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The U.S. subsidiary of Formosa Plastics Corp (1301.TW) has agreed to pay $7.5 million and to cooperate with plaintiffs to settle an antitrust lawsuit alleging the company and others curbed the supply of a widely used chemical in a scheme to inflate prices. (Scarcella, August 16, 2023)

“When the government of Taiwan planned for the future of Taiwan several decades ago, it focused exclusively on industrially stimulating the economy. It has been promoting that kind of economic growth and development since the 1970s, making it appear as if industrial growth is the only factor to consider with regard to the country’s future. In the name of progress and economic revitalization, state-led industrialization walks hand in hand with private corporations. Together, they compete for the world’s largest petrochemical plants. The industrial development policy of Taiwan is one of the factors in the loss of Taiwan’s coastal wetlands, the subsiding of land from industrial water withdrawal and sand mining, and the increase of toxic air emissions, contaminated water, and toxic buildup of metals in soils (Wu and Wu 171–2). This “macroeconomy” policy ruins bioregions.” (Chang, 2023, p. 171)” 

The Taiwanese Formosa Plastics Corporation (FPC) is the tenth largest petrochemical company in the world. Focused primarily on the production of polyvinyl chloride (PCV) resins (Wu 2022), the FPC is the main subsidiary of the larger Formosa Plastics Group (FPG), a vertically integrated, global conglomerate that owns businesses in biotechnology, electronics, and logistics, among others (Wikipedia 2020). Formosa’s four main subsidiaries (all petrochemical companies) account for an estimated 10 percent of Taiwan’s gross domestic product (Wu 2022). The most important sites for production are Formosa plants in Yunlin County (Central Taiwan), Point Comfort (Texas), and Baton Rouge (Louisiana). Enabled by the shale gas boom discussed above, plants at all three sites are subject to ongoing expansions, including a proposed $200 million plant in Texas, and the $12 billion industrial complex in Louisiana. Formosa also operates a steel plant in Central Vietnam that is the focal point of much local and transnational activism.

Formosa’s current economic and cultural standing is deeply connected to Taiwan's history of industrialization. The Formosa Plastics Corporation and Group were founded by Wang Yung-ching and his brother Wang Yung-Tsai in Kaohsiung in 1954. Born under Japanese occupation, Wang Yung-ching made a living selling and delivering rice as a young boy, and later operated his own rice shop as a teenager. Eventually, Wang transitioned into the lumber business and benefited from market liberalization following the end of Japanese colonial rule (Lin 2016). However, since US military forces destroyed one of his mills during WWII, Wang received $800,000 from USAID, which he used as capital to found Formosa Plastics (Shah 2012). Until his death in 2008, Wang became one of Taiwan’s richest persons and remains widely known as the “god of management” (Huang 2008).

In Taiwan, conglomerates like the Formosa Plastics Group are called guanxiqiye (“related enterprises''), a colloquial term for tightly-controlled, family-owned businesses. According to anthropologist Ichiro Numazaki (1993), the expression emerged from 1970s business discourse and quickly became a self-identifying status symbol for many corporations (Numazaki 1993, 485). Numazaki argues that Chinese trading tradition (emphasizing partnerships) and Taiwan’s vexed relationship to Japan and China contributed to the rise of family-owned enterprises. Daughter Cher Wang has co-founded important businesses outside of the petrochemical sector, including consumer electronics company HTC. However, the Formosa family has also experienced a series of conflicts: in 1996, Wang Yung-Ching expelled his son Winston for extramarital affairs, who later became involved in ongoing efforts to disclose his father’s substantial tax evasion (Offshore Alert 2018). Today, the Formosa Group is in the process of transitioning key positions away from family members (Taipei Times 2021).

Formosa’s operations have further been shaped by Taiwanese politics and cross-strait relations with China. Considered a moderate liberalizer, Wang held close ties to Taiwan’s democratic party, but also continued to push for expansion in the Chinese mainland during his lifetime, often leading to conflicts between Taiwanese and Chinese administrations (Lin 2016, 81). In 1973, Wang’s plans to build a large petrochemical complex in Taiwan were halted by the authoritarian Kuomintang (KMT) government, but following the lifting of martial law in the mid-1980s, Formosa made a second attempt, suggesting to build the complex in the scenic Yilan County (Ho 2014). Rising concerns over petrochemical development and pollution, however, led to mass protests by local residents and fisher people, creating a landmark moment for Taiwan's larger democracy movement (Ho 2014). In face of this opposition, Wang arranged secret trips to mainland China, and later announced that the plant would be built on the island of Haitsang in Xiamen province. Yet, economic sanctions between China and Taiwan, combined with pressure by the nationalist KMT government, eventually led to construction of the vast petrochemical complex in the rural and impoverished Yunlin County in Central Taiwan (Lin 2016, 82).

Characterization of loss from Vietnam’s Ministry of Agriculture & Rural Development (2018) within the Evaluation report on 10-year implementation of the national policy for ‘agriculture-farmer-rural’ development [ not available for public view] 

• “ Aquaculture households have lost 503.2 million VND (21,665 USD) per household, then fishing households 231.3 million VND (9958 USD) per household, and coastal service households 102.0 million VND (4392 USD) per household. Note that both fishing and fish farming households lost similar por- tions of their total income, around 98 percent, even as fish farmers earn twice that of fishers on average. In a country where the average yearly income of rural households is 130 million VND or 5600 USD (MARD, 2018), losing an average of 11,000 USD per household is significant.” (Truong et al., 2021, p 8). 

Characterization of the compensation schemes adopted by Vietnam’s government:

• “According to a report by the Ministry of Finance in 2018, the government was able to provide direct cash compensation to those identified as being impacted across the four provinces. This is because of the settlement with Taiwan Formosa Plastics for 500 million USD. In addition to cash, the Vietnamese government gave over 19,000 tonnes of rice to impacted households in the months following the fish kill. The government also monitored the safety of the ocean environment. As the government switched from emergency relief to recovery support, more programmes were introduced including loan access, scholarships for students, health insurance, and livelihood training pro- grammes. The government also worked with the Fisheries Department and other relevant agencies to build environmental monitoring systems, provide consistent water testing, engage in food safety monitoring, and work towards ecological rehabilitation of aquatic stocks” (Truong et al., 2021, p 10). 

“Environmental disasters have a tendency to further increase work precarity, particularly in places that are highly dependent on eco- logical resources (Marschke et al., 2020). Livelihoods, as such, may need to transform rather than persist in the face of crises (Alexander, 2013).” (Truong, 2021, pg 3)

“ Vietnam has struggled with ineffective environmental regulatory programmes or insufficient enforcement capabilities to ensure adequate protection of the environment as Vietnam develops (Fortier, 2010). Environmental impact assessments (EIA), in general, are viewed as bureaucracy rather than as an important aspect of the development approval process (Wells-Dang et al., 2016).” (Truong, 2021, pg 4)

The narrative of the text highlights the following key points extrapolated from survey responses and interview participants:

• Impacts of the Formosa disaster on households vary by livelihood strategies, and were particularly amplified for poorer households, women, and households without diversified livelihood strategies. 

• Coping mechanisms of households primarily involved reducing household expenditures, accessing loans, adopting a new livelihood strategy, and expanding existing livelihood strategies. However, adoption rates of these coping mechanisms vary across households with livelihoods across the service, fishing, and fish farming enterprises. 

• Compensation, though cited to have ignited protests from parties not qualified for restitution, did offer substantial help to those who were able to receive compensation. Additionally, compensation delivery was delayed (between one to two years after the incident was reported), further escalating impacts across families without savings. 

• Economic recovery of household income 30 months after the Formosa incident indicates that the majority of households have recovered their livelihood activities. However, this does not take into account families who are no longer in the region (out migrated following the disaster prior to the inception of this study).

Authors of the publication have affiliations to the Hue University of Agriculture and Forestry and the School of International Development and Global Studies at the University of Ottawa, Canada. The funding for this study comes from the Vietnam National Foundation for Science and Technology Development.