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More China-based businesses interested in returning

The number of Taiwanese businesspeople in China seeking land and manufacturing facilities in Taiwan has increased over the past two months amid rising labor costs across the Strait, an official at the Ministry of Economic Affairs said yesterday.

China implemented a new labor law on Jan. 1, raising the severance pay and giving Chinese workers the right to refuse to work overtime.

"There were around 60 applications by Taiwanese businesspeople in China, who were planning to return at the end of last year, with an estimated investment value of NT$8.5 billion (US$261.8 million)," an official at the ministry's Department of Investment Services said by telephone.

"Among the China-based Taiwanese companies that have applied to return, the electronics manufacturing industry ranked first in terms of number, followed by machinery manufacturing and traditional industries," the official said on condition of anonymity as he was not authorized to speak to the media.

The official's remarks came in the wake of a report by the Chinese-language Commercial Times yesterday saying more Taiwanese businesspeople were thinking of moving back home.

The official said that industrial parks in the north had seen the largest number of inquiries.

"Many businesspeople have asked about Taichung Industrial Park (台中工業區), but that area is saturated," he said.

Ilan County's Lize Industrial Park (利澤工業區) is also a popular option after the completion of the Hsuehshan Tunnel (雪山隧道), shortening the driving distance from Taipei to Ilan County from two hours to 40 minutes, he said.

Government incentives for land leasing at Lize Industrial Park have added to the location's attraction, an official at the ministry's Industrial Development Bureau said yesterday.

"The Ilan County Government provides free rent for the first two years, and 40 percent off for the third and fourth years. For the fifth and sixth years, companies will still be able to enjoy a 20 percent discount before paying the full amount the following year," Huang Chia-ling (黃佳鈴) said by telephone.

However, labor-intensive and high polluting businesses that have moved to China may find it hard to return after Taiwan's transformation and current focus on higher value-added industries, the official said.

The number of applications by Taiwanese companies to invest in China from January to November last year totaled 917, down by 66 cases, or 6.7 percent, from the same period a year ago, statistics released by the ministry's Investment Commission showed.

The investment amount during the same period totaled US$8.45 billion, an increase of US$2.05 billion, or 32 percent, from a year ago, the data showed.
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