Investor Presentaiton

Limits Of The Current Strategy • Labor costs are now high relative to neighboring countries • Other domestic costs are rising • Taiwan is facing increasing pressure in export markets • Taiwanese companies are investing heavily in lower wage- locations in the region to maintain current strategies The proximity of China offers an easily available alternative location with access to a huge domestic market • Taiwanese exports are heavily dependent on a single cluster in which other Asian countries also compete - The U.S. downturn in IT investment has a large impact on Taiwan CAON Taiwan Presentation 07-31-01 CK 18 Copyright © 2001 Professor Michael E. Porter

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