In the past, you have been familiar about the IT (hardware) powerhouses referred to as Japan, Korea, Hong Kong and Taiwan.

It is going to change dramatically after China and Taiwan have started wooing each other since Kuomintang (KMT) party candidate, Ma Ying-jeon was sworn in as the President of Taiwan on May 20, 2008, Taiwan.  Since then China has thawed its frosted cross-strait dialog and opened up direct flight routes between China and Taiwan.

Chaiwan - China and Taiwan, the new IT powerhouse

In a recent news article in Reuter— the closer tie-ups between China and Taiwan, dubbed as “Chaiwan”, will alter the balance of power in IT which will benefit China as more Taiwanese IT companies will build technology and production facilities in the mainland.

On the other side, Taiwanese company will enjoy easier access to mainland China’s huge local consumer base. They enjoy competitive advantage and greater benefits in comparison to Korean or Japanese companies as Taiwan shares a common language and culture with China.

China and Taiwan are also negotiating trade pacts next year where Taiwanese companies could enjoy lower tariffs in return for a range of investments by the Chinese in Taiwan domestic market. Investors across the strait are elated with the turn of events, and have given their “thumbs up” for the thawing of relationship between the past two adversaries.

The author was Managing Director, Indian operations for BenQ India and held several senior positions at Acer Peripherals (a Taiwanese conglomerate). In his present role, he heads the Asia Pacific sales for Phonak Communications AG, a leader in hearing technology.