by
N. Peter Kramer
It will do so by raising the contribution of liquid natural gas (LNG) to 50 percent, cutting coal’s contribution to 30 percent and promoting the use of renewables such as solar, wind and hydropower. They should eventually make up 20 percent of the energy mix, compared with 5 percent currently.
Taiwan, lacking energy resources, depends heavily on imports to meet more than 95 percent of its energy demand, with coal approximately 45 percent and LNG 32 percent at the moment. The increase of the LNG share to 50 percent demands the construction of more LNG terminals. This new energy mix also requires the rapid and massive development of solar, wind and hydropower resources. The government has provided the private sector with strong incentives to develop renewable energy sources.
The move to a new energy policy did not fall from the sky. With the change of government in 2016, the new President, Ms Tsai Ing-Wen, kept her campaign promise for a nuclear phase-out, as per the German model initiated by Bundeskanzler Angela Merkel. Ms. Tsai’s decision shows not only a sense of responsibility for global climate protection but it can also be considered as a stimulus for the Taiwanese off-shore and energy industries, as wind power generation at offshore facilities seems especially promising.
Seeing its business potential, several major international players in the off-shore wind sector have already decided to invest billions of dollars in developing off-shore wind farm in Taiwan. Investors from the EU are especially active, as they have the experience and the know-how in this sector. Well-known names include the Danish companies Ørsted (the former Dong Energy) and CIP, and German WPD. Moreover, EPCI service providers DEME-GeoSea (Belgium), Jan De Nul (Belgium) and Semco Maritime (Denmark).
Wind turbine manufacturer Enercon (Germany) and underwater foundation manufacturer Bladt Industries (Denmark) are also considering to increasing their investment in Taiwan. Some of the investors expressed their concern that the amount of investments in offshore wind power are quite large. The lacking of an investment protection treaty between Taiwan and the EU will expose them at a high risk if investment disputes happen. They hope that a Bilateral Investment Agreement can be signed as soon as possible between Taiwan and the EU.
Taiwan is a ready partner for a Bilateral Investment Agreement with the EU
In 2017 the EU invested USD 3.3 billion in Taiwan. 56 percent came from The Netherlands, which makes this country the biggest investor in Taiwan. The UK came in a second place with 33 percent of the total amount. Now Taiwan is looking for a Bilateral Investment Agreement with the EU. It could benefit EU investors and stimulate Taiwanese investors ‘to go Europe’. In its latest report, the US Business Environment Risk Intelligence (BERI) company ranked Taiwan third best place in the world in which to invest, and second in Asia.
Confronted with the rapid rise of economic powers in Asia, the EU has begun negotiating economic agreements containing services liberalisation provisions with trading partners such as Mainland China, India, Japan, Korea, ASEAN and others, with the exception of Taiwan.
In its 2017 report on the implementation of the Trade for All strategy, the European Commission indicated that the EU is preparing to launch investment negotiations with Taiwan. Taiwan and the EU have established a working group on investment under their annual consultation mechanism. The working group held three meetings in 2017 for both sides to exchange views on each other’s investment regime.
It is envisaged that more discussions will take place in 2018. Taiwan is ready to launch investment negotiations with the EU. It is time for the EU to move forward and start its impact assessment, which is required before the European Commission seeks a negotiating mandate.
