Furthermore, the way the government has allowed manipulation and the formation of bubble markets in the capital and real estate sectors will only see the gap between rich and poor widen further.
Taiwan has always lacked a comprehensive set of economic development strategies and now the government is relying on a Chinese injection of funds without considering ways to really strengthen Taiwan, falling back on the Chinese Nationalist Party’s (KMT) old ways of deceiving people into thinking that a bright economic future is waiting just around the corner.
Since July 2004, China’s Ministry of Commerce has released three versions of the Catalogue for the Guidance of Foreign Investment Industries (對外投資國別產業導向目錄). This publication shows clearly how China hopes that Chinese businesses will invest in natural resources like petroleum, mineral resources and raw materials overseas. Does Taiwan possess these resources? Just what is the attraction for Chinese businesses investing in Taiwan?
Given Taiwan’s excess idle funds and savings, attracting a lot of Chinese funds without industrial transformation means that once Chinese investment enters the stock market and the real estate market in a big way, those investments will turn into speculative, short-term hot money that will widen the gap between what is happening on the capital markets and the real economic fundamentals.
In addition, the very first line of a set of guidelines released in May by China’s State Council — information from the Ministry of Commerce and the Taiwan Affairs Office for Chinese businesses doing business in Taiwan (兩部門就大陸企業赴台灣地區投資有關事項發通知) — says these businesses must not harm China’s national security or the goal of unification with Taiwan. The only thing the document doesn’t mention is “one country, two systems.”
The way in which the government follows the political rhetoric of China, gives into its nationalist policies and acts in conjunction with it in a stage show aimed at stealing Taiwan’s sovereignty is extremely worrying.
Wednesday marked the official opening to Chinese investment and will go down as a key day and an important dividing line in the development of cross-strait relations and Taiwanese history. The attitudes and abilities of our leaders will be the main factors that decide whether Chinese investment in Taiwan will be an opportunity or a risk.
Hong Chi-chang is a former chairman of the Straits Exchange Foundation and a former Democratic Progressive Party legislator.
TRANSLATED BY DREW CAMERON
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