Semiconductor History | 前鎮, Kaohsiung — The Zone That Sold Cheap Labour and Bought a Chip Industry

On 3 December 1966 the Vice President of the Republic of China unveiled a monument on reclaimed land in Kaohsiung harbour, and the Governor of Taiwan Province pressed a button to start the machines.

The site was 中島, a peninsula dredged out of the port, and the thing being opened was 高雄加工出口區, the Kaohsiung Export Processing Zone.

Taiwan's own government describes it as the first export processing zone in the world, and the safer claim is the more interesting one anyway: it was the model that dozens of developing countries copied, promoted from 1971 by the UN Industrial Development Organization as the Taiwan experience.

The mechanism was administrative rather than technological.

Sixty-eight hectares of land leased and never sold, one window for every permit, and no duty on imported materials or machinery, aimed at four stated goals: export trade, foreign investment, new technology, and jobs.

It filled up faster than anyone planned. Within two years the zone was saturated and employing more than twenty thousand people, and the government was opening two more, at 楠梓 and 潭子.

The jobs were overwhelmingly held by women.

Within a decade about four in five of the zone's workers were women, most of them recruited out of farming villages across southern Taiwan, and Kaohsiung's own city government now describes them as the people who carried the export miracle.

What they assembled matters for what came later.

Consumer electronics parts, transistor radios, and eventually semiconductor packaging: foreign firms brought wafers into Taiwan and had them bonded and packaged here, which is how a generation of Taiwanese technicians first put their hands on a die.

That is the unglamorous half of the story that Hsinchu's founding myth tends to skip. The engineers who went to RCA in 1976 came from a country that had already been assembling chips for a decade.

The zone still operates. It was renamed 前鎮科技產業園區 at a joint ceremony on 28 March 2021, fifty-five years on, and the tenants now run to integrated circuits and displays rather than garments and shoes.

It is a working industrial estate on Kaohsiung harbour, not a museum, so what a visitor sees from the public road is gates, container traffic, and the port behind it.

Photo: Padai, CC BY-SA 4.0, via Wikimedia Commons (Kaohsiung harbour from above, with the processing zone in the middle distance and the Qijin peninsula beyond).

Photo: 中國農村復興聯合委員會, public domain, via Wikimedia Commons (a technician at a microscope, 1971 — this photograph is from the Tanzi zone near Taichung, not Kaohsiung, and shows the assembly work the zones were built for).