The Export Processing Zone in the Republic of China is a combination of a free trade zone and an industrial park, designed to promote export-oriented industries by providing a favorable climate for industrial investment. For 14 years, the nation's EPZs have helped to create Taiwan's "juggernaut economy," and provided thousands of new jobs.
Labor-intensive industry is the main feature of the factories in the EPZs, and about 80 percent of workers are women. From the beginning, the Executive Yuan has paid special attention to labor management relations, workers' welfare, and security measures in factories. As living standards have improved, more welfare services have been provided to attract workers.
In the early 1960s, the Republic of China drew up plans to accelerate economic development. As part of this program, economic specialists and scholars prepared the groundwork which allowed the first Export Processing Zone to be established in Kaohsiung in 1965.
To reduce red tape to the minimum, the EPZ administration and its supporting agencies were authorized to act for various government bodies in handling all phases of operations within the zone such as investment application processing and approval, import and export licensing, foreign exchange settlement, company registration, construction licensing and customs clearance.
A warehousing and transportation services center was established to put customs and airlines facilities in one building so as to further expedite all procedures and formalities.
No customs duties are levied on imports of raw materials, parts and machinery, or on exports of finished products from the zone. Sales and commodity tax are waived and a five-year tax holiday is granted to investors. Products of the EPZs, however, must be 100 percent exported in fairness to factories outside the zones.
In order to accommodate more factories, the Ministry of Economic Affairs opened up two more zones, the Nantze Export Processing Zone, and the Taichung Export Processing Zone in 1971. Up to September 1980, 307 factories had been established in the zones with a total capital of US$300 million, coming 70 percent from foreigners, 17 per cent from overseas Chinese, and 13 percent from local sources.
Precision machinery and instruments, electronic, optical, metal, plastic, electrical, chemical and rubber products, machinery, cosmetics, leather products, toys, yachts and mobile homes, garments, medical instruments and appliances, sporting goods, musical instruments, educational materials and communications equipment are the major products of factories in the EPZs. The products are exported to more than 120 countries, 25 percent going to the United States, and 56 percent being accounted for by electronics and electrical products. Last year, total export value of the three EPZs reached US$1,204,730,000, and imports, US$610,050,000, resulting in a net surplus of US$594,680,000.
Industrial technology in the zones has been raised by introducing the newest and most up-to-date technical know-how, and inviting specialists from abroad to provide instructions.
The three EPZs have transformed what was once a wasteland into a thriving industrial park. The Nantze Export Processing Zone, for instance, was originally a low-grade sugarcane plantation area. Today, broad thoroughfares skirted by green trees, pleasing architecture and flower beds provide an ideal working environment. The Branch Administration of the NEPZ, under the direct jurisdiction of the Ministry of Economic Affairs, has been divided into four divisions--investment service, foreign trade, industrial management and labor administration.
The first three divisions were set up to provide services for factories, and the labor administration division to provide welfare for laborers. The EPZ is also in charge of organizing labor unions, solving labor-management disputes, promoting workers' welfare, education and recreational activities, and conducting factory inspections.
Up to the end of September this year, the three EPZs had set up 155 workers' associations, with 58,460 members. A Taiwan EPZ union was inaugurated in December 1971.
Officials of the Labor Administration Division are frank about their problems. "A certain amount of labor-management conflict is inevitable. In handling disputes, we adhere to a principle of 'openness, justice, impartiality, legality, humanity and reason' so as to iron out differences."
Besides urging workers to take out labor insurance, the division appropriates labor welfare funds to provide all kinds of facilities including dining room, service center, health care center and a women's dormitory.
The health care center is in fact a miniature hospital, installed with divisions of internal medicine, surgery, dentistry, ophthalmology, E.N.T., X-ray and clinical laboratory. Equipment provides a complete service and physicians work on a full-time basis.
Close to the health care center is an attractive and large-scale auditorium, called the Chuang Chin Hall, which with 1,012 seats provides an ideal setting for the monthly meetings of the NEPZ's employees and for movie appreciation. Other significant and productive activities have been promoted to make workers' lives more colorful and interesting. A special committee has been organized to coordinate with the China Youth Corps in sponsoring sports, cultural, educational and recreational activities. NEPZ employees are enthusiastic in participating in mountain climbing, ball games, bridge, photography, lectures, literary creation and writing competitions, sponsoring garden parties and presenting Chinese opera.
About 80 percent of EPZ workers are female, with an average age of 18, and most are junior high school graduates. The workers' wages range from NT$4,500 to NT$6,500 per month with a generous bonus and overtime pay. Skilled workers receive higher pay, and have a good chance to become section chiefs if they show competence and talent.
The director of one factory, however, complained about high labor turnover rates. He said: "At first, it was easy to hire skilled women workers. But as education has expanded, more and more people have acquired different specialties which enable them to make a living. Many blue-collar workers have turned to more technology-intensive industry. We are therefore under the constant threat of a labor shortage."
Besides shortening the working week from six to five days, allowing more vacations, providing leisure activities and more benefits, the EPZs have recruited students to boost the labor force and receive on-the-job training at the same time. They can either work on day or night shifts, and students are proud of being able to pay their way in finishing their studies. The EPZ administrations are now planning to shift from labor-intensive industry into the technology-intensive field to provide a more permanent solution to their labor problems.
[Picture Caption]
1. Entrance to the Nantze Export Processing Zone. To the left is the office building of the Branch Administration; to the right the auditorium. 2. Workers motorcycle to work at NEPZ. 3. A corner of an exhibition room in the zone.
1-3. Workers assemble electronic circuit boards. The ducts overhead provide ventilation. 4. A worker checks to see if a product is up to standard, using an electronic inspection screen. 5-7. The health care center in the EPZ is in fact a miniature hospital, with divisions of dentistry, ophthalmology, X-ray and others.
1 & 2. At noon break, the workers take lunch at the EPZ restaurant. 3. A vending counter in a corner of the restaurant sells daily commodities at a low price. 4. Women's dormitory at the NEPZ. 5. Women workers play the guitar and sing songs in their dormitory. 6. Mama Jung is in charge of the girls' room keys. 7. The library and study room in the dormitory.
After a day's work, female workers can play basketball, dragon ball or arrange flowers. Others take the bus or bicycle home.
Workers motorcycle to work at NEPZ.
A corner of an exhibition room in the zone.
Workers assemble electronic circuit boards. The ducts overhead provide ventilation.
Workers assemble electronic circuit boards. The ducts overhead provide ventilation.
Workers assemble electronic circuit boards. The ducts overhead provide ventilation.
A worker checks to see if a product is up to standard, using an electronic inspection screen.
The health care center in the EPZ is in fact a miniature hospital, with divisions of dentistry, ophthalmology, X-ray and others.
The health care center in the EPZ is in fact a miniature hospital, with divisions of dentistry, ophthalmology, X-ray and others.
The health care center in the EPZ is in fact a miniature hospital, with divisions of dentistry, ophthalmology, X-ray and others.
At noon break, the workers take lunch at the EPZ restaurant.
At noon break, the workers take lunch at the EPZ restaurant.
A vending counter in a corner of the restaurant sells daily commodities at a low price.
Women's dormitory at the NEPZ.
Women workers play the guitar and sing songs in their dormitory.
Mama Jung is in charge of the girls' room keys.
The library and study room in the dormitory.
After a day's work.
female workers can play basketball.
dragon ball or arrange flowers.
Others take the bus.
bicycle home.
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