Hello everyone, welcome to Taiwan Bar Today let’s talk about Taiwan’s famous economic miracle Out of many Asian countries Taiwan, Hong Kong, Singapore and Korea developed advance economies therefore are called the “Four Asian Tigers” Although Taiwan is more like a kitten then a tiger now Still, the story of our economic success has more to it than just the well-adopted government policies Many recognize Taiwan as one of the Four Asian Tigers But do not know how the miracle happened In 1945, the Great East Asia War in the Pacific was terminated industrial infrastructure in Taiwan built under Japanese rule like electricity, telecommunication and oil refinery and many more were destroyed by the Allied Forces At the time, Taiwan seemed to have no future and the economy was like “once a good girl gone bad, she’s gone forever” When the ROC government suddenly became an victorious nation and took over Taiwan Taiwan’s economy were then influenced by China and made the Chinese Civil War affect Taiwan Inflation rate, unemployment rate and public discontent rised greatly So How did Taiwan overcome all obstacles and climb its way up? and how did the economic miracle came about? Ahem, let’s begin! In 1949 the currency was no difference from monopoly money due to inflation therefore national monetary reform took place 40 thousand Old Taiwan dollar can be exchanged for one New Taiwan Dollar (NTD) that we are still using today The use of NTD pulled us out from the falling economy influenced by China and decreased the damage of inflation but KMT who were in great debt after moving to Taiwan had no extra fund to help Taiwan’s economic to takeoff …ur nope I mean to revive Taiwan’s economy And just when the government was under the pressure of communism and public discontent
and was only planning retaking the Chinese Mainland but had no actual ability to perform the act a war erupted out of the blue and rescued Taiwan’s economy It was Hanja Ahem It was the Korean War... war... war… simida... This North-South simida~ Korean War started fiercely...simida yo~ and Mao Zedong, in order to resist U.S. aggression and aid Korea transferred his army that was originally trained to take back Taiwan, to North Korea The US then set up a defense line from South Korea to Malaysia to fight against communism Although Uncle Sam didn’t valued KMT very much but no matter what, Taiwan held a key position to the defense line So Uncle Sam didn’t have much of a choice but to sign the Sino-American Mutual Defense Treaty Afterwards, all kinds of support came from the US which was the so-called US Aid From 1951 to 1965 the monetary total of the US Aid was up to 1.5k million USD During the time, everywhere in Taiwan you could see residents lining on the street for supplies and children wearing underwear made from flour bags with the Sino-American labels Aside from daily supplies the US Aid also invested heavily on Taiwan’s agriculture and infrastructure From Shihmen Reservoir, Siluo Bridge to Central Cross-Island Highway are all results of the US Aid In short, the depressed post-war economy was rescued by the US Aid fairy The barely breathing ROC government gradually revived again Besides the US Aid The government also had to do something on their own to save itself In 1949 Taiwan Provincial Government carried out land reform hoping to improve farmers’ living conditions the 37.5% Arable Rent Reduction Act that restricted the limit of Arable Rent to 37.5%, the Public land release that allowed farmers to own public land and the Land to the tiller act that lets the farmers to keep the land instead of the landlords These reformations changed the fate of farmers and landlords The land reform seemed like a great policy It could bridge the gap between the social classes and save the farmers from suffering but, it also robbed the landlords of their properties The Landlords thought why on earth did the Arable Rent need to be reduced why on earth should my land be taken away why on earth is my land not mine after one night But at that time, Taiwan was in the period of White Terror Governor of Taiwan Province, Chen Cheng once said “The 37.5% Arable Rent Reduction Act must be conducted without hesitation. There might be difficulties, since there are always shameless people who will not follow orders, but I believe, there are never people who would put their life at risk.” With just a few words, he frightened landlords to death Even if they weren’t willing to follow, they kept silent and did as told No matter what the monetary and land reform, plus the US Aid gradually revived Taiwan’s economy after the war Cotton yarn sent from the US help developed the textile industry Wheat sent from the US help developed the food industry And because of the US aid Taiwan was able to make noodles, breads and doughnuts Taiwanese who used to take rice as our staple food gradually accepted noodles and other flour-made food under promotion of the government Daily necessities that used to rely entirely on imports now could be produced and replaced imports this is the stage called the Import Substitution Period Until 1960s The US Aid ended Besides being a cry baby, Taiwan had to think of new methods to help the economy Like the Export Processing Zone set up at that time and the Investment Incentive Act, carried out by the government were all method that were hoping to encourage investments and replace the US Aid The Investment Incentive Act allowed many companies and investors to enjoy tax reduction But did these profits made from companies really benefit Taiwan? And did these profits go into the pockets of big enterprises or regular citizens? Under the assistant of the government, many private companies began to thrive and those who originally sold rice or done logging became CEOs In short Taiwan’s economy turned export orientation GNI, GDP increased substantially What an amazing government that rescued the society, right? But Exporting won’t work just by planning we need to have customers as well Luckily, Taiwan caught up with the International division train and replaced Japan who was moving on to the next economic stage and became the OEM of industrial products That’s why Taiwan started to sell sell sell, and foreigners got to buy buy buy Wait a sec! There’s something to be clarified Speaking of the Ten Major Constructions Projects people seem to consider them the representative of Taiwan’s economic miracle, don’t they? This large-scale of post-war public constructions of course contributed greatly to the livelihood economics especially to land and air transportation For example the North Link Line connected the east and the west, reducing travel time and the Formosa Freeway, though criticized that it was built for the rich turned into the transportation lifeline of Taiwan not to mention the largest airport in Taiwan, Taoyuan International Airport was off to a flying start and to a flying end….ur nope Takeoffs are still happening each day But honestly, some constructions used to be useful and some aren’t equally useful nowadays like the Port of Taichung, built to be the international port of central Taiwan However, it seemed that they missed a few geography classes causing the port to encounter many problems with tides and silt, and spending the government a great fortune on maintaining Moreover, the SMALL Su-ao Port was dragged into being a part of the Ten MAJOR Constructions The result of expanding such a small port caused a large budget deficit Until the 70s, under the emphasis put on being environmental friendly Petrochemical industry and the nuclear power plants in the Ten Major Constructions although seemed helpful to Taiwan’s economy but brought out protesters due to the pollution issues Had the government predicted that some constructions might be untimely after they were constructed Perhaps, there are some things you will regret tomorrow if you don’t do them now but looking at these constructions fails, maybe for a few things you will still regret tomorrow even if you do them today After saying so much we seemed to understand a little more about Taiwan’s economic miracle In the time of globalization economic development not only requires our own efforts but looking out for the international trend is equally important In the past, the economic miracle seemed like a smooth sailing however, the sacrifices behind and the side effects it caused should not be ignored Environmental pollution and agricultural damage plus the worsening disparity between the rich and the poor should teach us a lesson What kind of a development are we pursuing? We used to be taught that Taiwan founded on farming, and went through export processing stage then relied on light industry, heavy industry, high tech to service industry blah blah blah... The economy development was like climbing on a ladder all we had to do was climb step by step and we should meet success don’t think, don’t whine, don’t hesitate But is this how it should work? Is it possible that a ladder might be suitable for others but not for us? Or is it possible that we discover nothing at the top of the ladder and find that it is an one-way trip? Or even if we assume there exist a globally suitable ladder on which step of the ladder is Taiwan currently stand on? And where should the next step lead us? Ok after saying so much. I am getting kind of thirsty after drinking this piece of chicken cake(...?) See you same time next month! Bye Taiwan Bar is produced by DJ Hauer Scripted and hosted by Buchi "it’s our second-to-last episode!" History context provided by Thomas the choo-choo train, who is dating all the time and have no time for us... Animated by jiajiach, who stays healthy and pretty and only eats vegetarian pizza Music produced by DJ Hauer If you like our videos, please subscribe to our channel Or you can click here to get our products (They are almost sold out!) We will upload new episodes at 8 pm on the first of every month Okay, that’s it Yeah~ we can finally eat the chicken cakes Hey, where did you get the chicken cakes? Kris gave it to me Kris who? Kris, the boss of Philosophy Philosophy Chicken Cake Evening, evening, good evening I am Kris from P. P. C. C. Starting next month I will teach you how to make a desert in every episode And talk a little about philosophy while we are at it You might have indigestion problem eating while listening to philosophy But that’s alright, I will eat what you can’t Evening, evening, good evening, I am Kris See you next time in P.P.C.C.!
