As concerns over the nation's economic dependence on China grow, the government hopes that Taiwanese firms will begin to explore emerging markets such as East Europe. But these markets may not be tempting enough to pull Taiwanese investors out of China in the short term, industrialists and pundits said yesterday.
Starting this year, the Board of Foreign Trade has targeted India and South Korea as new markets for local businesses in an effort to dissuade them from China. The board recently launched visits to countries in Eastern Europe and the Middle East as well as Russia, which the board said would be good for developing electronics, auto parts and heavy machines industries.
"To help local businesses to tap new markets is our goal, and we've seen great opportunities in these places," Chu Wei-cheng (
The move is needed after the Chinese government announced its latest macroeconomic control plan, as well as adverse policies against businesspeople who allegedly support Taiwan independence, Chu said.
However, one industry leader said even though various industries see large opportunities in less developed countries, most of them are still evaluating the viability of investing.
"As local business have less experience in these markets, it is safer for them to form alliances with European partners, especially West German companies, to reduce their risks," said George Lin (林添貴), deputy secretary-general of the Chinese National Association of Industry and Commerce (工商協進會).
The association is involved in the new market development plan.
A few Taiwanese investors have set up shop in Eastern Europe. Hon Hai Precision Industry Co (鴻海精密) set up a plant in Hungary last year and has another one in the Czech Republic. Asustek Computer Inc (華碩), the world's largest motherboard maker, also has a factory in the Czech Republic and markets its products in the region.
David Hong (
"The economic cool-down is good for investments because it will help avert a bubble economy," Hong said. "Besides, the opening of China's service market in 2005 will siphon off more Taiwanese money."
Hong said he believes the so-called China-fever will remain hot for the next few years.
The government has tried before to encourage Taiwanese businesses to invest in Southeast Asia, but to little avail. China is the nation's biggest trade partner, taking in more than a third of its exports.
According to government statistics, trade with China hit US$13.46 billion during the first three months of the year, up 33.7 percent from a year earlier. As export orders from China and Hong Kong hit record highs for the last two months, government officials predict the trade volume will continue to grow.
Hong advised Taiwanese busi-nesses to diversify their overseas investments, in view of a possible currency appreciation and Beijing's political threats.
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