Are you planning to boost your career overseas? Have you ever considered Taiwan? The island is striving to move ahead of its powerful competitors, namely mainland China and Hong Kong. So, how is the country attracting international talent, and what are the reactions of its competitors?
Taiwan's strategy to attract expatriates
Taiwan is rolling out the red carpet to skilled foreigners. The government recently announced an extensive plan to recruit 400,000 foreign professionals by 2030. The authorities are planning to ease the rules for skilled expatriates and foreign self-employed persons seeking the Taiwan Employment Gold Card, a three-year visa with a work permit. While Taiwan issued 3,200 such visas in 2021, this year, the number was down to 2,500. The government is therefore looking to extend the duration of visas, speed up the transition to permanent residence and encourage digital nomadism.
The head of Taiwan's National Development Council, Kung Ming-Hsin, detailed the government's plan to attract expatriates at the Talent Sustainability Forum held in Taipei. Taiwan's strategy rests on 3 pillars, namely:
- The strengthening of international executive recruitment.
- Incentives to attract and retain more Chinese and international students.
- Retention of more migrant workers.
The Taiwanese government is relying on fresh university graduates to boost its economy. Like many other countries, Taiwan makes a clear distinction between "white-collar workers", usually international executives, and migrant workers. The government clearly emphasizes the need for more "white collar" workers in its plan.
But what is the best way for Taiwan to attract these new workers? Do international issues play against Taiwan or in its favor? How to attract foreigners with Chinese origins or those coming from Hong Kong? In response to these questions, Taiwan firmly believes in its massive investments in innovative and cutting-edge technologies. Launched in 2016, the "5 plus 2" plan is a vast industrial innovation program. According to Kung Ming-Hsin, this plan is indicative of Taiwan's drive to modernize its industry and stimulate sturdier growth. The government is thus expecting the boom in new technologies to create new jobs that are more likely to attract qualified foreigners.
Taiwan's demographic challenge
By the end of 2020, Taiwan had 23.8 million inhabitants, with 22.9 million Taiwanese nationals and 921,000 foreigners. But overall, the Taiwanese population is getting older. In 2020, for the first time, the number of Taiwanese people of working age (15-64) dropped to 16.6 million people, excluding foreigners, whose number dropped by 169,000 since 2010. Taiwan has one of the lowest fertility rates in the world, but this is not a new issue. In 2014, the country was already concerned about the rapid aging of its population. In 10 years, the Taiwanese population has grown by just 1.6 percent, while the number of foreigners has risen by 63.8%, according to figures from Taiwan's Ministry of Foreign Affairs). The government, therefore, intends to counteract this demographic crisis by attracting more foreign workers.
Hong Kong's response to the international talents' race
Taiwan is one of many countries seeking out qualified foreigners. In this race for international talent, Hong Kong is also scoring points. In an October 19 speech, John Lee, Hong Kong's China-picked head of government, stated that the country must be more proactive and aggressive when competing for business and talent. Besides actively encouraging and retaining local skills, the government is committed to proactively scouring the world for talent.
Hong Kong is also in a state of emergency. The country has lost 140,000 workers since the Covid pandemic. Not only has the socio-political environment caused many foreigners to leave the country, but the health crisis management has also scared them away. In this particular context, Hong Kong's leader Lee is facing a daunting task: to make Hong Kong an attractive financial and investment stronghold again.
Competing with Taiwan, Hong Kong is also under pressure from Singapore and Dubai. In fact, in September, Singapore overtook the Special Administrative Zone (SAR) in the ranking of financial centers. Incidentally, John Lee has been announcing new measures to attract and retain foreign talents. For instance, he announced a new scheme dedicated to top talents earning 2.5 million Hong Kong dollars or who have graduated from a top university. This new program should allow them to work and develop their business in Hong Kong for 2 years. The Chief Executive also announced the setting up of a task force to facilitate the recruitment of foreign talent and the creation of a help desk that will assist these new immigrants. The new visa introduced in August also has similar goals. It's all about enabling foreigners to benefit from tax breaks, including a tax deduction for first-time real estate purchases for permanent residents.
Will this be enough to attract international talent? According to CNBC, the expat exodus paced up in 2022. In total, 93,000 residents left Hong Kong in 2020. They were 23,000 in 2021 despite the lockdown. Moreover, CNBC estimates that a larger number of expats will be leaving this year.
China's response to the battle for foreign talent
On November 4, German Chancellor Olaf Scholz met with Chinese President Xi Jinping and set the tone. Despite being criticized in the European Union and in his own camp, who fear an increase in Germany's dependence on China, Scholz asserted his willingness to "further develop" his country's economic partnership with Beijing. This represents a significant boost for the world's second-largest economy, which is seeking to attract more qualified foreigners. Besides, Scholz was accompanied by a delegation of German business leaders. China, for its part, seems keen on using these partnerships to strengthen its international leadership. The Chinese government boasts the number of foreign companies established in the country to attract highly skilled expats and businesses. One of the best examples is Decathlon, a French sports equipment giant that has been operating in mainland China since 2003.
Although its zero Covid policy is officially still in force, China is progressively reopening its doors to foreigners. International students are back in Chinese schools and universities in small batches, country by country. This is a way for China to improve its image besides relying on its economic power to attract foreign talent. However, the task may prove to be more difficult than expected, as the way in which the country managed the health crisis made a long-lasting poor impression. As a result, many expatriates have left China, fed up with the endless zero Covid policy.
Don't Hong Kong and Taiwan pose a threat to China in the race to recruit foreign talent? Well, it seems that Chinese authorities have a different take on the situation. Chinese authorities are confident that the number of foreign professionals will return to and exceed its pre-COVID level. In any case, Beijing's unique strategy remains the consolidation of its economic power.
