The Legitimacy and Effectiveness of Local Content Requirements: A Case of the Offshore Wind Power Industry in Taiwan

Abstract

This study begins with a background introduction to the development of the offshore wind power industry and the local content requirement policies in Taiwan. Subsequently, it discusses the conflict and exceptions between local content requirement (LCR) policies and World Trade Organization (WTO) rules, further to probe into the pros and cons discussed in the literature about LCR policies, with particular emphasis on the energy sector. In the conclusion and policy recommendations section, the author suggests that the effectiveness of LCR policies differs across countries, and that the Taiwanese government should find its own way on a trial-and-error basis. It should also be considered that the government could align the LCR policies with the WTO framework to avoid conflict by designing them more carefully.