Taiwan topped the world in terms of state of cluster development in the Global Competitiveness Report 2008-2009 released last month by the Geneva-based World Economic Forum, the third year in a row it had held the top spot.

To build on that advantage, the Ministry of Economic Affairs will invest NT$650 million (US$19.62 million) in a project from 2008-2011 to help 90 innovative industry clusters take shape, including technology traveling, health care and leisure, LED intelligent control lighting, and biomass material applications.

The project is expected to generate NT$18 billion in business opportunities, an official with the Council of Economic Planning and Development confirmed Saturday.

The official said the new project would continue Taiwan’s clear differentiation in its industrial clustering pattern. At present, he said, most of Taiwan’s electronics clusters can be found in northern Taiwan, while central Taiwan is strong in precision machinery and tools, and southern Taiwan offers heavy industrial clusters in steel, petrochemicals and mechatronics.

He also pointed to many conventional manufacturing sectors known for their handicraft skills, such as porcelain and pottery making in Taipei County’s Yingge township, and wood carving in Miaoli County’s Sanyi township.

The diversity and strength of those clusters were reflected in the Global Competitiveness Report, where Taiwan was tied with the United States with a score of 5.6 points in the “state of cluster development category.”

The category is part of a country’s rating for “business sophistication,” one of the report’s 12 pillars that measure 134 major and emerging economies’ abilities to provide prosperity for their citizens.

Taiwan received a score of 5.52 for cluster development in the 2006-2007 report and 5.7 in the 2007-2008 report, with the highest possible score a 7.0, the official said.

Singapore and Italy followed Taiwan and the U.S. with a score of 5.3, followed by Japan and Finland with a 5.2. Filling out the top 10 in the category were Hong Kong, South Korea, Switzerland, and Germany.

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