Taiwanese President Lai Ching-te made his pitch to small and medium-sized enterprises in Changhua, pledging that the government will spend heavily to help with digital and AI transformation — a positive signal for owners of traditional industry firms.

• The government plans to invest NT$100 billion over four years, or NT$25 billion annually, to help small, medium and micro enterprises carry out digital transformation and adopt AI.
• Three major directions for the economy going forward: smart and sustainable development; emerging industries such as low Earth orbit satellites; and being rooted in Taiwan while expanding globally.
• The reciprocal tariff agreement signed with the United States last year brought Taiwan's tariff rate down to 15%, the same as Japan and South Korea, so traditional industries exporting to the US are no longer at a disadvantage.
• Countries are promoting "non-red supply chains" to guard against low-price dumping from China, and Taiwan is seen as a trustworthy partner, allowing it to capture orders on the back of that shift.
• Taiwan rose to 4th place globally in this year's IMD World Competitiveness Ranking, its best result ever.

Outlook: The government will next focus its subsidies on emerging industries such as drones and low Earth orbit satellites, while continuing to push traditional industries to join AI supply chains.