Print

Mail

wiki links

Local plans may smooth FPG moves

The Formosa Plastics Group (台塑企業集團) may see approval of proposed investments in China smoothed over due to plans to increase its investments at home, a business executive said yesterday.

"There is a direct relationship between a firm's domestic investment and the willingness of the government to approve investments in China," a senior executive from the Formosa Plastics Corp (台塑), who requested anonymity, said.

"If we stopped investing in Taiwan, the government might not approve our plans to invest in China," he said.

Officials from the Investment Commission and the Mainland Affairs Council refused to comment on the correlation between domestic investment and approval of investment projects in China.

The Formosa Group plans to sink an additional NT$19.1 billion into facilities at the nearly completed Sixth Naphtha Cracker Project in Mailiao Yunlin County, and an additional NT$15.1 billion on additional cogenerating power units at the complex, he said.

The complex itself cost around NT$400 billion to build, according to data provided by the Formosa Group (台塑集團).

These increases may help pave the way for approval of Formosa Plastic Corp's (台塑) plan to invest around US$127 million in a PVC factory in the port city of Ninbo, Fujian Province.

Of that total investment amount, only US$43 million -- which comes in under the government cap on China-bound investment of US$50 million in a single project -- will be taken from the company's capital with the remainder coming from overseas syndicated loans.

Another unit of the Formosa Group, Formosa Chemicals and Fiber (台灣化纖), is also planning to invest around US$293 million in an ABS plant -- which manufactures medium-strength, medium-cost plastic -- and a cogenerator in the Ningbo complex.

The Industrial Development Bureau has already approved Formosa's Ningbo investment, but reviews by the Mainland Affairs Council, the central bank, the Securities and Futures Commission and the National Security Council are all still ongoing, according to media reports.

The government's desire to carefully monitor Formosa's moves in China became evident last month when the Mainland Affairs Council requested more detailed information on the proposed project.

Wang Yung-ching (王永慶), chairman of Formosa Group, has blasted detractors who have slammed his calls for the government to ease limits on Taiwanese investment in China, saying the group's commitment to Taiwan is solid.

Wang has said that the business group has invested billions in Taiwan over the years while actual remitted investment in China has so far only totalled US$162 million, out of over US$300 million approved by the government.

Meanwhile, the Formosa Plastics Group is planning to establish three nursing schools to accompany the three branches of the Chang Gung Memorial Hospital (長庚醫院), which the group operates in Taiwan, to be built in China, according to reports.

There will be one nursing school built alongside each of the hospitals, which have been approved by Beijing and are to be located in Beijing, Fuzhou and Xiamen at a cost of over NT$20 billion, according to media reports.

Construction of the schools is expected to begin in January and should be completed within about six months, the reports said.
This story has been viewed 2560 times.