Economy

Japan began Taiwan's industrial development after gaining the island in the Sino-Japanese War of 1894–95. Since the early 1950's, under Chinese Nationalist control, Taiwan has developed a strong, diversified economy, based on manufacturing and services. Taiwan is one of the leading exporters of manufactured products in Asia. United States aid, large-scale foreign investment, and an abundant, well-educated labor force have played major roles in the island's rapid industrialization. Leading industries produce chemical and petroleum products, metal goods, machinery, electrical and electronic equipment, automobiles, textiles, clothing, and processed foods.

Despite a decline in relative value, agriculture remains a vital sector of the economy. Farming is limited mainly to the western lowlands, where virtually all available land is devoted to crops. Most farms are small, averaging about three acres (1.2 hectares) each. The mild climate and extensive use of irrigation permit the growing of two or three crops a year. Rice, sugarcane, sweet potatoes, cassava, corn, peanuts, citrus fruit, bananas, and pineapples are among the main crops. Pork, fowl, and fish are the chief protein foods. Most of the fish are caught in coastal waters and in inland ponds.

Taiwan produces timber and a number of minerals, including coal and natural gas. but meets most of its wood and mineral needs through imports.

The railway and highway systems, begun by the Japanese in the decades before World War II, are among the best in Asia. The chief seaports are Kaohsiung and Chilung. There are international airports near Taipei and Kaohsiung.

Foreign trade has grown enormously since the 1950's. Among the main exports are clothing and textiles, television sets and other electronic consumer products, machinery, transportation equipment, plastic items, and toys. Most of the trade is with the United States and Japan.