Hardy Survivors in a Harsh Landscape
Taiwanese Businesses in South Africa
Uncowed by bandits and undefeated by an inclement economy, Taiwanese businessmen strive for success in a strange land, all the more eager to be good citizens in their adoptive country.
Taiwanese Businesses in South AfricaBy Alice Yang
From CommonWealth Magazine (vol. 394 )
On our visit with Hung Shao-shung, advisor to the Overseas Compatriot Affairs Commission and automobile parts dealer in Johannesburg, our path is slowed by three obstacles. First, we go through a checkpoint manned by two armed guards in red berets. Next, a swarthy guard, also armed, looks us over and waves us through. And finally, we pass the high voltage perimeter fence topped with barbed wire that surrounds his home, where the car darts quickly into the garage as soon as the automatic door is opened. Visitors are escorted straight to the living room to ensure their safety.
A Taiwanese fishing vessel is docked at the Cape Town harbor. Having just arrived yesterday, the captain greets a steady stream of visitors as the crew clears the rigging and repairs the fishing nets. At the nearby Empress of Heaven Temple, a Matsu icon hailing from Taiwan's Beigang wears green and red robes and a benevolent expression on her dark face, reassuring anxious Taiwanese far away from home. A worthy diplomat of sorts, Matsu elicits reverent genuflection from locals whenever she is brought out for processions.
In this land with a population of 43.99 million (twice that of Taiwan) and a territory of 1.22 million square kilometers (33 times Taiwan's size), Taiwanese have come from their sub-tropical island to build businesses and set down roots on the southern tip of the habitable world.
All the necessities and pursuits of life here are imprinted with the mark of Taiwanese businesses. Thrust up against South Africa's cartel-like enterprises and global giants from Europe and the US, some of them have reached the pinnacle of their industries.
"International brands chase after me, not the other way around," David Kan, CEO of Mustek Limited, boasts gleefully. Clad in a pink dress shirt, Kan is referring to such big boys as Hewlett-Packard and IBM.
Despite maintaining a lofty position at the top of the industry, Kan remains alert. Rising at 4:45 AM to exercise, he eats breakfast over Business Day (South Africa's leading financial newspaper). Arriving at the office at six o'clock, he gets to work right away calling vendors in Taiwan and China before meeting with staff to set targets for the next quarter. A large map of Africa hangs on the wall behind him, as if symbolizing the breadth of his ambition.
Most of these Taiwanese entrepreneurs arrived more than two decades ago, during the tail end of South Africa's apartheid years. The country came under economic pressure from the international community for the policy, so Taiwanese businesses stepped in with investments. Government assistance for facilities acquisitions and workers' salaries attracted a sizable group of immigrants from Taiwan, eager to try their hands at business in this vast land.
Hailing from all corners of the island, each of them has a story to tell – all of which would take quite some time to relate in full. One example is Vincent Lin, president of Top International. Once a national-caliber skier, Lin went to South Africa at his father's behest to study the feasibility of setting up a cement factory. Not long after, both his father and eight-year-old daughter were killed when their plane exploded over Mauritius while on their way to join him in South Africa. Left in a stupor by the tragic loss of flesh and blood, Lin decided after three years in the doldrums to set up the cement factory in South Africa in fulfillment of his father's wishes.
Expanding into the textile industry, Vincent Lin developed a tumor in his pectoral area just as business was going well. Even in his weakened state from the operation and chemotherapy, Lin pressed on, coming to work and attending events with his life in the balance – even doing charity work at Nanhua Temple (a local branch of Kaohsiung's Foguang Temple). Now Lin is finally out of the woods, his cancer a thing of the past.
Strangers in strange lands, Taiwanese business people invariably put the trademark Taiwanese diligence and resilience to work, making their mark with an unrelenting spirit.
With the shakeup of the South African political system in 1994, as the majority blacks took power, security and social stability plunged and whites began an exodus, the Taiwanese dug their heels in and continued to fight. "Adversity is a natural barrier; it leaves fewer competitors," relates one diplomat. "As the saying goes, 'there are no fish when the water's clear.' If everything is smooth sailing, it's hard to make money. Making money means taking risks," he adds, illustrating the guiding philosophy embraced to one degree or another by everyone who manages to adapt.
With public safety in a state of severe deterioration and robbery and muggings commonplace, they've decked out their factories and homes with such protective devices as infrared sensors and electric fences. And many of them never go anywhere without their gun at hand.
One time, David Shih, chairman of Africa Star Trading and executive director of the real estate firm Kilimanjaro Property, was at his Johannesburg home, copying a guide to personal security for Taiwanese expatriates prepared by the Republic of China's representative office, when four robbers burst in from both front and back doors, surrounding his wife and daughter. Alerted by the family dog, which immediately began barking frantically, Shih drew his handgun and began firing. When he had spent his ammunition, his wife, who had gotten free, covered him with the rifle she grabbed from upstairs.
"The robbers jumped over the wall one after another, like monkeys. Another five seconds and we would have been dead," recalls Shih. "That dog is our life saver, and for that we make fried rice especially for him every day."
"Don't ask if we've ever been robbed – ask how many times," is the refrain we heard repeatedly from the Taiwanese businesspeople we interviewed for this article.
Always vigilant, they nevertheless spend most of their time like any other entrepreneurs in other countries, plugging away looking for opportunities, establishing a niche, honing leadership skills, mapping out company strategy, and guiding their staff into the future.
Potent Intercontinental Triangle
These entrepreneurs take ample advantage of interpersonal relationships among ethnic Chinese. Automobile manufacturing thrives in South Africa, with production of Mercedes-Benz and BMW cars right there in the country. Gleaming new cars speed along the country's highways, even more trendy and imposing than those in Taiwan. This has led many Taiwanese to go into the auto parts and accessories business. Orient Collection Imports specializes in automobile climate control equipment. Company chairman Hung Shao-shung, an advisor to the Overseas Compatriot Affairs Commission, comes straight out and tells his visitors, "My advantage is my knowledge of Chinese, which helps me move faster than my Caucasian competitors."
Utilizing extensive connections in China and Taiwan, he purchases assorted parts from northern and southern Taiwan, including such high-end items as radiators and grilles, and lower-end items from China. Taiwanese mold makers are especially accommodating about making molds for new car models to ensure they get a leg up on market demand. "White people don't have that kind of channel available to them," relates Hung, who keeps his hair in a crew cut and drives a Japanese car.
As an information technology titan, David Kan's most potent weapon is his connections linking Taiwan, China and Africa. Kan personally oversees purchasing, based in Taiwan, to ensure his products' competitiveness on the South African market.
The Mustek Group (annual revenues of US$500 million) is South Africa's largest computer supplier. The company's Mecer brand of desktop computers commands more than a 60-percent share of the local market. In Nigeria, Mustek found a local partner, together claiming a 30 percent share of the PC market under the Zinox brand name.
The company's presence in Kenya is guided by Ms. Lin Hsueh-yu. Kenya was recently ravaged by rioting, resulting in over 1000 deaths, but not only did General Manager Lin keep the company running, it actually suffered zero reductions in sales, as customers moved up purchases in anticipation of shortages once things had settled down.
Color Blind Hiring
Taiwanese people have even established an enclave at the Cape of Good Hope, at the southernmost part of the world.
Not far from the Cape Town wharf, a black worker for Ocean Prince Marine Products stacks crate after crate of fish with a forklift into the super cold storage facility. Amidst the cold mist are a huge tuna and a squid the length of two men.
Ocean Prince began as a supplier of cargo for Taiwanese fishing vessels. Upon taking the reins from his father, Kaohsiung native Henry Yuan began dressing in a suit and tie and set about vertical and horizontal integration of the company in the fishing industry.
A plump man, Henry has a traditional Taiwanese character, straightforward and honest, coupled with an international perspective and fluency in English and Japanese picked up during graduate studies at the University of Southern California and undergraduate work in Japan. After purchasing and processing the day's catch, Ocean Prince sends it to the local market or ships it for export to such points as Japan, Spain or France. In less than a decade, Yuan helped make Ocean Prince one of South Africa's leading frozen seafood companies. "There's plenty of money to be made if you're willing to put in the hard work," he offers as he juggles a conversation with a local customer and our interview.
Situated just outside Johannesburg in Alrode, South Ocean Electric Wire Company (SOEW) takes even less for granted. Although the company is listed on the stock market and CEO Edward Pan is worth over NT$100 million, he is out to wrest personnel from competitors, merge companies, and strike while the iron is hot in hopes of ultimately making it into the ranks of South Africa's top three electric wire and cable companies (it currently ranks fourth overall).
Edward Pan's top executives are all South African. Regardless of their complexion, Pan lets them put their talents to the test at his company.
SOEW hired teachers to give middle school- and high school-level courses to raise employees' level of education. Most Taiwanese business people keep a low profile in South Africa and are reluctant to draw much attention to themselves. Yet living in a foreign land, they must establish lifeblood connections with local society. "When you're in a strange land, you have to do even more to give back," says the genteel Pan, gazing out over the South African, ROC, and company flags flying outside the facility.
Good Treatment Yields Loyalty
The key to the success of these Taiwanese businesses in South Africa is their employment and treatment of people – South Africans, Chinese, Taiwanese, and even Jews. Huang Ching-nan, at nearly seventy, is the CEO of a financial firm which he runs like a bank, with over US$100 million in holdings circulating each day by conservative estimates. Huang relies especially heavily on his Jewish staff to decide whom to give loans, collect from, and audit.
"They'll work their tails off for you as long as you respect them, and give them a fair salary and bonuses," Huang relates.
Compared to the high turnover rate and frequent career changes of the Taiwanese workforce, Taiwanese businesses in South Africa are pillars of stability. Locals like working for the larger Taiwanese companies and seem to enjoy their inviting Asian warmth.
Mustek's senior sales manager and top-level executives have grown together with the company for over a decade. Their stalwart commitment and experience is put into play both in developing new markets and retaining existing ones. "When you're good to them, you can't even chase them away with a stick," says David Kan, jocularly pointing to a senior market manager nearby.
South Africa has been beset in recent months by water cut-offs and an economic slowdown marked most drastically by the severe depreciation of the South African rand by 15 percent within just a month. The injection of such factors into the equation has cast the business environment in a cloud of uncertainty. Having witnessed one of the world's most tumultuous moments of change two decades ago (South Africa's transition to governance by the black majority), Taiwanese businesses are now being rattled by these developments. Nevertheless, they remain confident that once the clouds disperse, the time will again be ripe for expansion.
A land of unusual geography and fickle climate, Africa has fostered the evolution of many unique animals and plants. Here in this corner pocket of the world, Taiwanese entrepreneurs have honed similarly unique courage and wisdom that nourishes their roots and keeps them strong even under the harshest and most trying conditions.
Translated from the Chinese by David Toman
Chinese Version: 南非台商 險惡叢林創奇蹟