Should the nation's deregulation accelerate, Taipei has the potential to outperform Shanghai and Tokyo by 2012 to become a regional financial center, Greg Gibb, chief operations officer at Taishin Financial Holding Co (
Such a regional center would focus on the management of either pension funds or private equity funds, or as a fund-raising gateway for the world's high-tech companies, Gibb said at the speech organized by the Chung-Hua Institution for Economic Research (CIER) in Taipei.
"Taiwan must tap into the fast-growing Asian financial market in the next five years, which will be the main driver behind the nation's future economic growth," said Gibb, who was formerly a managing partner at McKinsey and Co.
As a precondition to outperforming its Asian counterparts, the nation needs to step up its efforts to make changes, including removing curbs to facilitate the free flow of tourists, talent, workers and businesspeople, he said, adding that the nation's financial market lags far behind that in Hong Kong and Singapore.
Gibb said Taiwan has to lift restrictions and allow local financial institutions, including insurers that are competitive and manage a huge amount of assets to freely set up shops around Asia to attract a larger inflow of investments from global pension funds.
Moreover, as private equity funds favor "ambiguous markets" such as Taiwan and China, Gibb believed they would certainly keep an eye on Taiwan as a stepping stone to China once cross-strait restrictions are eased.
Since the nation is also home to many leading high-tech companies, it has been playing the role of a global shaker to the world's high-tech sector and thus will no doubt be the most attractive market for global high-tech companies to go public if its market is innovative enough, Gibb said.
For example, if the local market can develop its futures and commodities market to trade high-tech products, such as DRAM chips, instead of traditional products such as gold and copper, the nation is highly likely to share the same success as the US' NASDAQ stock market, he said.
Gibb urged Taiwan to learn from the experience of the Netherlands, which may be small but has a strong economy with some of the top business players in the world.
Although Gibb shared with the audience his pleasure at living in Taipei, which he said has the best living quality in Asia, he also regretted a quote by a visiting researcher: "Taiwan is one of the most open societies in the world with the least vision of where it is going."