New institutional system urged for knowledge-based economy

By Alfed Lee, The China Post

The government needs to build new institutional systems to sustain economical growth in the new knowledge-based e-century, stated Liu Chao-shiuan, newly elected chairman of Monte Jade Science & Technology Association of Taiwan (MJSTA) yesterday at the summit forum “Connecting the Future”. Liu, who was the former premier of the Executive Yuan, said that the institutional infrastructure should include a more updated and flexible legal framework which allows entrepreneurs to get venture capital much more easily while the risks involved with new ventures can be shared and minimized.

The modernized institutional infrastructure will provide an environment which serves as the cradle for “the new stars of tomorrow”, Liu said.

The success of Taiwan’s high tech industries in the past two decades was due to a proper blending of certain requisitions and coincidences. The requisitions were the government initiatives and measures adopted to train R&D personnel. For example, the institution of the Industrial Technology Research Institute (ITRI) and Telecommunications Lab. has not only trained a large pool of R&D engineers, but also helped developed the technical know-how critical to the development of Taiwan’s PC and semiconductor industry. Taiwan’s opportunity to manufacture the PC at a good timing is one of the coincidences. In the new economy of the e-century the government and the private sector need to work together to achieve an optimal blending of the requisitions and the coincidences, and to integrate all the resources so that the human, capital, and technological resources can be deployed and interchanged in the most desirable and efficient way. To maintain Taiwan’s competitiveness, the small and medium businesses need to transform their operations to the knowledge-based mode. Instead of maintaining the manufacturing capability as their competitive edge, small and medium businesses should protect their core technology at their leading edge.

Taiwan is not ready to meet the challenges of the e-century. “We still need reforms and innovations to create more value in the new e-century,” the former vice premier said. What MJSTA can do is to make a call for the nation to work together to build a “knowledge-based economic community” so that success stories can be shared with all the people in this community.