MOEA Overseas Distribution Channel Program Budget Increased to NT$600 Million with 2 New Subsidies

(CNA Taipei, July 1, 2024) The Ministry of Economic Affairs' International Trade Administration announced today that the budget for its program to assist manufacturers in establishing overseas distribution channels will be increased from NT$100 million to NT$600 million this year. Two new subsidy items, including distribution and agency cooperation and maintenance services, will be added to help businesses cope with global supply chain restructuring and tariff challenges.

The International Trade Administration held the "MOEA Program to Assist Manufacturers in Establishing Overseas Distribution Channels Results Conference" today. According to the Administration's statistics, 165 companies participated in the program last year, with 149 cases approved, a growth of about 4 times, indicating a significant increase in corporate participation. Companies have established a presence in 44 countries and over 2,500 overseas distribution points. Subsidized companies have seen an average export growth of over 25%. The main industries applying are machinery and equipment, consumer goods manufacturing, and metal manufacturing. Small and medium-sized enterprises account for about 75% of participants. The primary form of overseas distribution channel establishment is exhibition centers, accounting for over 70%.

William Liu, Director-General of the International Trade Administration, stated that corporate competition today is no longer just about reducing costs, but about how to be close to the market and provide timely services. Traditional industries such as machine tools, hand tools, and automotive parts need to establish local exhibition centers, distribution warehouses, or maintenance points to shorten delivery times and improve after-sales service efficiency. This is also the most apparent trend in current corporate overseas expansion.

William Liu further pointed out that in addition to the existing subsidies for overseas exhibition points, warehousing and logistics, and digital marketing, this year's subsidy items have added distribution and agency cooperation and maintenance services in response to the trend, hoping to help businesses establish a more comprehensive overseas service network.

William Liu noted that applications for this year's overseas distribution channel subsidies will be accepted until October 30. From late May to the present, 61 applications have been received. This program encourages cross-industry cooperation. If two or more companies apply jointly, the subsidy amount can reach up to NT$20 million. The subsidy limit for a single case applied by an individual company is NT$5 million.

Regarding industry sharing, Chen Jin-long, General Manager of industrial valve manufacturer Ching Tang Industrial Co., Ltd., stated that the company has long been established in the US and Canadian markets. In response to the cost and supply pressures brought by the US's tariff increases, with the support of the International Trade Administration's subsidies, in addition to the existing sites in Houston, USA, and Edmonton, Canada, a distribution warehouse and exhibition center were established in Vancouver, Canada this year.

Chen Jin-long pointed out that industrial valves are mainly used in the oil, natural gas, and commercial and civil markets, where customers have high demands for delivery times, thus requiring local inventory and immediate supply capabilities. By establishing the new Vancouver site, not only can delivery times be shortened and service efficiency be improved, but market share can also be expanded.

He also mentioned that the company continues to invite distributors to the exhibition center for product training, deepening their understanding of the brand and products. Recently, a customer who previously ordered about US$1 million per month saw their monthly orders increase to US$1.9 million, demonstrating that the overseas site expansion is gradually yielding results. (Editor: Chai Szu-chia) 1150701

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