Applying for membership in the Beijing-backed Asian Infrastructure Investment Bank (AIIB) could benefit the nation’s economy — if the Taiwan’s sovereignty could be protected, top financial and economic officials said yesterday.
China proposed establishing the AIIB to provide finance to major infrastructure projects across the Asian region and it is expected to be set up by the end of this year. The US$100 billion bank is seen as possible rival to the Asian Development Bank, as well as the World Bank and the IMF, which are seen to be dominated by developed countries such as the US.
At least 35 nations have said they want to join the AIIB as founding members, including the UK, France, Germany and Italy, and Australia says it is considering joining.
In Taiwan, there is growing debate over whether the nation should seek to join as well.
Minister of Finance Chang Sheng-ford (張盛和) and Financial Supervisory Commission (FSC) Chairman William Tseng (曾銘宗) yesterday told lawmakers that they both agreed that participating in AIIB might benefit Taiwan’s development in terms of economic and financial perspectives.
“Joining the institution may offer quite a few business chances for Taiwan’s banking sector,” Tseng said in a question-and-answer session during a meeting of the legislature’s Finance Committee at the Legislative Yuan in Taipei.
Chang told the committee that the number of AIIB members may surpass the total number of the proposed members of the Trans-Pacific Partnership (TPP) and the Regional Comprehensive Economic Partnership (RCEP), which may offer advantages for Taiwan’s economy if the nation is part of it.
However, both Tseng and Chang said the prerequisite for Taiwan’s applying for membership would be the protection of the nation’s dignity and sovereignty.
The Ministry of Foreign Affairs and the Mainland Affairs Council might lead an inter-Cabinet discussion of the issue, they said.
The nation’s experience in participating in APEC and the Asian Development Bank could provide some lessons in this regard, they added.
Central bank Governor Perng Fai-nan (彭淮南) also backed the idea of seeking membership in the AIIB and suggested taking a pragmatic approach to such negotiations.
“As a central bank governor, I would advise the government strive for membership in AIIB as participation itself in a regional organization is positive for Taiwan,” Perng said.
In related news, Tseng and Chang said the drought may become a major uncertainty for the nation’s economy and stock market performance this year.
“If the water shortage continues, it may curb the nation’s industrial production, dragging down exports and overall GDP growth,” Chang said.
Asked if the Taiwan’s economic growth might fall below 3 percent this year due to the water shortage, as Yuanta-Polaris Research Institute (元大寶華研究院) warned on Wednesday, government officials said economic growth would be hurt only if the water shortage worsens.
The government last month raised its economic growth forecast for this year to 3.78 percent, from the 3.5 percent it estimated in January, with the Directorate-General of Budget, Accounting and Statistics scheduled to update the forecast by the end of next month.
Additional reporting by Crystal Hsu
NOTABLE SHIFT: By 2030, 50% of all laptops would be assembled in Southeast Asia, while Taiwan would still mostly focus on research and development, a report said Global laptop and desktop computer supply chains are expected to shift significantly away from China in the next 10 years, a Market Intelligence & Consulting Institute (MIC, 產業情報研究所) report said. By 2030, only 40 percent of global laptop production would remain in China, said the report, which was released on Thursday. “The reshuffling of the global supply chain will be one of the most important trends in the next 10 years,” the institute said in the report. “In the long run, key component makers will follow laptop assemblers in moving out of China.” The Taipei-based institute predicted most key component makers
NO VIRUS BLUES: A SEMI Taiwan official said that the virus does not slow down the global semiconductor industry’s investment in manufacturing equipment The production value of the nation’s semiconductor industry is expected to grow 16.7 percent this year from last year, outpacing the global industry’s 3.3 percent growth, industry association SEMI said yesterday. That would help Taiwan safeguard its second spot in the global semiconductor market with a production value of more than NT$3 trillion (US$102.73 billion), SEMI Taiwan president Terry Tsao (曹世綸) told a media briefing in Taipei for the Semicon Taiwan trade show beginning today. The global semiconductor industry’s production value is expected to increase to US$426 billion this year, SEMI said. In terms of semiconductor equipment investment, equipment billings from Taiwanese firms
Intel Corp has received licenses from US authorities to continue supplying certain products to Huawei Technologies Co (華為), a company spokesman said yesterday. Washington has been pushing governments around to world to squeeze out Huawei, saying that the telecom giant would hand data to Beijing for espionage. From Monday last week, new curbs have barred US companies from supplying or servicing Huawei. This week, the state-backed China Securities Journal reported that Intel had received permission to supply Huawei. China’s Semiconductor Manufacturing International Corp (SMIC, 中芯國際), which uses US-origin equipment to make chips for Huawei and other companies, last week confirmed that it had sought
Merck Group Taiwan yesterday said that it plans to invest substantially on expanding its fab in Kaohsiung’s Lujhu District (路竹) to better serve its local customers, including Taiwan Semiconductor Manufacturing Co (TSMC, 台積電). The company said it plans to expand its production space by 50 percent in the next five years and its workforce by about 40 percent, Merck Group Taiwan managing director Dick Hsieh (謝志宏) told a media briefing in Taipei. Hsieh declined to disclose investment details, but said that the latest investment would exceed the total amount Merck has invested in Taiwan over the past few years. Those investments would be