Sun, Jan 07, 2001 - Page 1 News List

China investment policy may be relaxed

By Tsering Namgyal  /  STAFF REPORTER

President Chen Shui-bian (陳水扁) yesterday hinted that Taiwan may relax its restrictive China investment policy under the condition that the move does not threaten the island's national security.

Chen said in a speech -- delivered on his behalf by Premier Chang Chun-hsiung (張俊雄) at the opening of the National Economic Development Conference -- that the government's "go slow, be patient" China policy reflects the "circumstances and the necessities of the time."

The government, however, may have to revise the policy as a part of the official campaign to boost the competitiveness of Taiwanese companies, many of which are now migrating to China.

Chang also echoed Chen's view by saying that the government is now "objectively reviewing the idea of full cross-strait links" in view of the eventual accession to the WTO of both Taiwan and China.

Such a move, he said, will help promote cross-strait cooperation and include China in the "global strategy of Taiwanese industry," fueling hopes that the government may be becoming more tolerant toward investment across the Strait.

But the deregulation of China's market after its entry into the WTO "deserves attention," he said, because China may increasingly lure away Taiwanese capital, skilled labor and technology.

Hundreds of officials, academics and businessmen met yesterday in what turned out to be a weekend brainstorming session to help jointly pull Taiwan out of its economic downturn.

"Taiwan's economic prosperity is facing a serious challenge," given the global economic slowdown and the downward correction in the economic growth of the major economic powers, such as the US and Japan, Chen said in the statement.

Minister of Finance Yen Ching-chang (顏慶章), Minister of Economic Affairs Lin Hsin-yi (林信義) and the chairman of the Council of Economic Planning and Development (經建會) Chen Po-chi (陳搏志) also took part in the meeting.

"Any economic transition offers opportunities for reform," Chen said, adding that the economic reforms will create a new phase of economic growth for Taiwan.

Chang also highlighted the seriousness of the challenge, saying that Taiwan's industries will face a "crucial test in the next five to 10 years."

"Our industries face the problems of inadequate infrastructure, lagging technological innovations and a shortage of high-tech personnel," Chang said.

Taiwan's ability to face the challenges brought about by the forces of globalization will be critical to the success of Taiwan in the first part of the 21st century, he said.

The government will help foster Taiwan's new superiority by promoting "knowledge-based industry" that turns out value-added products, he said. Taiwan will increasingly position itself as a research and development and financial management center for traditional industries.

To keep industries at home, Chang said, the government must try to attract investment by lowering taxes, training more skilled labor, helping with industrial waste treatment and cutting red tape.

Participants in the high-profile two-day conference are divided into 10 groups to discuss a wide range of issues. The subjects to be discussed relate to infrastructure, the tax environment, human resources, labor, environmental protection, business land zoning and financing for companies.

Also on the conference agenda are small and medium business enterprises, improving government efficiency, overseas investment and cooperation and encouragement of local government to attract investment.

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