newsbytes@clarinet.com (02/04/90)
SYDNEY, AUSTRALIA, 1990 JAN 29 (NB) -- A change in legislation paves way for AUS$1B investment in the Australian information industry. Highly competitive Taiwanese firms are set to use their technological superiority to exploit weak spots in the field. Local concern follows the change in Australian legislation. The newly opened door to Taiwan investment has prompted many inquiries to the Australian Commerce and Industry Office in Taipei, according to the office spokesman Bill Mattingly. Despite a quiet passage through Federal Parliament in December, analysts predict the Foreign Corporation (Application of Laws) Act will result in investments worth more than $1 billion. Taiwan is renowned for its efficient manufacturing industry, with many major international firms using components produced by original equipment manufacturers (OEM) in Taiwan. The development is particularly crucial to Australia's computer manufacturers who are presently suffering from a softening economy and the high cost of components. "Australian firms have been hiding behind protective tariffs for too long. Hopefully some aggressive competition from the Taiwanese will encourage them to venture out from their domestic cocoon into the cold hard world of international competition," Mattingly said. However, Australia will also benefit by predicted joint ventures which will see the Taiwanese inject much- needed R&D funds into Australia. While Mattingly believes many of the Taiwanese investment dollars will go to setting up Australian research facilities, it is likely some manufacturing could also be transferred. "One international company in particular, which has failed to find an Australian company capable of producing certain high technology components, is negotiating with a Taiwanese firm to set up a facility of one of Australia's southern states," Mattingly said. He refused to name the companies involved. Mattingly believes that if Australian industry is prepared to learn by example, it will benefit from exposure to Taiwanese entrepreneurs. Taiwan is Australia's fifth largest trading party, with two-way trade running at $4 billion. (Emma Connors, Computing Australia/19900131)