Over the last 25 years, the demographic landscape of Taiwan has dramatically changed. In February 2015, the Taiwanese government revealed that Taiwan’s working population (aged 15 – 65) will start shrinking by 180,000 annually in 2016 and that the number of workers will peak at 17 million in 2015. If nothing is changed, the working population will fall to 9 million in 2060, or just 50 per cent of the total population. This trend poses a serious threat to national development. Relevant government agencies have been directed to reassess policymaking in the areas of education, industrial development, social services and immigration.
Immigration will serve as a crucial means of addressing the problems associated with the demographic challenge of a shrinking workforce in Taiwan. This is a problem that has seized many other countries in Asia. Daunting demographic challenges have been broadly discussed in Japan, China and South Korea as well. The advantages of Taiwan increasing its foreign workforce are numerous. Some obvious examples include filling workplace gaps, diversifying the workforce and assisting Taiwan in becoming a more multicultural and cosmopolitan island. A more open immigration policy would also revolutionize Taiwan’s manufacturing and export-oriented economy. This would have the added benefit of attracting foreign investment, which is always made easier when a country has a solid base of highly skilled foreign workers living in the country.
Table 1 below outlines the rise in immigration of two of the three key migrant groups in Taiwan since 1995. Two key points can be taken from this: First, the number of migrants working as labourers in Taiwan has now reached a level that sees them as irreplaceable. Second, more needs to be done to encourage skilled foreign workers to come to Taiwan.
Table 1. Foreign Residents at 10-Year Intervals
|Total Foreign Residents||Total Foreign Labour Workers||Skilled workers (Engineers, teachers, technicians)|
Source: National Immigration Agency (April 2015)
Although the number of foreign residents living in Taiwan has increased impressively over the past 20 years, there is a distinct stagnation in the immigration of skilled workers to the island. Table 1 shows that skilled workers in the fields of engineering, teaching and technical studies have stayed stagnant at around 10,000 for the past 10 years. As a percentage of the foreigners in Taiwan, this has dropped from 2.5 percent in 2005 to 1.5 percent in 2015. This can be attributed to poorly targeted immigration policy in these fields, which has provided no incentive for skilled foreign workers to come to Taiwan, especially when compared to other competitive Asian nations. In other Asia-Pacific countries with a similar population size, the number of skilled foreign workers given visas each year is much higher. In Australia, more than 120,000 places were made available in the 2015-2016 skilled migration scheme. In 2015, South Korea welcomed upwards of 49,000 highly skilled migrant workers. More than 33 percent of these were foreign language teachers—a source of migration that Taiwan has not yet fully utilized.
According to the Oxford Economics Global Talent 2021 Report, Taiwan is facing the most pronounced talent deficit trend among the 46 countries examined. Factors assessed include economic growth, population change, industry competition and immigration. Taiwan loses between 20,000 – 30,000 white collar workers each year to countries with better opportunities. Reforming the Taiwanese immigration system is essential in order to address this problem.
For Taiwan to further diversify its demography, modernise and become more competitive with other advanced economies, more needs to be done to encourage skilled foreign workers to come to the island. The government has worked hard recently to address these matters with its New Southbound Policy and the National Development Council’s Plan for Retention of Talent in Taiwan.
Changes outlined in these plans include:
- Issuing six month intern visas to recent undergraduates of foreign universities, with an extended stay of maximum one year.
- Issuing “Personal Employment Passes” to high level foreign professionals.
- Permitting foreign spouses to engage in full-time or part-time work.
- Removing the renunciation requirement for high-level professionals and conditionally permit dual nationality.
- Amending the Immigration Act to permit spouses and minor children of applicants for permanent residency to apply for permanent residency simultaneously.
- Simplifying visa applications by creating a single online platform for foreign professionals to obtain visas, Alien Residency Cards, and work permits and by accepting English-language documentation and eliminating the Chinese translation requirements for authentication of visa documents.
The measures outlined above would thoroughly modernize Taiwanese immigration policy. These changes would make it easier for foreigners to gain employment in Taiwan after graduation, ease restrictions on visas for high-skilled workers and address institutionalised problems in Taiwan that dissuade foreigners from wanting to live and work there. Each issue is linked to Taiwan’s demographic challenges and will assist in shifting the country towards a younger, more professional and more dynamic population.
There are a number of concerns that have not been addressed in the plan that need urgent attention if the government is serious about addressing immigration policy and, in turn, demography.
First, changes to the work permissions for foreign spouses should include the foreign spouses of permanent residents, not just citizens. The Ministry of Labor has recently permitted foreign spouses of citizens to work full or part time with certain conditions, but not the spouses of permanent residents.
Second, the requirement of renunciation of original nationality should be eliminated. Currently, it is not possible to be a dual citizen of Taiwan and another country. Taiwanese law stipulates that one must renounce their original citizenship before being permitted to become a Taiwanese citizen. In order to simplify the lives of foreigners in Taiwan, it is necessary to allow for dual citizenship. This simplification will improve the perception of life in Taiwan and incentivize more people to want to live and work on the island. A bill (904-1846) before the Legislature seeks to change this, but it is not yet clear if it will pass.
Third, there are no proposals to allow for permanent residents or even citizens to sponsor elderly parents to live in Taiwan. This is a common element of immigration policy in many countries and is important for Taiwan to consider.
Finally, reconsideration of the “high-level professional” visa category is needed. Foreign professionals with extraordinary ability have been permitted to apply for Permanent Residency (Plum Blossom Cards) since 2006, but very few cards have been issued over the past decade Any definition of “high-level professional” must include a reasonable understanding of the realities of the employment market in Taiwan. This visa class could be better utilized by broadening it to allow a greater number of high-level professionals to live and work in Taiwan.
The Taiwanese government has requested direct public feedback on its proposed reforms in this area, which is a good sign that these changes are being deeply and carefully considered.
Overall, the changes in each of these new plans are overwhelmingly positive for Taiwan, and will help to better embed Taiwan into the fabric of the Asia-Pacific region. President Tsai Ing-wen and Taiwan’s government have identified areas where Taiwanese competitiveness is lacking and are acting to help address these. These changes have the added benefit of addressing Taiwan’s demographic challenges, and filling gaps that desperately need attention.
The main point: Taiwan faces serious demographic challenges that threaten to hamper its international competitiveness. New immigration measures implemented by the Taiwanese government, if passed, will assist in addressing these demographic challenges.