From the beginning of the Chinese Year of the Tiger, a shortage of labor and materials in China has become a problem affecting most Taiwanese businessmen operating there. As China is transforming its economy from one driven by exports to one driven by domestic demand, and converting itself from a global factory to a global market, it will have a far-reaching impact on Taiwanese businessmen, as well as on the whole world. The rise of the Chinese market has compelled its producers to compete with Taiwanese businessmen for labor and materials, which has pushed up the prices of both. If the trend does not change, cheap made-in-China products will be gone and the so-called Chinese factor will no longer be the cornerstone for low global inflation. Instead, it will trigger worldwide price hikes to the detriment of the global economy, which is still reeling from the financial crisis. As if this alone was not bad enough for Taiwanese businessmen in China, they will also have to brace for a possible appreciation of the Chinese yuan in the second half of this year. What should they do? Should they relocate somewhere else like they fled to China from Taiwan two decades ago? If Taiwanese businessmen in China can upgrade their products, set up their own brands rather than manufacturing products for others and compete for Chinese domestic market, they might be able to survive the crisis. They could also relocate to Southeast Asian countries, which are forming a single trade bloc. Some predict that many of these Taiwanese businessmen will return to Taiwan, but the problem is whether Taiwan has prepared itself for this scenario. It has been reported that the Taiwanese authorities are mulling whether to set up a special zone to accommodate these businessmen, and we can only hope that it will be a well-conceived plan. (March 2, 2010) 