Sun, Oct 07, 2007 - Page 8 News List

Letter: Don't mislead readers

In your article "Ma reiterates vow to open cross-strait transport if elected" (page 3, Oct. 1), it is claimed that "China-bound investment is capped at 40 percent of a company's net worth."

This is just one instance of an oft-repeated mistake, if not an outright lie -- a blind repetition of a politically convenient and malicious simplification of the current laws regarding investment in China by Taiwanese companies.

First, it is hardly ever noted that this limit only applies to public companies. In Taiwan, where small and medium businesses form the majority of companies, this is a relatively small percentage.

Second, it is not true that investment is capped at 40 percent of a company's net worth -- only capital raised in Taiwan counts. Larger companies in Taiwan almost always have much more capital in financial markets such as the US and Hong Kong. The restriction does not apply to any of that capital. Nor does any restriction apply to profits made in China, which can be reinvested freely.

The Democratic Progressive Party has engaged in a policy of "opening, with exceptions" and few of the old restrictions remain. The exceptions, besides the obvious defense industry restrictions, are in semiconductor manufacturing and LCD panel manufacturing -- areas in which Taiwan has been and continues to be a strong player. It should also be noted that United Microelectronics Corp has attempted to illegally circumvent the remaining restrictions.

Its larger, more successful competitor, Taiwan Semiconductor Manufacturing Co, has made no moves to invest in China, and founder Morris Chang said recently that debate over "opening" is a red-herring issue (假議題) taking attention away from the true keys to sustained economic competitiveness -- creativity and innovation.

The government should ease restrictions on setting up older-generation semiconductor plants in China, but this is one small step in a very broad policy of opening to China.

Taiwan's China-bound investment continues to be among the top of all foreign investors in China and two-way trade continues to climb to new heights.

I urge the Taipei Times not to mislead readers. Give them a more complete and balanced picture of this important issue.

James Lee


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