, nanoelectronics, and nanobiotech). It is also involved in telecommunications, biotechnology, genomic medicine, and e-learning national research programs.

The ITRI makes significant contributions to applied technological research for the manufacturing sector. For example, during the mid-1970s, the ITRI obtained access to Complementary Metal-oxide Semiconductor (CMOS) technology from the US and, over the following decade, guided Taiwan's fledgling IC industry by providing both technology and personnel. Today, the top two IC foundries in the world, TSMC and UMC, command 60 percent of the world's dedicated chip foundry market.

The ITRI's Open Laboratory plan, instituted in 1996 for joint research and incubator programs, had accumulated over US$2 billion in R&D investment and had supported the creation of 133 startup companies as of the end of 2005. The effort to pursue international cooperation has resulted in close ties with many world-class institutions.

The ITRI works with partners on technological advances and new products. In 2005, it transferred technology for 663 items to 851 companies in Taiwan, and obtained 2,149 patents (928 domestic and 1,221 foreign). Over 26,000 companies have received help from the ITRI.

Institute for Information Industry

Since 1979, the Institute for Information Industry (III) 財團法人資訊工業策進會 has striven to increase Taiwan's global competitiveness through the development of its information technology infrastructure and industry. It has been a key contributor of technology to Taiwan's information and communications technology (ICT) industry while playing a vital role in promoting the adoption of ICT in both the public and private sector. With nearly 1,400 employees (68 percent of whom have a master's or higher degree), the III has served in a number of capacities, including serving as a think tank on ICT policy, providing innovative R&D and interoperability standards for the ICT industry, promoting ICT applications, and bridging the digital divide. The III has established four major research institutes specializing, respectively, in information engineering, network and multimedia, advanced e-commerce, and digital education. Since 1999, these institutes have, on average, licensed 50 technology transfer cases to 40 domestic IT companies and filed more than 100 patent applications annually.

The III is aiding the progress of the e-Taiwan project, which aims to transform Taiwan into one of Asia's most digitized countries. It also promotes a project to bridge the digital divide so that remote and less developed areas will have better access to IT applications. Moreover, the institute offers training courses for IT professionals. In the past 26 years, over 300,000 people have benefited from III training programs.

Development Performance

On January 20, 2005, the establishment of the Kaohsiung Biotechnology Park was approved, and US$148.4 million was allocated to create an infrastructure and install equipment in the park over the period 2006 to 2010. The competitiveness of Taiwan's biotechnology industry will be aided by the presence of this biotechnology cluster, which, it is hoped, will allow for the comprehensive integration of R&D, test runs, and production.

Nanotechnology

Following the Executive Yuan's pledge to make Taiwan a world leader in the nanotechnology industry, the National Nano Device Laboratory was founded in 2002. Also because of this pledge, a national S&T program was launched to bring together related industries, academics, and research centers to develop the nanotech platform technologies needed for academic excellence and industrial applications. A budget of almost US$670 billion has been allocated for this project for the period 2003-2008. In September 2006, New York-based analyst firm Lux Research predicted that Taiwan would occupy a dominant position in nanotechnology within the following three years.

Traditional manufacturing firms that apply nanotechnology to established production processes are the major beneficiaries of the government's moves. New investments are primarily in the high-tech sector, and are being used for work on displays (LED, optical, and flat panel), data storage and communications, and integrated circuits. With continued future growth, Taiwan is expected to have around 1,500 nanotech manufacturers, with total production reaching US$29.41 billion by 2012.

The number of nanotech patents has witnessed considerable growth. For instance, between 1990 and 1999, Taiwan was granted 131 US patents. This figure almost doubled between 2000 and 2003 to 244, making Taiwan the sixth-largest recipient of related US patents. It is hoped that Taiwan's nanotech production value will reach US$29 billion, or 3 percent of the world market, by 2010.

After undergoing a battery of stringent tests, six products were granted the first Nano Mark 奈米標章 certifications at a ceremony held in late 2005. The tests validated manufacturers' claims regarding the particle size and chemical constitution of their products' nanoingredients and their advertised efficacy. Taiwan's Nano Mark is the world's first government-established system for certifying nanoproducts.

Space Technology

The 6-in-1 FORMOSAT-3 package of micro-satellites, made in Taiwan and launched in California in April 2006, is used for weather forecasting and terrestrial gravity research. (Courtesy of National Space Organization)

Taiwan has successfully capitalized on its high-tech prowess to develop an advanced aerospace industry. In January 1999, Taiwan became the 15th nation to own an artificial satellite with the launch of FORMOSAT-1, a joint project between engineers from Taiwan and the US, from Cape Canaveral, Florida. Before its retirement in June 2004, the satellite transmitted scientific data back to Earth for use by oceanography experts around the world, contributing to both domestic and global scientific research.

Taiwan's second satellite began a five-year monitoring and research mission in May 2004. It provides near real-time images to monitor Taiwan's environment and resources, predict crop yields, and assess damage from natural disasters. The satellite also helps researchers investigate lightning in the upper atmosphere by providing pictures otherwise unattainable in poor weather conditions.

A Taiwan-US venture to develop a third satellite project, FORMOSAT-3, commenced in January 2001. This constellation of six micro-satellites, shipped to California in December 2005 and launched in April 2006, carries global-positioning-system receivers and other instruments that collect data for monitoring atmospheric conditions and conducting research on Earth's climate, ionosphere, and gravitational field.

Taiwan's space program has given local firms that supply satellite components, such as specialized computers and S-band antennas, incentive to allocate more resources to R&D. A space technology foundation has been established to enhance the competitiveness of the local high-tech industry.

Information and Communications Technology

Since its accession to the World Trade Organization (WTO), Taiwan has deregulated its telecommunications market and stepped up efforts to complete a global information and communications infrastructure. The e-Taiwan project, part of the Challenge 2008 National Development Plan, was designed to breathe new life into information and communications technology, provide highly efficient government services, and raise the competitiveness of the IT industry. In addition, it is hoped that the project will provide the people of Taiwan with opportunities to learn, develop an "intelligent transportation system," and accelerate Taiwan's transition to a knowledge-based economy.

To make knowledge more readily attainable, about US$1 billion has been allocated to expanding from 2004 to 2008 the area in which wireless Internet access is available. This project builds upon two of Taiwan's advantages: possession of one of the world's highest cell phone penetration rates, and production of the most wireless local-area network cards in the world.

With Internet subscribers exceeding 13.76 million as of September 2005 (an increase of 2.55 million compared with September 2004), online government services ranging from tax-filing to business registration have become increasingly popular. In 2003, Taiwan began making IC identification cards, which allow access to a number of online government services and searchable databases. Bilingual e-government websites are also available in Chinese and English for citizens and foreigners who are seeking comprehensive information about Taiwan. (See also section on telecommunications in Chapter 14: Transportation and Telecommunications.)

Related Websites
E-government：	http://www.gov.tw
National Science Council：	http://web.nsc.gov.tw
Science and Technology Advisory Group of the Executive   Yuan：	http://www.stag.gov.tw
National Space Organization：	http://www.nspo.org.tw
Hsinchu Science Park：	http://www.sipa.gov.tw
Southern Taiwan Science Park：	http://www.stsipa.gov.tw
Central Taiwan Science Park：	http://www.ctsp.gov.tw
Industrial Technology Research Institute：	http://www.itri.org.tw
Institute for Information Industry：	http://www.iii.org.tw

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