Sat, Jul 10, 2004 - Page 10 News List

Regional financial-hub role promoted by officials

By Joyce Huang  /  STAFF REPORTER

The nation's top economic planners said yesterday that they are working on a plan to see the nation replace Hong Kong as the region's financial hub.

"Our goal is to become the region's capital-raising center and asset-management service provider," Thomas Yeh (葉明峰), vice chairman of the Council for Economic Planning and Development, told reporters yesterday.

Council officials met yesterday to discuss measures to reinforce the financial service industry and to plan for an two-day conference in September at which 300 to 500 bankers will be invited to discuss financial strategies.

According to Yeh, the government's blueprint for developing the financial sector is to attract local businesses and multinationals, which usually prefer to raise capital by issuing oversea bonds, to take advantage of the nation's high foreign reserves and savings by issuing bonds locally.

A further relaxation of capital flow controls will be inevitable to achieve these goals.

"Measures will be proposed and adopted to improve the local capital and bond markets," Yeh said.

He also said that the government will consider policies to assist banks and securities brokers with asset-allocation management for individual investors and businesses' excessive capital.

Asked whether the government has made any progress toward allowing China-based Taiwanese companies to sell shares here, Yeh said the newly-established Financial Supervisory Commission is working with the Mainland Affairs Council and Ministry of Finance on steps to open the stock market in the near future.

"There may be concrete policies announced in two weeks," he said.

Yeh said China-based Taiwan-ese businesses whose headquarters are in this country will be put on the priority list for raising capital on the stock market.

However, he noted that the government may not relax its 40 percent limit on the amount of capital raised that can be raised in this country for China-bound investments. He said the government must protect local investors' money since the lack of cross-strait financial supervision could cause difficulties in tracing cash flows.

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