Focal Point of the Infrastructure Program

In line with the trend of green traffic and the increasing need for rail transportation in Taiwan, the Infrastructure Program features a focus on the establishment of the national railway network including the full-scale planning of the railway structure, city lines and metropolitan railway establishment. The plan, aimed for the 5 major objectives (TRA-THSR Network Integration, TRA Upgrade and Eastern Line Improvements, Railway Grade Separation and Commute Speed Upgrade, City Trail/MRT Promotion and South-Central Sightseeing Railway), targets to promote 38 rail infrastructures. The Legislature has initially passed a budget of NT$17b for the rail projects in the next 16 months (the first stage of the 4-year plan, extendable for another 4 years with further approval).

Since the rail infrastructure covers high-speed rail, conventional railway, MRT and light rail transit etc., it requires a wide range of technologies including those which cannot be accomplished by domestic vendors alone. Hence, the need for international businesses’ active participation arose.

Inroads for International Bidders – Solo or Team-up

With respect to construction for railway projects, many of the Taiwan companies are capable of contracting for construction such as stations, tunnel, highway, water and electricity or escalator facilities etc. and have extensive experience in these areas. We can already foresee the fierce competition between domestic companies in bidding for these projects.

As for signal engineering, transportation planning, control systems, communication systems, electric power supply system and EMU that require certain technologies and patent rights, however, international firms are in competitive positions to win the bids. For example, Taipei MRT EMU are separately contracted to bidders such as Alstom, Siemens, Kawasaki Heavy Industries and Bombardier etc.

Based on Taiwan’s past experiences in rail infrastructure, both turnkey and consignment have been used. Since the qualification of the companies for bidding turnkey on rail infrastructure have been heavily regulated, it is likely that collaboration between domestic and foreign companies would be necessary. Opportunities are open for foreign companies to participate in the projects this time around as well.

Furthermore, under Taiwan’s GPA commitments, most procurement projects exceeding certain amount must be open for foreign contractors. For example, constructions over NT$250 million and services projects of the central government over NT$6.52 million must be open to foreign bidders.

Track Record of Foreign Vendors in Taiwan Rail Infrastructure within the Last 5 Years

From the recent projects (e.g., Taipei MRT lines and Taoyuan Airport Express Line), we see prominent multinationals such as Siemens, BES, Ansaldo, Hitachi, Bombardier, KSECO, Marubeni, Pteris, etc., who successfully won the bids and undertake the projects. They also team up with Taiwanese firm such as RSEA.