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Can Taiwan's Economic Miracle Persevere?

4) Small and medium enterprise structure-this structure was the main backbone of the miracle but its formation and functions were more the result of private sector efforts rather than government policy, which accidentally sowed the seed through the land reform program in the '50s.
5) Land reform program-it forced the native elite landowners to engage in business activities and became the main driving force of the economic machine later, but purely as an accidental consequence which I will explain.
6) High tech upgrades-when the economy hit the bottleneck in late '80s, early 90's, some low-tech downstream items were developed in the computer industry but were mainly due to the business sector's own ventures rather than policy-induced as claimed. The jury is still out as to how this area will eventually work out.

The Real Reasons-The External Forces
1) Japanese Heritage-over fifty years of its occupation Japan constructed an excellent network of transportation and communication facilities, a population 90% literate and extremely law-abiding, and all the other infrastructure needed as its forward base for its WWII efforts. Taiwan was more advanced than any Asian country except Japan.
2) Mainlander's Contributions-two million Chinese followed Chian Kai-Shek to Taiwan, many of whom were intellectuals and professionals who became the movers and shakers in many sectors.
3) The Korean War-the war was a real savior for Taiwan as it reversed U.S. policy on Taiwan from one of abandoning Chiang's regime as not worthy of support to one of the most staunch ally. The Seventh Fleet was dispatched to defend Taiwan. Taiwan was regarded as an "unsinkable aircraft-carrier" and military and economic aid started to flow in. The economy got a big boost from the war effort.
4) The Vietnam War-Taiwan was used as a supply depot to support the war effort and as a recreational center for military personnel. Again a shot in the arm to finance the economic development. Statistics showed a total of more than $150 billion of U.S. aid was dispensed to Taiwan from 1951 to 1969 for these two conflicts in Asia.


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