Cambodia may present safer base for Taiwanese businesses

Cambodia is a promising target for Taiwanese entrepreneurs seeking cheap labor without risking the social unrest that has surged through Vietnam, according to an economics professor in Taiwan cited in our Chinese-language sister paper China Times.

Riots have broken out in Vietnam against China's oil rig in disputed waters near the Paracel islands in the South China Sea, which are claimed by both countries. Vietnamese protesters have destroyed foreign-invested factories, including those operated by Taiwanese.

Cambodia is on its way to democracy and the country's institutions are gradually taking on rules and laws, said professor Hsu Song-ken of Tamkang University's Industrial Economics Department. On top of that, local wages are low, which is an advantage for Taiwanese businesses.

However, Lee Chun, a spokesman for the Taiwan-based Chung-Hua Institution for Economic Research (CIER), said Vietnam will most likely continue to draw investment despite the anti-China riots because of huge local demand.

Lee said that Taiwanese businesses will return to normal operations after the riots cool down, while China will seek a way to peacefully settle its dispute with Vietnam.

Vietnam has over 90 million young laborers in its workforce, according to Lee.

The factories of several Taiwanese motorcycle makers such as SYM and Kymco have been established in Vietnam not only because production costs are low, but also because they to cater to the local market.

"Southeast Asian nations resenting Chinese people is not a recent thing. They used to resent China in the past for various territorial disputes. And if production plants were moved to other countries, similar riots could still happen at some point," said Lee.

http://www.wantchinatimes.com/news-subclass-cnt.aspx?id=20140521000069&cid=1202