Taiwan’s New Prosperity Is Exacting a Heavy Toll : Asia: Environmental pollution and unforeseen social strains are growing. It is more difficult to hire workers, especially those willing to do menial jobs.

One of the waiters thinks he looks like James Bond, and says as much. Tall, curly-haired and deeply tanned, Eddy Padiglione of Rome weaves into his lunchtime conversation the names of distant ports that he and his new love will visit--Malta, Monaco and the Greek islands.

“She will be a great beauty,” he purrs in a dark baritone. “She will sail fast and with great style.”

Padiglione isn’t referring to a woman, but to the sleek, 72-foot sailboat he will command when it is delivered next May by the Ta Shing boatyard here.

Its price tag--$1.5 million.

Taiwan once was regarded as a fountainhead of the cheap and tacky, like Japan just after World War II. Today, the Chinese island is a supplier to the rich and famous.

Along with their new prosperity, however, the Taiwanese are discovering some serious downsides, including environmental pollution and unforeseen social strains.

Taiwan has demonstrated how Confucian ideals like discipline, hierarchy and respect for order can nurture a powerful economy.

But cheap labor, the chief economic engine powering Taiwan’s boom, is disappearing. Manufacturers like the Ta Shing boat builders find it increasingly difficult to hire workers, especially those willing to do menial jobs for long hours and low pay.

Taiwan’s economy has grown at an average of more than 8% annually during the past four decades. Although smaller than West Virginia, Taiwan is the world’s 13th largest trading power. It is the sixth largest trading partner of the United States.

With $90 billion in foreign exchange reserves, Taiwan has the largest pool of cash on hand of any government except Japan’s.

Once poorer than their mainland Chinese relatives, the Taiwanese are now 30 times richer, with a per-capita income of $10,570 in 1993.

Taiwanese wear the latest European fashions and listen to American pop music. Many have graduate degrees from U.S. universities, live in ornate suburban houses and drive German or British luxury cars.

But Taiwan is one of the world’s most industrialized and densely populated places. With 10 million motorbikes and 3 million cars, it has 20 times the vehicle density of the United States.

Taiwan’s air is worse than that of Los Angeles. Less than 3% of its sewage is treated; its urban waterways are malodorous cesspools. Rates of disease, including asthma and cancer, have exploded, as have alcoholism and drug abuse.

The divorce rate has doubled since 1980, becoming the highest in Asia. Increasing numbers of Taiwanese are seeking psychiatric counseling for such maladies as panic attacks.

As fewer and fewer Taiwanese are willing to settle for the cheap wages and sweatshop conditions that produced the island’s economic miracle, manufacturers are turning elsewhere for labor--Southeast Asia and even mainland China.

Since 1992, Taiwan has become the single largest investor in Vietnam, with investments totaling about $1.5 billion, according to Taiwan government officials.

Since the late 1980s, an estimated 10,000 to 15,000 Taiwan companies have transferred $20 billion to the mainland through direct investments--although this trend began slowing in 1994 as many companies discovered difficulties in breaking into domestic Chinese markets.

Southeast Asia and China aren’t the only beneficiaries of Taiwanese capital. Taiwanese money managers make periodic forays outside the island in search of lucrative foreign investments.

Meanwhile, the government is taking steps to cope with the ill effects of rapid industrial development. It is encouraging, for example, a movement into less polluting, “knowledge-based” industries such as semiconductors.

In 1993, Taiwan was the world’s second-largest maker of notebook computers, with total production of 1.3 million units. Many of these were manufactured to fill orders from big U.S. and Japanese companies.

At the same time, some of Taiwan’s businesses, like the island’s small handful of yacht builders, are trying to forge reputations as caterers to the wealthy.

Ta Shing enjoyed a heyday as a discount boat builder in the mid-1980s, capitalizing on Taiwan’s then cheap labor.

But as Taiwan’s economy continued powering up and labor became steadily more expensive, Ta Shing was increasingly hard-pressed to compete against U.S. and European manufacturers.

This trend has led Taiwan’s boat builders to produce larger but fewer vessels. Ta Shing built only 15 boats in 1993, down from a high of 80 in 1984. The yard now employs 70 workers, a loss of 20 since 1993.

The company is staking much of its future on two new models. One is a line of powerboats. The other is the Dynasty sailboat line--the first of which will be commanded by Eddy Padiglione, a professional mariner. The Dynasty’s owner will be Sergio Di Lazzaro, who operates a fleet of charter boats in Italy, Greece, Malta and Turkey.

“Her name will be ‘Chenon,’ ” Lazzaro said, raising his glass with Padiglione and his other luncheon companions: “Chinese for ‘Romantic Dream.’ ”