Taiwan ranked fourth globally for venture capital investment

November 8, 2004

In its 2004 World Competitiveness Yearbook, the International Institute for Management Development (IMD) in Switzerland ranked Taiwan fourth in the world and second in Asia for venture capital investment.

Venture capital investment has expanded steadily along with the rapid development of knowledge economies over the last twenty years. While the bursting of the Internet economy bubble and the global economic slowdown led to a significant shrinkage in the volume of venture capital investment, this volume began to gradually return to a period of growth in 2002.

Taiwan achieved a rating of 6.76 for venture capital investment in IMD's competitiveness yearbook, putting it in fourth place globally behind the United States (7.95), Hongkong (7.06) and Finland (6.8). The average world rating was 4.72. As you can see, in Asia, Taiwan is led only by Hongkong when it comes to venture capital investments.

A total of 241 venture capital enterprises have opened in Taiwan as of 2003. These firms have invested a total of NTD 161.9 billion across 8,719 investment projects. In 2003 alone, venture capital investments totaled NTD 16.54 billion. This investment was equivalent to 0.17% of Taiwan's gross domestic product, a three-year high for this ratio.

The amount of venture capital Taiwan invests in biotechnology and software development still lags behind that put into information technology and electronics manufacturing, which attract the vast majority of Taiwan's venture capital investment.

In 2003, 23.1% of Taiwan's venture capital was invested in the semiconductor industry, 16.8% in optoelectronics, 13.5% in electronics, 12.5% in information technology and 9.5% in telecommunications. These figures are hardly surprising and demonstrate just how important information technology related industries are to Taiwan's economy. Taiwan's Council for Economic Planning and Development points out that biotechnology and software development are the most active sectors globally for venture capital investment and says that these two sectors will play a vital role in Taiwan's future economic development.

(Central News Agency)

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