The government is throwing open the doors to overseas investors today, officially scrapping limits on how much they may invest in the nation's US$340 billion stock market and simplifying the approval process for buying shares.
The abolishment of the qualified foreign institutional investor program, known as QFII, fulfills a promise made by President Chen Shui-bian (
The government is repealing a 12-year-old rule that limited each foreign institution to US$3 billion of the nation's shares, the Securities and Futures Commission (SFC) said in a statement. Overseas investors have been net buyers of NT$441 billion (US$13 billion) of Taiwanese stocks this year, helping fuel a 25 percent rise in the TAIEX.
"The QFII system served Taiwan well, helping its stock market to evolve from embryonic to a developed equity market," said George Ho, general manager of Jardine Fleming Taiwan Investment Management Ltd.
"The system came under attack only in recent years as Taiwan became ripe to open further," he said.
The system was credited by some for helping the country escape the brunt of the Asian financial crisis because the controls allowed the government to screen out foreign speculators, who were playing havoc with other markets in the region. In the second half of 1997, the TAIEX shed about 10 percent, while Hong Kong's benchmark index fell nearly a third and the South Korean index was halved.
The deregulation may prompt Morgan Stanley Capital International Inc to raise Taiwan's weighting in its indexes, the world's most widely watched by fund managers. Taiwanese stocks currently have about 55 percent of their market value represented in the MSCI indexes because of the cap on foreign investment.
"The expected weighting upgrade by MSCI will prompt overseas investors to buy more shares in Taiwan," Ho said.
Morgan Stanley Capital International Inc estimated in August that full weighting may prompt overseas fund managers to buy about US$6 billion more of Taiwanese stocks. At the time net foreign investment was US$8.6 billion. About US$3 trillion is benchmarked to MSCI indexes globally, according to the index compiler, which is majority owned by Morgan Stanley.
In scrapping the qualified institutional investor program, Taiwan is also dismantling a cumbersome approval process foreign investors had to undergo to get accredited.
Starting today, foreign investors will need only register with the Taiwan Stock Exchange Corp to receive lifetime permission to invest in Taiwanese stocks, though the SFC said applications will undergo "necessary reviews," without elaborating.
Taiwan Transport and Storage Corp (TTS, 台灣通運倉儲) yesterday unveiled its first electric tractor unit — manufactured by Volvo Trucks — in a ceremony in Taipei, and said the unit would soon be used to transport cement produced by Taiwan Cement Corp (TCC, 台灣水泥). Both TTS and TCC belong to TCC International Holdings Ltd (台泥國際集團). With the electric tractor unit, the Taipei-based cement firm would become the first in Taiwan to use electric vehicles to transport construction materials. TTS chairman Koo Kung-yi (辜公怡), Volvo Trucks vice president of sales and marketing Johan Selven, TCC president Roman Cheng (程耀輝) and Taikoo Motors Group
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
RECORD-BREAKING: TSMC’s net profit last quarter beat market expectations by expanding 8.9% and it was the best first-quarter profit in the chipmaker’s history Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), which counts Nvidia Corp as a key customer, yesterday said that artificial intelligence (AI) server chip revenue is set to more than double this year from last year amid rising demand. The chipmaker expects the growth momentum to continue in the next five years with an annual compound growth rate of 50 percent, TSMC chief executive officer C.C. Wei (魏哲家) told investors yesterday. By 2028, AI chips’ contribution to revenue would climb to about 20 percent from a percentage in the low teens, Wei said. “Almost all the AI innovators are working with TSMC to address the
FUTURE PLANS: Although the electric vehicle market is getting more competitive, Hon Hai would stick to its goal of seizing a 5 percent share globally, Young Liu said Hon Hai Precision Industry Co (鴻海精密), a major iPhone assembler and supplier of artificial intelligence (AI) servers powered by Nvidia Corp’s chips, yesterday said it has introduced a rotating chief executive structure as part of the company’s efforts to cultivate future leaders and to enhance corporate governance. The 50-year-old contract electronics maker reported sizable revenue of NT$6.16 trillion (US$189.67 billion) last year. Hon Hai, also known as Foxconn Technology Group (富士康科技集團), has been under the control of one man almost since its inception. A rotating CEO system is a rarity among Taiwanese businesses. Hon Hai has given leaders of the company’s six