The Human Factor Key to the Taiwan Miracle

Over the last 70 years, Taiwan has created an economic miracle. Per capital GDP has grown from US$150-200 in 1952 to US$34,000 today, life expectancy from 53 years to 80.1 and adult literacy from 58 per cent to 98 per cent. Population growth rate has fallen from four per cent to 0.44 per cent.

In 1952, agriculture accounted for 32 per cent of its economy, now 1.4 per cent, while foreign trade has increased from minus 10 per cent to 63-70 per cent. Today it produces over 60 per cent of the world’s chips and 90 per cent of the most advanced chips.

It has done this with almost no natural resources. It imports more than 95 per cent of its energy and 70 per cent of its food. Mountains cover 60 per cent of the island, and only 23 per cent of its land can be cultivated.

In addition, it has since 1949 had to spend a significant part of its budget on defence, especially expensive weapons from the U.S., to prepare for an attack constantly threatened by China.

The secret of its success has been the wise use of its human capital and creating an environment to promote learning, entrepreneurship, invention and science.

This was celebrated by Lung Ying-tai (龍應台), former Culture Minister and a famous author, in a speech at the Third Li Guo-ding Prize Ceremony in Taipei on November 10.

She used the lives of two famous entrepreneurs to show how human talent has created the miracle -- Stan Shih ( 施振榮) and Shih Chin-tay (史欽泰).

Born in December 1944, Stan Shih founded Acer Inc in 1976. It became one of the world’s biggest computer hardware and electronics firms and Taiwan’s first global brand.
Born in 1946, Shih Chin-tay is one of the fathers of Taiwan’s semiconductor industry. From 1994 to 2003, he was president of the Industrial Technology Research Institute, Taiwan’s premier IT research institution. He has held many senior positions in government and business.

Lung said that both men were born into poor rural families. Stan Shih lost his father when he was three and helped his mother run a small grocery shop. His first maths lessons were calculating the prices of the duck eggs they sold.

Chin-tay grew up in a fishing village in Jiading country in the far south. Fishing boats sometimes did not return. On the beach, he found human legs cut off by large fish. He earned a Ph.D in Electric Engineering at Princeton.

Stan Shih could have studied abroad but preferred to stay in Taiwan to be close to his mother.

“Taiwan’s semiconductor industry was created by advanced manufacturing, closed testing and a complete production line. It was able to remain competitive through constantly improving education, the scale of research and development and good company management,” Lung said.

She compared the two to British scientist Michael Faraday (1791-1867), who discovered the principle of the electro-magnetic field and founded electric motor technology. “Faraday also came for a poor family but lived in a society that encouraged science and learning. He took advantage of it.”

She said that both Shihs were patriotic and strove to create brands, talent and moral companies for Taiwan. “Stan Shih’s mother told him to be a useful person. This was his mission in life, to create value for Taiwan.

“A person has a responsibility to society, his country and his homeplace. ‘Our country is backward, so we must work hard to make it better,’that is what they believed.

They grew up in a time of material poverty but their spiritual energy was enormous,” she said. “The hard work of one person can change the destiny of a country.”

Lung said that the spirit of today was completely different. “We have received too much, in personal freedom, a more open society and diversification in values. A person has so many choices. He is encouraged to work for himself.”

But society has lost something precious. “The concept of ‘we’ has become confused, the law of the market has replaced social responsibility. Success no longer means progress for the country but personal success,”she said.

The lesson of the two Shih was that excellence in a speciality worked hand-in-hand with responsibility toward the country and personal success with the public interest. “Knowledge and science can become a public good,” she said.

Stan Shih remains active in charity and philanthropic work, as well as being on the board of major companies. Chin-tay is a professor at National Tsing Hua University in Hsinchu.