page_title: Economic history of Taiwan
section_title: Contacts with Europe
hierarchical_section_title: Economic history of Taiwan / Contacts with Europe
caption_attribution_description: Deutsch: Flagge der VOC, Vereenigde Oostindische Compagnie, am Nachbau des Ostindienfahrers Amsterdam in AmsterdamNederlands: Vlag van de VOC aan de replica van het spiegelretourschip Amsterdam in Amsterdam.English: Flag of the VOC (Dutch East India Company) on the replica of the East Indiaman Amsterdam in Amsterdam.
context_page_description: The recordkeeping and development of the economic history of Taiwan started in the Age of Discovery. In the 17th century, the Europeans realized that Taiwan is located on the strategic cusp between the Far East and Southeast Asia. Two main European empires that competed to colonize it were the Dutch and Spanish Empires. Taiwan also became an intermediate destination for trade between Western European empires and East Asia states. The history of Taiwan as a colony of the Dutch Empire, Kingdom of Tungning, Qing China, and Empire of Japan between 1630 and 1945 was based heavily on economics.
  In the 1950s, the Republic of China government, retreated to Taiwan after losing the Chinese Civil War, carried out land reform policies such as the 375 Rent Reduction. In the 1960s, the agrarian economy was replaced with light industry as small and medium enterprises started to form. From 1966 to 1980, Taiwan's economy was gradually stabilized as the Ten Major Construction Projects laid a foundation in further economic developments. After the 1980s, the role of government in the economy gradually lessened as many government-owned corporations were privatized.
context_section_description: In the early 17th century, the Dutch East India Company originally only traded along the Pescadores. However, the Ming Dynasty claimed the archipelago to be part of its territory and drove out the Dutch. The Dutch were forced to retreat to the main island of Taiwan, then known as Formosa. They established a trading post in Tayoan (modern-day Tainan City).
  The Dutch recognized the significance of cane sugar as an export product and extensively developed the industry in the areas under their control. Dutch exports of sugar rose rapidly throughout their colonial tenure and had reached 1,300 tons by 1660, a tenfold increase from 1636.
  The main purpose of the occupation of Taiwan was to trade with mainland China, Japan, Korea, and Southeast Asia, attempting to monopolize on the trade in East Asia. The main Taiwanese resources that they exported were sugar, sika deerskin, deer meat, antlers, rattan, and rice. By 1658, the company exported sugar to Persia, Japan, and Jakarta and had about 35 trading posts in Asia. Tayoan gained 25.6% profit, ranked second out of all of the Dutch trading posts, after Nagasaki, Japan. However, the profit was distributed to shareholders of the company, and not the local Taiwanese.
  At the time, the Japanese were also interested in commercial activities in Taiwan. As a result of the economic challenge from the Japanese, the Dutch East India Company levied heavy taxes on the Japanese merchants. In 1628, the Japanese kidnapped governor Pieter Nuyts and closed down the trading post in Nagasaki. It was reopened again in 1632, after Nuyts was extradited to be jailed in Japan.
caption: Replica of an East Indiaman of the Dutch East India Company/United East India Company (VOC).
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