TWSE Market Insights

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As the global wave of artificial intelligence (AI) sweeps across the world, Taiwan must not only safeguard its semiconductor “silicon shield” but also transform this technological advantage into long-term economic momentum. The national-level plan, the “New Ten Major AI Construction Projects,” will be a key driving force. Taking stock of the goals of the New Ten Major AI Construction Projects, the most critical are to create more than NT$15 trillion in output value by 2040 and to provide 500,000 high-paying AI jobs. However, for this ambitious plan to succeed, beyond technological research and development, the most critical driving force lies in “market capital.”

Unfolding the policy framework of the New Ten Major AI Construction Projects, we can see that this plan encompasses integrated development across three main areas: digital infrastructure, key technologies, and smart applications. The National Development Council (hereinafter referred to as the “NDC”), which leads the arrangement of this plan, has previously stated that for AI to be adopted across all industries, a robust digital infrastructure must be established. This includes not only the deployment of sovereign AI and high-performance computing capabilities but also core pillars such as data governance, talent cultivation, and even guiding market capital to drive innovation.

Indeed, the development of AI requires a substantial infusion of capital. According to CB Insights, global capital continues to flow into the AI sector. In Q3 2025, the number of transactions exceeding US$100 million increased by 41.82% compared to the same period last year. As for the domestic situation, the National Development Fund, in collaboration with the Ministry of Digital Affairs, has been promoting AI startup programs. From the launch in late March to November this year, it has invested in three AI and digital economy-related companies, with a total investment of NT$61 million, leveraging approximately NT$230 million in private investment. Additionally, other projects have invested in 129 companies within the AI industry, with a total investment amount of NT$ 2.412 billion.

However, from a private sector perspective, there remains room for growth in the scale of capital investment in AI innovation in Taiwan. Jan, Fang-Guan, Executive Deputy Minister of the National Development Council, cited silicon photonics—one of the three key technologies in the New Ten Major AI Construction Projects—as an example. He stated, “Driven by TSMC, Taiwan's silicon photonics technology has achieved a globally leading position. However, when we accompanied the President to participate in the roundtable of the Silicon Photonics Industry Alliance, we found that one of the companies’ greatest concern is the availability of capital.”

“Compared to major foreign companies that often engage in mergers and acquisitions worth US$3 to US$5 billion, Taiwan’s silicon photonics businesses are mostly small- and medium-sized enterprises. While our technology is outstanding, entering mass production or competing with international giants requires support from capital markets. This is precisely why ‘Asia Innovation Capital’ will play a crucial role,” Jan, Fang-Guan added. In other words, Asia Innovation Capital will serve as strategic fuel for cutting-edge technologies, driving the next wave of economic momentum by mobilizing capital and boosting startup success rates.

As for how Asia Innovation Capital enables startups or companies with niche technologies that are still in the growth stage to go public and raise the capital needed for expansion more efficiently: Jan, Fang-Guan observed that the Taiwan Stock Exchange’s Taiwan Innovation Board has significantly loosened its regulations over the past two years. The relevant measures include shortening the centralized custody period (from two years to one year), exempting the three-year underwriter sponsorship requirement, and reducing the period for submitting certified public accountants’ internal control review reports from three fiscal years to one fiscal year, thereby helping shorten the time required for companies to go public.

In addition, Jan, Fang-Guan noted that the National Development Fund under the NDC and the market capital of the Taiwan Stock Exchange can complement each other to support more representative AI startups in securing the funding they need for growth. The National Development Fund first provides early-stage incubation support through the “Business Angel Investment Program.” Once companies reach a certain scale, Asia Innovation Capital’s guidance mechanism then takes over, helping them shift to the capital markets to access more resources. After the companies go public, the National Development Fund reinvests the profits, creating a positive cycle of capital.

As Asia Innovation Capital positions itself as the “NASDAQ of Asia,” its investment targets will also cross national borders, attracting top-tier innovative energy from around the globe. Jan, Fang-Guan explained that, in order to make Taiwan a hub for startup capital in Asia, the NDC’s investment policies have become more open and flexible. He stated, “The National Development Fund’s investments are not limited by the traditional location of company registration. As long as a foreign startup’s R&D team is in Taiwan, its main operating entity or main market is connected to Taiwan, and the fund can invest flexibly whether directly or through co-investment with partner VCs.”

This model of cross-border investment taking root in Taiwan is essentially “channeling water into the canal” and already has real-world examples. Jan, Fang-Guan gave an example: “In the past, Taiwan established the ‘Central and Eastern Europe Investment Fund’ to promote cooperation with Central and Eastern Europe, which specifically targets the region’s drone industry that possesses practical advantages for deployment.” That is to say, through the collaboration between NDC and Asia Innovation Capital, Taiwan can leverage its R&D advantages to further become a global capital hub and a center for technology integration.

The capital market not only attracts funds but also retains top global talent. Regarding the cultivation and recruitment of AI talent, Jan, Fang-Guan mentioned that the government adopts a dual-track approach of “education at the root” and “work-ready training.” The Ministry of Economic Affairs is promoting the “AI New Talent Program,” enabling graduates without an AI engineering background to become employable by enterprises after one year of training and hands-on practice. After consolidating the domestic talent base, attention will also turn to attracting international talent. The “Act for the Recruitment and Employment of Foreign Professionals” has been revised to recruit global talent.

The strategy of cultivating domestic talent and recruiting internationally also complements Asia Innovation Capital. When international AI companies or startups choose to list, invest, or establish a presence in Taiwan due to a favorable funding environment, they help local talent gain world-class practical experience. More importantly, the driving force of the capital market will enhance the salary competitiveness of AI positions, further attracting outstanding overseas talent to Taiwan or encouraging Taiwanese professionals abroad to return, thereby creating high-paying jobs in Taiwan with international competitiveness.

Looking back over the past decade, the number of startups in Taiwan has tripled. Finally, Jan, Fang-Guan emphasized that in the next phase, the NDC’s strategy will guide more companies in innovative sectors toward scaled-up growth. This goal not only aims to ensure the success of individual companies but also seeks to create a clustering effect among the “five trusted industries,” AI, semiconductors, security and surveillance, next-generation communications, etc., thereby building a technological innovation, the “magic mountain range that protects the nation,” and consolidating Taiwan’s strategic position in the global supply chain.