Island to rank 6th in manufacturing edge: firm

The 2013 Global Manufacturing Competitiveness Index (GMCI) was produced by Deloitte Touche Tohmatsu Limited's (DTTL) Global Manufacturing Industry group and the U.S. Council on Competitiveness.

According to the forecast, Taiwan's 2013 ranking can be attributed to the country's competitive advantages in the areas of corporate tax rates, trade, infrastructure and workforce development. The GMCI report said given Taiwan's high level of economic freedom and established manufacturing sector the country has the potential to emerge as a global research development and production center.

The GMCI said Taiwan has a strong tie with Western economies, is pursuing new free trade agreements and working to improve relations with China in efforts to boost cross-strait trading.

The forecast listed the country's competitive disadvantages, notably concerns about intellectual property protection as well as high energy and material costs due to a lack of natural resources.

Stalwarts to Be Challenged

The GMCI report said that over the next five years, 20th-century manufacturing stalwarts like the United States, Germany and Japan will be challenged to maintain their competitive edge against emerging nations such as China, India and Brazil.

Based on in-depth analysis of survey responses from more than 550 chief executive officers and senior leaders at manufacturing companies around the world,

the GMCI said that the competitive manufacturing landscape is undergoing a massive power shift.

The GMCI forecast that China will be the most competitive manufacturing nation in the world in 2013. Germany and the United States rounded out the top three rankings. The index also forecast that China will retain its top position five years from now.

The forecast said Germany will fall to fourth in 2018 while the United States will place fifth in that year, only slightly ahead of the Republic of Korea. The other two developed nations currently in the top 10 are also expected to be less competitive in 2018. Canada will fall from seventh to eighth place, while Japan will drop out of the top 10 entirely, sliding to 12th place.

The report found that access to talented workers is the top indicator of a country's competitiveness — followed by a country's trade, finance and tax systems, and then the cost of labor and materials. Enhancing and growing an effective talent base remains core to competitiveness among the traditional manufacturing leaders — and increasingly among emerging market challengers as well.

The GMCI indicated that Taiwan's advantages lie in its electronics industry — the country's primary export driver — and its function as a base for foreign semiconductor companies.

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