A GROWING number of Taiwanese online firms are choosing Singapore as their base to expand into South-east Asia as Taiwan and its regional rivals compete to snap up talent and become a tech hub.
While some say they will be setting up shop in Singapore within this year, many have already gained a presence in the Republic, Malaysia and Indonesia as early as 2015.
This predates the Taiwanese government's recent push to expand its trade and investment links with South-east Asia and reduce its reliance on China — a key policy by President Tsai Ing-wen during her presidential campaign.
Taiwan's biggest start-up accelerator, AppWorks Ventures, said at least 10% of the 305 start-ups it has helped to nurture since 2011 have ventured into Asean.
Among them are TV drama streaming app Choco TV and restaurant reservations app Eztable, which launched their services to the region in 2015.
Choco TV's founder and chief executive, David Yu, told The Straits Times that setting up in Singapore was "common sense", given the Singapore government's generous financial package, including subsidies and rental rebates, and also the Republic's high penetration rate.
"There is a good test market for any type of new Internet services and a reliable infrastructure for us to expand into the region from," Yu said, adding that ChocoTV has some 200,000 monthly active users in Singapore, the same number in Indonesia, Malaysia and the Philippines combined.
According to PayPal's Ipsos Cross-Border research report, more than a third of Singaporeans expect to spend more online this year, with mobile shopping spend likely to increase by 42% to more than S$1.2bil (RM3.77bil). Cross-border online shopping in Singapore is also forecast to grow by 23% this year.
Singapore's neighbouring Asean countries are also getting their fair share of attention as tech companies go on a "sales offensive" to grab a slice of the region's growing e-commerce market.
According to a report by Temasek Holdings and Google, South-east Asia's e-commerce market hit US$5.5bil in 2015 and is expected to grow by about 90% annually to US$88bil as early as 2025.
In comparison, Taiwan's e-commerce market exceeded U$34bil in market size in 2015 and is expected to grow by 10-20% annually in the next five years, according to a Nielsen report.
Data by online news site Tech in Asia show that tech investments in the region hit US$799mil in the first half of last year, a 69.3% spike from US$472mil in the same period a year earlier.
The Taiwan government declared its New Southbound Policy "operational" last November and is helping Taiwanese firms ink trade deals with their counterparts in 18 countries or states in South-east Asia, India, Australia and New Zealand.
But Eztable founder Alex Chen decided to do it on his own earlier to gain a "first-mover advantage" and secure a dominant foothold.
"We had the resources and had the contacts, so we felt we didn't have to wait for the government to help us out or tell us what to do," said Chen, 35, who is looking to extend the regional footprint to the Philippines later this year.
Even as local firms expand elsewhere, they will also help Taiwan in its efforts to attract budding tech talent from the region to its fledgling "Asian Silicon Valley" in a bid to be a hub for tech start-ups, say Taiwan's technopreneurs.
AppWorks founder Jamie Lin, also chairman of the Taiwan Internet and E-Commerce Association, said, "Tech firms know that we still have the biggest e-commerce market in the region and one of the best brains here. We are seeing a lot more interest in Taiwan and many firms are coming here to do research and development and test their products."
Indeed, Taiwan was recently ranked 10th in innovation and has one of the world's largest population of software and hardware engineers, who produce parts for gadgets and equipment by global brands such as Apple, Microsoft and electric carmaker Tesla.
Cosmetics and beauty products e-commerce platform Shopping99's chief marketing manager Sharon Peng said, "Even as we expand, we know that we have the best people here to produce our best work and make breakthroughs." — The Singapore Straits Times/ANN
Already a subscriber? Log in
Get 20% OFF The Star Digital Access
Cancel anytime. Ad-free. Unlimited access with perks.
