The hosiery industry is a kind of traditional, labor-intensive and low value-added one. In the face of global competition, some Taiwan manufacturers decided to transfer capital to countries with lower wages and to build factories there to reduce costs and increase profit. However, most manufacturers remained in Taiwan.

It is not easy to form a symbiotic model such as Taiwan’s hosiery industry did. There is a similar cluster in Yiwu in Zhejiang Province in China, but without the same industrial division of labor as Taiwan, they have to produce the whole product, which causes competition and makes cooperation difficult.

Taking advantage of the cluster and geographic closeness, Taiwan hosiery industry manufacturers are not only learning from and offering support to each other, but also engaging in research and development and innovation, ongoing industrial restructuring, and the development of differentiated products. This has allowed the whole industry in Shetou, Tianjung and Yongjing to stand firm and to avoid a declining trend and hollowing out owing to the rise of China.