Taiwan is in the middle of an enormous national effort to promote its soft power, aiming both to improve and enrich society and at the same time stimulate growth in an era when it has lost many of the industries that drove the economy during the past 50 years as one of Asia’s original tigers.

Like the rest of Asia, Taiwan is seeking a new role as it faces the rising economic might of the mainland. Thousands of its factories have migrated there, along with tens of thousands of managers, engineers, accountants, architects, designers and other skilled people. In many products, it can no longer compete with the mainland.

Its competitive advantage appears to be in soft power. The government in Taipei has chosen culture and creativity, including books, films, music, dance, museums, performing arts, design, architecture and products made by individuals and not factories – tourism, leisure, environmental protection and the making of a moral, polite society.

In May 2012, the government set up the Ministry of Culture and appointed popular writer Lung Ying-tai, whose books have sold millions of copies in the Chinese world, to head it.

The ministry and cultural bureaus of cities across Taiwan provide grants and loans to such activities.

Its efforts are paying off, if we look at the number of tourists. Last year Taiwan attracted a record 10.44 million visitors, equal to 43 percent of the population of 23.5 million, and up 5.34 percent on 2014. This figure is over three times more than the 2.98 million visitors in 2002.

Attracting Hong Kong People

The number of visitors from Hong Kong has risen sharply over the last decade. Last year 164,275 came from Hong Kong and Macau, an increase of 16.06 percent over 2014.

Ask Hong Kong tourists why they come; they will tell you they love Taiwan’s fusion cuisine, green farming, exquisite pastries, gourmet coffee and boutique hotels.

According to a report by the World Trade and Tourism Council, spending on travel and tourism in 2014 in Taiwan was NT$334.5 billion, accounting for 2.1 percent of GDP, and forecast to rise by 1.8 percent when 2015 figures are tallied. It accounted for 676,500 jobs, 6.1 percent of total employment.

Another indication of Taiwan’s attraction is the rapid rise in the number of Hong Kong students going there. In 2015, the number was 7,333, compared to fewer than 1,000 in 2011. The number of Hong Kong migrants has also been rising in recent years.

In 2014, Taiwan approved 7,498 applications by Hong Kong people for residence permits, the highest in more than 20 years, according to statistics compiled by the National Immigration Agency. That compares with 3,908 in 2012 and 2,995 in 2011.

This new atmosphere was one reason why Raymond Yang, a Hong Kong photographer, and his wife Kia emigrated in 2012. They set up an artistic coffee shop, The Canopy, in Taipei near Taiwan National University. It is an elegant place, full of sunlight, with examples of Yang’s pictures on the wall.

“One of the reasons we emigrated was the larger space and better environment in Taiwan for cultural and artistic activities. We put on exhibitions in our coffee shop. The atmosphere is not so commercial. The Ministry of Culture and departments of culture in cities and counties are willing to sponsor individuals and groups to put on exhibitions, performances and other activities – not the full amount but hundreds of thousands of New Taiwan dollars. This is a national policy, an important benchmark, to support culture, films, performing arts and creativity.

In Hong Kong, on the other hand, he said, “the money is concentrated on big events with large companies. These become commercial events. It is hard for young people to receive money for their projects. Culture has become marginalized. The Hong Kong government prefers to leave this to the market.”

Another outsider attracted by Taiwan’s culture is Robin Ruizendaal, the Dutch director of the Taiyuan Puppet Theatre and the Lin Liu-hsin Puppet Theatre Museum in Taipei. They perform the traditional folk puppetry of the island. Ruizendaal moved there in 1993 and is one of the few foreigners who can speak fluent Mandarin and Taiwanese. His troupe has performed in 47 countries across the world, including the Victoria and Albert Museum and the Royal Festival Hall in London and the Casa Mila in Barcelona. It receives 25 percent of its funds from the government, which also sponsors its visits abroad.

In Quanzhou, he first saw Quanzhou puppet theatre, a close relative of the art in Taiwan. “I was totally amazed and overwhelmed by its beauty. I moved to Taiwan because it had preserved the original moral standards and traditions of China,” he said.

Components of Soft Power

A close look at Taiwan’s ‘soft power’ strategy reveals three major components: promotion of domestic literature and book-related activities, creative parks and quality tourism.

Taiwan’s belief in the power of books is reflected in the many museums devoted to writers. The largest is the National Taiwan Literature Museum in Tainan. Its director, Chen Yi-yuan, said that the love of reading among the public was one of the bases of the island’s soft power.

“The more you read, the more you think and reflect and the less depressed you are,” he said. “Reading helps people invent and design. It is the basis of films, cartoons and other media forms.”

The book strategy is also reflected in its annual six-day international book fair in February. The event this year, one of the most important in the Chinese world, attracted over 600 publishers from over 60 countries; it had 1,706 stalls, with 560,000 visitors from home and abroad, with more than 400 talks and other events.

Many came from the mainland to read titles they cannot buy at home. Mainlanders are an important market for Taiwan books. The fair was both an occasion for people to enjoy books from all over the world but also for publishers to meet those in the world of film, cartoons and other media and discuss joint projects.

“Taiwan has a free and diverse creative environment, with an abundant publishing industry that produces more than 40,000 books a year,” said President Ma Ying-jeou when he opened the event. “In terms of per capita, our publishing industry exceeds that of China. We hope that, through the Book Fair, even more people will enjoy the beauty of traditional (Chinese) characters.”

Among the exhibitors were the Taiwan Independent Bookshop Cultural Association, the Independent Publishing Alliance and the National Universities Publishers Association. They are evidence that, despite the commercial pressure and competition of major companies, independent bookshops and publishers continue to flourish.

Culture and Creative Districts

Another leg of the ‘soft power’ initiative is the establishment of Culture and Creative Districts, a concept copied to a certain extent by Chinese cities like Shenzhen and Guangzhou.

In Taipei, two new districts are good examples. A mix of culture and commercialism, both were built on two large government-owned factories in the city center that were no longer used.

One is the Songshan Culture and Creative Park, which opened in 2012 on the 66-hectare site of a cigarette factory which closed in 1998. The government spent 12 years on reconstruction with the raw materials and techniques that were used in the original building.

It has a “mission is to kindle creativity and innovation.” The government rents space at below market prices to designers, creators and artists to make and sell their products and hold exhibitions, film shootings, fashion shows, performances and seminars. It houses the Song Yan Creative Lab and Taiwan Design Museum. Its title is the “Creative Hub of Taipei.”

Chao Chuan-ling, manager of marketing, said: “now the Culture and Creative Park has already moved on from managing a large area of space and has done a great deal of work on fostering and nurturing new talent in culture and creativity.”

The other is the Huashan Creative Park. In 1999, the Association of Culture Environment Reform Taiwan, a non-profit NGO, was set up to oversee the restoration of the factory into a full-fledged arts center. Now called Huashan 1914, it is a place for music festivals, design exhibitions and other cultural events.

Both have become popular destinations for visitors, both local and foreign, to bring a commercial return for those working there.

Other creative districts

There are such districts in cities all over Taiwan. The southwest city of Tainan has the Lan Li Tuwen Creative Area, which opened in December last year. Tainan’s Cultural Bureau offered 15 official buildings in the city center for culture and creativity. They used to house the city prison, prosecutor, high court and apartments for those who worked in them. Since the opening, 21 enterprises have moved in.

“The bureau offered us empty spaces of about 35 square meters,” said Yang Hsin-rong, a founder of Mu Mu Wenchuang (Eye Creations), which sells handicrafts and other local items. “We had to pay to decorate and equip the places. In the two months since, the area has prospered. We have many visitors from south and north Taiwan, as well as from the mainland and Japan. As its fame grows, more will come. We support the government policy to sponsor culture and creativity. Each place has its own special characteristics which the local government can develop. As the oldest city in Taiwan, Tainan is especially well endowed with historical sites and cultural relics that have been well preserved. Damage from the recent earthquake was very limited.”

Buildings of the Japanese era have been turned into boutique hotels, restaurants, coffee houses, bookshops and department stores; each strives to be different to the others and offer customers something different. They sell individualized, not mass products.

Like everywhere in Taiwan, Tainan offers its own food delicacies – a major attraction for visitors.

The northeast city of Ilan had a 31-hectare paper-making factory, the largest in southeast Asia. It shut down and was slated to become a science and industrial zone. Then, in 2015, the city government decided instead to turn it into a culture and creative district.

Lin Chiu-fang is head of the city’s cultural bureau: “to set up such a district in an agricultural area will not only bring more visitors to boost the local tourist industry. It will give local people the chance to become in contact with new and avant-garde things, it will give them new energy and open their eyes to new perspectives.”

Diversify Tourism

Tourism is another way to sell the new, sophisticated face of Taiwan.

“The figure (of tourists coming) last year was good,” said Lin Mei-ling, serving at the Taiwan Tourism Bureau counter at Taoyuan international airport. “We should develop higher-quality tourism and not simply go for the largest number, as with group tours. We should have individualized tours for people who spend more.

The country, she said, is offering a wide range of tourism, “like bicycle tours – staying on a farm for free and working there to pay for your room and board: cultural tours of different museums -- some Japanese come for five days and go every day to the National Palace Museum (NPM). Taiwan must offer things that are different to the mainland, in tourism as in other products. We cannot rely only on mainland visitors. If their number is reduced, then more Japanese or Koreans come.”

The visitors come for many reasons, including cuisine, scenery, culture, mountain-climbing, water sports and gay parties. The annual Taipei Gay Pride Parade last October attracted 80,000 people from around the world.

The single most popular tourist attraction is the NPM, which opened in November 1965 to exhibit art treasures brought by the Nationalist government from the Forbidden City in Beijing. It attracts more than 5.4 million visitors a year. Last December it opened a Southern Branch in Chiayi, in the southwest of the island; costing NT$7.934 billion, this is a museum of Asian Art and Culture and will show pieces from all over Asia, not only China. It aims to attract one-two million visitors annually in its opening years.

The opening exhibitions included Buddhist art, Asian textiles, the art and culture of tea in Asia, a brief history of Chiayi, Islamic jades, Goryeo celadon from South Korea and Imari porcelain from Japan. There are audio guides in Mandarin, Hokkien, Hakka, English, Japanese, Korean, Thai, Burmese, Vietnamese and Indonesia for NT$100 each.

In total, Taiwan has more than 170 museums ranging from those dealing with politics and history, culture and folklore to the Museum of World Religions and ones on nougat and fishballs.

The lesson for Taiwan’s soft-power offensive is that is soft power generates jobs and economic growth. It can create a place where visitors want to come and Taiwan people want to live and work and not take their skills and money to another country. It is also a lesson for places like Hong Kong and the mainland that are searching for new sources of growth and lifting people’s standards of living at the same time.

Mark O’Neill is author of “The Miraculous Story of China’s Two Palace Museums,” published in traditional Chinese and English by Joint Publishing of Hong Kong. (The two versions are available from the company and large bookshops in Hong Kong)