Feeding Taiwan’s Transition to the Carbon Economy: Polyethylene and the Transformation of Taiwan’s Agricultural and Industrial Ecosystem, 1965–78

Before 1968, the capacity of Taiwan’s petrochemical industry was miniscule. In these years the plastic industry was largely limited to the production of PVC and acrylic, and used non-petroleum based raw materials or imported petrochemical derivatives. The establishment of the First Naphtha Cracking Plant in 1968 radically transformed the manufacturing processes of commonly used plastic resins. This paper explores the role of USI Far East Chemical Corporation in promoting the production and use of polyethylene by drawing on the Li Kuo-ting papers and USI Newsletters. Founded in 1965, USI Corporation, a subsidiary of National Distillers and Chemical Company (NDCC), became the first Foreign Direct Investment by an American multi-national firm in Taiwan’s petrochemical sector. The government in Taiwan was reluctant to support the establishment of a polyethylene plant due to its low profit margins but NDCC’s local agents successfully convinced economic planners that the economic benefits outweighed the risks. The use of polyethylene products in agriculture boosted food production, which in turn stimulated the use of plastic packaging in food products and led to the introduction of new injection and blow molding techniques. The domestic production of polyethylene opened up new developmental pathways for Taiwan’s agricultural and industrial sectors. The formative years of USI Corp. also offer insights on how economic planners and local businesses adapted foreign technology to address economic and political needs.