Lending extended by Taiwanese banks to China declined as of the end of March, marking the sixth consecutive quarter of decline at a time when the Taiwanese government is asking the banking sector to tighten their risk control on their exposure to the Chinese market, the central bank said.
Despite the decline, the bank said that China retained the title as the second-largest debtor to Taiwan on a direct risk basis, trailing the US on the back of a fall in Taiwanese banks’ exposure.
As of the end of March, outstanding international claims by Taiwanese banks to China on a direct risk basis stood at about US$43.2 billion, down US$6 billion, or 12.12 percent, from the end of December last year, the statistics showed.
Taiwan’s exposure to the US on a direct risk basis stood at US$64.59 billion as of the end of March, keeping Washington as the largest debtor to Taipei, the data showed.
On an ultimate risk basis, which calculates a nation’s consolidated debts after risk transfers, China remained the largest debtor to Taiwan, surpassing the US as of the end of March.
Taiwanese banks’ lending to China on an ultimate risk basis reached US$62.1 billion, down US$2.9 billion, or 4.39 percent, from a quarter earlier, but the figure surpassed the US$61.9 billion in Taiwan’s exposure to the US, the statistics showed.
Compared with a peak recorded at the end of September 2014, Taiwan’s exposure to China on an ultimate basis as of the end of March fell about US$32 billion, according to the data.
The central bank said the fall in Taiwan’s lending to China showed that the efforts made by the Financial Supervisory Commission have paid off.
The commission has urged banks to turn prudent when they extend loans to China-based borrowers, including Taiwanese businesspeople there, in a bid to prevent unwanted risks, especially as China’s economy slows down.
In terms of total outstanding international claims by Taiwanese banks, as of the end of March, the amount on a direct risk basis reached US$355.6 billion, up US$11 billion, or 3.2 percent, from a quarter earlier.
On an ultimate basis, Taiwan’s total international claims rose US$12.7 billion, or 3.95 percent, from a quarter earlier to US$334 billion.
On a direct risk basis, after the US and China, Hong Kong and Luxembourg ranked as the third and the fourth-largest debtors to Taiwanese banks as Taiwanese banks extended US$34.81 billion and US$34.03 billion to them respectively, as of the end of March.
Japan came in fifth with US$31.75 billion debt, followed by the UK with US$17.84 billion, the British West Indies with US$14.04 billion, Singapore with US$11.82 billion, the Cayman Islands with US$11.67 billion and Australia with US$11.15 billion.
Taiwan’s long-term economic competitiveness will hinge not only on national champions like Taiwan Semiconductor Manufacturing Co. (TSMC, 台積電) but also on the widespread adoption of artificial intelligence (AI) and other emerging technologies, a US-based scholar has said. At a lecture in Taipei on Tuesday, Jeffrey Ding, assistant professor of political science at the George Washington University and author of "Technology and the Rise of Great Powers," argued that historical experience shows that general-purpose technologies (GPTs) — such as electricity, computers and now AI — shape long-term economic advantages through their diffusion across the broader economy. "What really matters is not who pioneers
In a high-security Shenzhen laboratory, Chinese scientists have built what Washington has spent years trying to prevent: a prototype of a machine capable of producing the cutting-edge semiconductor chips that power artificial intelligence (AI), smartphones and weapons central to Western military dominance, Reuters has learned. Completed early this year and undergoing testing, the prototype fills nearly an entire factory floor. It was built by a team of former engineers from Dutch semiconductor giant ASML who reverse-engineered the company’s extreme ultraviolet lithography (EUV) machines, according to two people with knowledge of the project. EUV machines sit at the heart of a technological Cold
TAIWAN VALUE CHAIN: Foxtron is to fully own Luxgen following the transaction and it plans to launch a new electric model, the Foxtron Bria, in Taiwan next year Yulon Motor Co (裕隆汽車) yesterday said that its board of directors approved the disposal of its electric vehicle (EV) unit, Luxgen Motor Co (納智捷汽車), to Foxtron Vehicle Technologies Co (鴻華先進) for NT$787.6 million (US$24.98 million). Foxtron, a half-half joint venture between Yulon affiliate Hua-Chuang Automobile Information Technical Center Co (華創車電) and Hon Hai Precision Industry Co (鴻海精密), expects to wrap up the deal in the first quarter of next year. Foxtron would fully own Luxgen following the transaction, including five car distributing companies, outlets and all employees. The deal is subject to the approval of the Fair Trade Commission, Foxtron said. “Foxtron will be
INFLATION CONSIDERATION: The BOJ governor said that it would ‘keep making appropriate decisions’ and would adjust depending on the economy and prices The Bank of Japan (BOJ) yesterday raised its benchmark interest rate to the highest in 30 years and said more increases are in the pipeline if conditions allow, in a sign of growing conviction that it can attain the stable inflation target it has pursued for more than a decade. Bank of Japan Governor Kazuo Ueda’s policy board increased the rate by 0.2 percentage points to 0.75 percent, in a unanimous decision, the bank said in a statement. The central bank cited the rising likelihood of its economic outlook being realized. The rate change was expected by all 50 economists surveyed by Bloomberg. The
RSS