Investment by airlines gets okay

The government yesterday approved a total of US$157.4 million in investments in China for July, paving the way for plans by Taiwan's biggest airlines to jointly build a cargo terminal at the Gaoqi International Airport (高崎機場) in the Chinese city of Xiamen.

The Investment Commission under the Ministry of Economic Affairs approved investments amounting to US$3.4 million each by EVA Airways Corp (長榮航空) and Far Eastern Air Transport Corp (遠東航空) in the cargo terminal.

Investment of US$3.4 million in the project by China Airlines Co Ltd (中華航空) was approved last month by the commission while a similar investment by its subsidiary Taiwan Airport Service Co (台灣航勤) was approved earlier this year, according to executives at the airline.

The small scale of the individual investments ensured that the total dollar amount for each company came in well under the US$50 million cap the government places on single projects in China.

Once the cargo terminal is completed it will handle the distribution of heavy container cargo and provide warehousing facilities at the Gaoqi airport, which is one of China's largest.

Xiamen's Gaoqi International Airport opened in 1996, hosts 22 airlines, serves 52 domestic and international destinations such as Singapore, Penang, Kuala Lumpur, Manila and Jakarta, with more than 380 flights from Xiamen per week.

The investment, although small, is seen as an important step for Taiwan carriers that wish to gain a foothold in China's lucrative cargo market, which is expected to grow dramatically after the country enters the WTO.

Among other significant investments approved by the Investment Commission yesterday were plans tendered by Nanya Plastics Corp (南亞塑膠) to spend US$29 million on establishing a company named Nanya Epoxy Resin Ltd (南亞環氧樹脂), which will produce and sell epoxy resin in China.

Compeq Manufacturing Co Ltd (華通電腦) also received the green light to use its US$17 million earned in 2000 from dividends on shares listed in China and reinvest it into a subsidiary making printed circuit boards in Huizhou.

A further US$5.4 million was approved for investment by Compeq in a copper plating firm, also in Guangzhou.