OPINION: High-Tech Taiwan Must Truly Digitize Its Government

OPINION: High-Tech Taiwan Must Truly Digitize Its Government
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What you need to know

Taiwan could do more to roll out the carpet for internet businesses, a move that would improve the country's economic and political situation.

Taiwan has one weapon that China doesn't — a free and open internet, able to respond to the needs of global internet users.

Underpinned by Taiwan’s stable political, legal, and financial institutions, the establishment of a globally accessible e-business environment would put the economy at the forefront of the government’s campaign to win international recognition.

Global entrepreneurs setting up businesses in Taiwan would also be able to tap into a highly educated high-tech labor force which would increase employment and put upward pressure on wages.

Taiwan’s digital sovereignty

Following Panama’s recent decision to break off diplomatic ties with Taiwan in order to recognize the People’s Republic of China, the government now only has formal relationships with only 20 nations. China’s long-term strategy of systematically isolating Taiwan by individually poaching allies appears to be heading towards inevitable and complete detachment from the international community of sovereign nation-states. This reality is a direct threat which must be addressed.

Because it will be increasingly difficult for Taiwan to continue developing bilateral economic relationships with other countries, it must pursue alternate strategies to secure long-term prosperity and growth. Establishing an open e-business environment accessible to citizens from every country in the world would be the key to potential success for two reasons — it would allow Taiwan to exercise a new form of digital sovereignty and it enable direct engagement with globally-minded entrepreneurs.

Without doubt, the question of Taiwan’s territorial sovereignty will always be viewed in relation to China’s military power and political legitimacy. Given the growing strength of both, relying solely on claims of de facto independence is not a tenable position. Taiwan can however leverage and extend the advantages of this de facto independence into cyberspace by transforming policies and institutions to suit the digital realm.

Domestic companies across Taiwan enjoy the sense of security imparted by strong rule of law and democratic political stability. By allowing foreigners to become “e-residents” and incorporate businesses through web-based services, they can also receive the benefits of a safe commercial climate that are exclusive to local companies today. Viewed from this perspective, it is clear that the Ministry of Economic Affairs (MOEA) has a massive opportunity to promote investment in Taiwan by extending the supporting role of existing institutions to new businesses through the power of the internet.

Creating a single, integrated online gateway for business set-up and administration by e-residents would be the first milestone in establishing Taiwan’s digital sovereignty.

A natural consequence of this approach is that it would allow Taiwan to circumvent the constraints imposed by continued economic and political isolation through direct engagement with global entrepreneurs. In addition to attracting investment capital, an e-business environment would act as a platform for building bridges of cultural understanding and exchange which could assist the growth of other critical sectors such as tourism and manufacturing.

While the Taiwanese business environment has been very successful in enabling the growth and development of existing IT firms, it is still relying on outdated processes for establishing the next generation of innovative businesses.

Global entrepreneurs setting up businesses in Taiwan would also be able to tap into a highly educated high-tech labor force which would increase employment and put upward pressure on wages. Furthermore, banks receiving deposits of investment funds from e-businesses would steadily grow their capital base and be able to extend more credit locally, thus producing beneficial knock-on effects.

While the possibilities outlined above are clearly desirable outcomes in and of themselves, we should also be cognizant of the positive reputational impact this strategy can generate for Taiwanese business climate at large.

Living up to its reputation

Taiwan is globally recognized as a leader in the IT industry, having been ranked sixth overall in competitiveness by the Economist Intelligence Unit. While the Taiwanese business environment has been very successful in enabling the growth and development of existing IT firms, it is still relying on outdated processes for establishing the next generation of innovative businesses. Addressing this deficiency is a necessary first step of building out a nascent e-business environment.

For a foreigner to incorporate a business in Taiwan today, they must suffer through an arduous set of manual, paper-based tasks that aren’t integrated into a streamlined flow. Obviously, such an antiquated process requires prospective entrepreneurs to travel to Taiwan to manage these tasks. If the MOEA strives to be a credible supporter of technology innovation, it needs to leverage industry and network knowledge to bring business incorporation into the 21st century. Luckily, Taiwan can look to other countries for examples of successful implementations as we design a solution tailored for Taiwan.

Following in the footsteps of programs recently pioneered by Estonia, e-business systems should follow a few guiding principles while duplicating popular features.

In keeping with Government-as-a-Platform (GaaP) design philosophies, it is clear that Taiwan should strictly adhere to the following principles:

  1. Repurpose existing data where possible​: For the purposes of e-business registration this means passing along provided information to other ministries, banks, and service providers through authorized API access.
  2. Build a singular, extensible platform​: The current process requires interaction with numerous forms across various groups and departments. This complexity should be hidden from the end user through backend integrations.
  3. Do it yourself (DIY), or don’t do it at all​: e-business registration and administration should strive to be entirely self-service. Any actions that require administrative approval should be automated where possible and focused on speed and efficiency.

At the moment, incorporating any kind of business requires the notarization and certification of many document types. Once this is accomplished, those same documents need to be sent a bank for an account to be opened. To further compound these annoyances, most of the required forms are only available in Chinese. Without full support for English speakers throughout the registration process the program will struggle to gain traction internationally.

As such, every screen of the e-business online service needs to communicate through a consistently simple design language that emphasizes action-oriented tasks. All inputted data would be retained for future sessions and accessible to third-parties (such as banks) with the authorized permission of the user. An additional advantage of this platform design is that it would lend itself well to addition of extensible services for accounting, human resource management, legal advice, and more.

By creating a user-friendly one-stop shop for e-business registration and administration we can enhance Taiwan’s reputation as a leading IT innovator while spurring economic growth and investment.

Challenges ahead

The strategic case for establishing a globally accessible e-business environment is sufficiently clear. Despite the massive opportunities this program could generate for the MOEA specifically and Taiwan generally, there are probable challenges to implementation.

First and foremost, the success of such an initiative is largely dependent on the relative competitiveness of relevant policies such as corporate tax rates, local employment laws, loan programs, and more. Simply put, a well-designed, streamlined e-business system will only be as successful as the supplementary policies that make doing business in Taiwan desirable.

In addition to policy coordination, this strategy also calls for cross-functional collaboration to make critical IT systems interoperable. Beyond safely sharing data across departments, Taiwan's government also needs to ensure adequate levels of technical training by civil servants who will be taking administrative actions to ensure consistently high-quality service delivery. Moving from largely analog systems to entirely digital processes will require significant retraining programs and cultural adjustments.

Despite these difficulties, it is imperative that Taiwan forges ahead with this initiative. Succeeding in this endeavor alongside the government’s other digital transformation projects will bring Taiwan into the international spotlight in the 21st century.

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TNL Editor: Morley J Weston