Rifan Muazin
The government of Taiwan has received formal commendation for its aggressive 2025 technology policy agenda, a strategic pivot aimed at securing the island’s long-term competitiveness and technological leadership on the global stage. Central to this transformation is the "Ten Major AI Infrastructure Projects" initiative, alongside the introduction of the landmark AI Basic Act, which serves as the statutory foundation for responsible artificial intelligence development. These moves, coupled with a structured national investment in emerging technologies like quantum computing, signal Taiwan’s transition from a hardware-centric powerhouse to a holistic digital economy leader.
However, as Taiwan navigates this transition, industry experts and international committees emphasize that digital resilience must be treated as a core national imperative. This resilience is viewed not merely as a technical requirement but as a central pillar of national security, economic stability, and public trust. To translate these high-level ambitions into durable outcomes, the focus has shifted toward international collaboration and the necessity of robust public-private partnerships. By adopting risk-based regulatory approaches that prioritize actual security and privacy risks over rigid mandates, Taiwan aims to foster an environment where innovation and security coexist.
The Shift Toward Resilience-by-Design Digital Infrastructure
As digital technologies now underpin every facet of essential public services—ranging from social welfare administration and healthcare delivery to interbank settlements—the vulnerability of these systems has become a point of national concern. The current policy discourse advocates for a "resilience-by-design" approach. This philosophy mandates that continuity, recoverability, and adaptability be embedded as core principles from the initial design phase of any national digital infrastructure modernization project.
Historically, Taiwan has made significant strides in digitalization over the last decade. However, the increasing complexity of interconnected systems means that incremental upgrades are no longer sufficient to withstand extreme disruptions, such as large-scale cyber incidents or geopolitical shocks. Industry leaders suggest that true resilience requires moving beyond simple data backup mechanisms. While data backups ensure that information is not lost, they do not guarantee that core systems can remain operational during a crisis.
To address this, a cross-ministerial framework is being proposed to avoid fragmentation across government administration, financial services, and healthcare sectors. This model would be supported by dedicated budget allocations and a coordinated public-private partnership. Furthermore, the strategy includes the implementation of "stress scenarios" and regular operational exercises. By simulating realistic crises through joint drills and tabletop exercises, Taiwan can identify hidden dependencies and clarify decision-making authorities before a real-world emergency occurs.
Modernizing Privacy Frameworks and Global Alignment
A critical component of Taiwan’s digital evolution is the modernization of its privacy regulations. The Preparatory Office of the Personal Data Protection Commission (PDPC) has introduced draft amendments for 2026 regarding the Personal Data Protection Act (PDPA). While the intent to strengthen data security is clear, there is an ongoing debate regarding the rigidity of these mandates.
Current drafts have introduced quantitative thresholds—such as data volume or entity size—to define "high-risk" agencies. Critics argue that this approach may increase compliance costs without necessarily enhancing protection. Instead, there is a push to align Taiwan’s regulations with international standards like the European Union’s General Data Protection Regulation (GDPR). Key recommendations include:
- Defining Business Contact Information (BCI): Establishing a formal definition for professional contact details (names, titles, business emails) and excluding them from stringent personal data protections to facilitate smoother commercial operations.
- Risk-Based Breach Notifications: Shifting the obligation to notify authorities only when an incident poses a real risk of harm to an individual’s rights. This includes refining the 72-hour reporting window to commence only after a breach is reasonably confirmed with actionable detail.
- Technology Neutrality: Moving away from prescriptive technical requirements, such as specific password complexity rules, which can quickly become obsolete. Instead, the focus should be on outcome-based security measures like multi-factor authentication and encryption.
- Controller-Processor Accountability: Clearly distinguishing between Data Controllers (who decide the purpose of data use) and Data Processors (who handle data on behalf of others) to ensure primary accountability rests with the correct entity.
To ensure businesses can adapt to these changes, experts are calling for a minimum 12-month transition period following the promulgation of any new subsidiary regulations.
Harmonizing Cybersecurity and ICT Procurement
The 2025 amendment to the Cybersecurity Management Act (CSMA) and new regulations from the Ministry of Digital Affairs (MODA) represent a concerted effort to harden Taiwan’s information and communications technology (ICT) security. However, inconsistencies remain between the legal framework and the practical procurement templates used by the Public Construction Commission (PCC).
A significant point of friction is the use of broad country-of-origin (COO) restrictions. In a globalized economy characterized by software-defined hardware and distributed production, the manufacturing location of a device is often an unreliable indicator of its security risk. A product manufactured in one country may have its code controlled, updated, and managed from an entirely different jurisdiction.
The Ministry of Digital Affairs has advocated for a risk-based, entity-based approach—for example, banning specific "high-risk" brands rather than a blanket ban on all products from a specific country. Aligning procurement guidance with this nuanced framework is expected to reduce uncertainty for government agencies and better reflect the actual threat landscape of modern ICT products. Furthermore, the implementation of a 60-day public consultation period for law amendments is being championed as a "Good Regulatory Practice" (GRP) to ensure industry expertise is fully utilized.
The Quantum Frontier: Phase II National Strategy (2027-2031)
Quantum computing is approaching a "quantum advantage" inflection point, where quantum systems will begin to outperform classical computers in specific, high-value tasks. Recognizing this, Taiwan has launched its Phase II Five-Year National Quantum Strategy, spanning 2027 to 2031. This strategy builds on earlier investments in quantum hardware and high-performance computing research.
While hardware remains essential, the next phase of Taiwan’s strategy focuses heavily on the "quantum ecosystem." This includes software algorithms, application development, and quantum networking. Experts suggest that Taiwan’s strength in semiconductors provides a world-class foundation, but the true value of quantum computing will be realized through its application in priority domains like finance, logistics, and national defense.
A major component of this strategy is "quantum-safe" preparedness. As quantum computers grow more powerful, they pose a systemic risk to existing encryption standards. Taiwan is moving toward "crypto-agility," a state where digital systems can quickly migrate to new cryptographic standards as threats evolve. The government is encouraged to establish a cross-agency task force—involving digital affairs, finance, and national security authorities—to oversee this multi-year transformation. This migration is viewed not as a simple technical upgrade, but as a strategic transformation of Taiwan’s digital trust model.
AI Policy and Continued Public-Private Collaboration
The AI Basic Act stands as the centerpiece of Taiwan’s 2025 policy achievements. By providing a risk classification framework, the Act allows for a balanced approach to innovation and regulation. However, much of the practical implementation—including sector-specific guidelines and risk assessment tools—remains under deliberation.
The Ministry of Digital Affairs and the National Development Council continue to engage with technology providers to refine these guidelines. This collaboration is essential for ensuring that the "Reference Guidelines for the Use of Generative AI" remain relevant in a fast-moving technological environment. By fostering a transparent dialogue, Taiwan aims to promote responsible AI governance that can serve as a model for other democratic nations.
Timeline of Key Policy Milestones
- 2024: Initial drafting of the AI Basic Act and preliminary risk framework consultations.
- 2025: Official launch of the "Ten Major AI Infrastructure Projects" and passage of the AI Basic Act.
- 2026: Proposed implementation of updated Personal Data Protection Act (PDPA) enforcement rules.
- 2027: Commencement of the Phase II Five-Year National Quantum Strategy (2027-2031).
- 2030: Target for full "resilience-by-design" integration across all critical government and financial IT systems.
Broader Impact and Global Implications
Taiwan’s comprehensive approach to digital policy has significant implications for the global technology supply chain. As the world’s primary source of advanced semiconductors, Taiwan’s internal security and digital resilience are inextricably linked to global economic stability. By aligning its privacy and cybersecurity frameworks with international standards, Taiwan ensures that it remains a "trusted partner" for global tech giants and democratic allies.
The shift toward risk-based regulation and quantum-safe cryptography positions Taiwan as a forward-thinking leader in the "Second Quantum Revolution." If successful, the island will not only maintain its dominance in hardware manufacturing but also emerge as a sophisticated hub for secure, AI-driven digital services. The success of these initiatives will ultimately depend on the government’s ability to maintain the current momentum of public-private collaboration and its agility in responding to the rapid pace of technological change.
Ali Ikhwan
Raul Delapena Setiawan
