Taiwanese manufacturers thrive in Juárez

Taiwanese manufacturers thrive in Juárez

By Louie Gilot / El Paso Times

03/02/2007

JUAREZ — There was a time when a lot of our electronics were stamped "Made in Taiwan." These days, a lot of them are still made by Taiwanese companies but may be stamped "Made in Mexico."

And more and more of them are being made in Juárez.

Wistron, formerly Acer, is one Taiwanese company thriving in Juárez and expanding from making computers to making flat-screen TVs.

"There’s more demand for consumer (electronic) products. We are sticking with the customers, and it looks like we have more chance to increase the services here," said Hank Hsu, general manager at the plant on Baudelio Pérez Mucharras street near the Zaragoza Bridge.

The 252,000-square-foot plant employs between 1,000 and 2,000 people and has been steadily expanding since 1998, when it operated as Acer. The plant handles large orders for the U.S. market and elsewhere, as well as single orders from people who order a customized computer through a Web site.

Hsu said he expected that he’d have to build another production facility in the compound by next year.

Acer was the first Taiwanese company to come to Juárez. Since then, many others have followed — Foxconn, Asus, Tatung, ECS, Elite, Enlight, Bizlink and Iventec, which arrived in January. Most plants make computers for Hewlett-Packard, Gateway and other large brands. Taiwanese officials estimated that Taiwanese plants employ 8,000 workers in Juárez.

Allan Chen, the president of the Taiwanese Chamber of Commerce of Juárez/El Paso, said the Taiwanese presence has doubled in the past five years. There may still be more Taiwanese companies in Tijuana, but the electronics manufacturers tend to come to Juárez.

One reason is Juárez’s central location on the U.S.-Mexico border and the fact that many of those companies, including Wistron, have service centers in Texas, usually around Dallas.

Chen is also the El Paso manager of Y.C. Cable, a supplier of China-made computer cables that caters to Juárez maquilas.

The industry is poised to grow, but the Taiwanese government feared that political complications could dwarf future Taiwanese economic activity.

During a visit to El Paso last month, Kenneth Liao, the director general of the Taipei Economic and Cultural Office in Houston, promoted a plan for a Taiwan-U.S. Free Trade Agreement and tried to coin the term Tufta, or Taiwan-U.S. Free Trade Agreement.

Liao explained that Taiwan has been "frozen out" of all the free-trade agreements among Asian nations, such as ASEAN. Liao said China pressures smaller countries to deny Taiwan participation.

"Taiwan risks being marginalized," Liao said. "With Tufta, the U.S. would send a powerful message. Tufta is our hope of preventing our nightmare of being marginalized."

The Taiwan situation is complicated. The island of Taiwan, off the coast of China, is viewed by China as a Chinese province and by Taiwan as an independent entity. Despite the dispute, Taiwan is the biggest investor in China, and many Taiwanese, like Chen’s company, own plants in China.

The U.S. does not recognize Taiwan diplomatically but trades heavily with the island.

In 2005, two-way trade between the United States and Taiwan was valued at $57 billion. Taiwan is the United States’ eighth-leading trading partner.

Texas exports to Taiwan were valued at $3.5 billion, or 15.9 percent of all U.S. exports to Taiwan, making Texas the second-biggest U.S. exporter to Taiwan.

Taiwan officials predicted that a free-trade agreement would increase Texas exports of telecommunications, petrochemicals, semi conductors, medical equipment, food and motor vehicles to Taiwan and to China by way of Taiwan.

The Texas Legislature passed a resolution supporting a free-trade agreement with Taiwan in 2005, but trade negotiations have seen little progress since the agreement was proposed in 2002.

In 2003, President Bush signed a free-trade agreement with Singapore and is now studying possible free-trade agreements with Ma lay sia and South Korea.

There are no Chinese plants in Juárez, but a New York-based group of Chinese investors started looking at the city last year.

The increased demand for flat-screen televisions will mean more business for Juárez because the cost of transporting the giant panels from China is prohibitive. Producing the new items also takes some adapting.

"It is challenging to us. Before, the product was much more simple. We had training here for our engineer and we sent people back to Taipei or China to learn," Wistron’s Hsu said.

"To us, challenge means opportunity."

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source: El Paso Times