Lawmakers at a meeting of the legislature’s Finance Committee yesterday raised concerns about the lack of government guarantees as the nation’s financial sector heeds the New Southbound Policy, as Taiwan does not have official diplomatic ties with the 18 countries targeted.
Regarding the government’s plans to arrange a US$3.5 billion credit line for an official development assistance program to aid infrastructure projects in Southeast Asia, Chinese Nationalist Party (KMT) Legislator Alex Fai ( 費鴻泰) said the government must set aside the budget to help participating lenders in the event of default, especially state-run banks that are likely to bear the brunt of the risk exposure in carrying out government policies.
In response, Directorate-General of Budget, Accounting and Statistics Minister Chu Tzer-ming (朱澤民) said that apart from NT$1.5 billion (US$49.62 million) in interest rate subsidies, no such budget has been planned for next year.
The government would provide project assurance on a case-by-case basis, Chu added.
However, KMT Legislator Lai Shyh-bao (賴士葆) urged the government to secure more accords such as memorandums of understanding (MOUs) related to investment and trade, as well as regulatory collaboration with the 18 nations.
Financial Supervisory Commission (FSC) Chairman Wellington Koo (顧立雄) said that while the government would provide “a degree” of assurance on policy-related projects, lenders would be on their own in commercial dealings.
Taiwan has inked MOUs with 13 financial regulators across nine nations in the region.
Koo said the commission expects to add another agreement before the end of the year, and another in the first quarter of next year.
He declined to provide further details.
The commission said its tallies showed that profit contributions from Taiwanese banking operations in the markets targeted by the New Southbound Policy hit NT$3.52 billion in the first half of this year, greater than the previous six-month period’s NT$2.91 billion.
By contrast, banks have seen little growth in profit contributions from China since the signing of the Economic Cooperation Framework Agreement in 2010 by Taiwan and China, the commission said.
Earnings of Taiwanese banks in China have been affected by Beijing’s policies to cut excessive inventory, production capacity and financial leverage, which had stifled credit demand in the country, National Development Council Deputy Minister Chiou Jiunn-rong (邱俊榮) said.
Meanwhile, Chinese banks have stepped up efforts to attract reputable Taiwanese borrowers, Chiou added.
NEW IDENTITY: Known for its software, India has expanded into hardware, with its semiconductor industry growing from US$38bn in 2023 to US$45bn to US$50bn India on Saturday inaugurated its first semiconductor assembly and test facility, a milestone in the government’s push to reduce dependence on foreign chipmakers and stake a claim in a sector dominated by China. Indian Prime Minister Narendra Modi opened US firm Micron Technology Inc’s semiconductor assembly, test and packaging unit in his home state of Gujarat, hailing the “dawn of a new era” for India’s technology ambitions. “When young Indians look back in the future, they will see this decade as the turning point in our tech future,” Modi told the event, which was broadcast on his YouTube channel. The plant would convert
Nanya Technology Corp (南亞科技) yesterday said the DRAM supply crunch could extend through 2028, as the artificial intelligence (AI) boom has led the world’s major memory makers to dramatically reduce production of standard DRAM and allocate a significant portion of their capacity for high-bandwidth memory (HBM) chips. The most severe supply constraints would stretch to the first half of next year due to “very limited” increases in new DRAM capacity worldwide, Nanya Technology president Lee Pei-ing (李培瑛) told a news briefing. The company plans to increase monthly 12-inch wafer capacity to 20,000 in the first half of 2028 after a
Property transactions in the nation’s six special municipalities plunged last month, as a lengthy Lunar New Year holiday combined with ongoing credit tightening dampened housing market activity, data compiled by local land administration offices released on Monday showed. The six cities recorded a total of 10,480 property transfers last month, down 42.5 percent from January and marking the second-lowest monthly level on record, the data showed. “The sharp drop largely reflected seasonal factors and tighter credit conditions,” Evertrust Rehouse Co (永慶房屋) deputy research manager Chen Chin-ping (陳金萍) said. The nine-day Lunar New Year holiday fell in February this year, reducing
Zimbabwe’s ban on raw lithium exports is forcing Chinese miners to rethink their strategy, speeding up plans to process the metal locally instead of shipping it to China’s vast rechargeable battery industry. The country is Africa’s largest lithium producer and has one of the world’s largest reserves, according to the US Geological Survey (USGS). Zimbabwe already banned the export of lithium ore in 2022 and last year announced it would halt exports of lithium concentrates from January next year. However, on Wednesday it imposed the ban with immediate effect, leaving unclear what the lithium mining sector would do in the
RSS