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Taiwan: More Mainland Chinese Investment to Be Permitted

(Mar. 22, 2012) On March 19, 2012, Taiwan's Minister of Economic Affairs, Shih Yen-shiang, announced the government's intention to allow mainland Chinese investors to participate in 161 kinds of businesses. This plan, outlined by Shih at a legislative committee hearing, would be the third round of opening up of Taiwan's market to investment from the mainland and would represent a substantial extension of investment opportunities. Previous rounds occurred in 2010 and 2011. The proposal would permit the investment in 115 types of manufacturing companies, representing 97% of the manufacturing sector; 23 service industries, which is 51% of that sector; and 23 businesses involved in public infrastructure construction, 51% of those businesses. At present, mainland Chinese investment is permitted in only 42% of businesses in manufacturing and services and 24% in the infrastructure construction area. (Jeffrey Wu, Taiwan to Allow More Chinese Investment (Update), TAIWAN NEWS (Mar. 19, 2012).)

Speaking in February, Taiwan's Interior Minister, Lee Hong-yuan, gave one reason behind the widening of the areas of investment open to Chinese mainlanders. He stated that Chinese funds could be useful, given Taiwan's budget shortfall for funding infrastructure. (Taiwan Seeks Chinese Investment in Infrastructure, CBS MONEY WATCH (Feb. 2, 2012).)