Taiwan is a country that went from poverty to prosperity from 1940 to 1980 (Taiwan, unknown). It started at the end of World War II the railways, harbors and roads were only operating at half time leaving them with a short supply of basic goods while prices continued to skyrocket (Taiwan, unknown) . By 1949 the wholesale price index increased 5,599 times and the mainland fell to communism which caused an even greater shortage of supplies and materials (Taiwan, unknown).
While Taiwan was down, the United States stopped providing financial assistance which put more stress on the economy (Taiwan, unknown). Taiwan needed to recovery and develop its agricultural sector to survive (Taiwan, unknown). Taiwan used its agricultural achievements for industrial development (Taiwan, unknown). As the Korea war broke out the US resumed its aid which helped stabilize the economy. By 1961 there were protectionist measures in place and there were more agricultural products being exported than industrial products (Taiwan, unknown).
Japan was Taiwans largest export market and the US was its major supplier of imports. Things changed by 1962, and Taiwan became more of an industrial based economy but it came with many socioeconomic problems (Taiwan, unknown). The major issue at hand was the employment of labor no longer needed in rural areas because of the increase in foreign trade (Taiwan, unknown). So the government encouraged the development of labor-intensive export industries and foreign investments started coming in due to the inexpensive labor (Taiwan, unknown).
By 1973 the first energy crisis took place. It caused a recession and increased inflation worldwide (Taiwan, unknown). And in 1979 the second energy crisis took place (Taiwan, unknown). Commodity prices soared and there was a shortage of food and raw materials (Taiwan, unknown). So the government came up with the Twelve Major Construction Projects which laid the foundation for heavy chemical industries and helped the energy crisis (Taiwan, unknown).
To promote more trade the government lifted trade restrictions, lowered tariffs and set up a unitary exchange rate which led to the most rapid growth in the history at a 10% growth rate for 18 years (Taiwan, unknown). Beginning with 1982 drastic economic as well as social and political changes took place(Taiwan, unknown) . The government announced plans to liberalize and globalize the economy as well as privatize the government (Taiwan, unknown). Tariffs were slashed, interest rate controls were done and the central exchange rate was stopped(Taiwan, unknown) .
After this was done, the foreign-exchange reserves reached the US$70 billion mark (Taiwan, unknown). This led to the replacement of labor intensive industries being replaced by technology and capital intensive industries(Taiwan, unknown) . This changed Taiwan’s industrial structure (Taiwan, unknown). By 1987 many businesses moved overseas due to the political uproar caused by the Emergency Decree being lifted, myriad of social movements erupted and environmental protectionists, consumers and farmers voiced their needs (Taiwan, unknown).
But this was also the first year that Taiwan and Chinese mainland started to have contact with each others and they started investing business on each land which decreased Taiwan’s dependence on the US(Taiwan, unknown) . Taiwan went from rags to riches by enhancing its economic growth, creating favorable domestic conditions, creating social stability and harmony, creating a solid educational foundation, savings habits, strategic economic planning, and a responsible government (Taiwan, unknown).
This didn’t happen overnight but Taiwan set record history like no other country in the world with an average annual economic growth rate of 8. 63% (Taiwan, unknown). Taiwan learned from their mistakes and makes a great example for other developing countries. Everyone falls but those that stand right up and make changes for the better are the ones that succeed. Ethical practices.. Are they being followed? Essentially, the answer is no. Corporate responsibility is still relatively new in Taiwan (Hsueh, 2007).
There are still many pollution concerns and corporations are still being accused of polluting soil, water and air (Hsueh, 2007). It does however appear that the government is taking action on this (Hsueh, 2007). There are also still some issues with labor laws. Laws do exist for abuse and discrimination, however, migrant workers are not fully protected (Hsueh, 2007). When it comes to workplace fairness, Taiwan workers do have the option to have a collective bargaining unit yet no unions exist in the technology sector (Hsueh, 2007).