Mon, Jan 01, 2007 - Page 1 News List

Perng defends yuan exchange plan

CASH IS KING Officials said yesterday that plans to permit people to exchange up to 20,000 yuan would not undermine Taiwan's sovereignty, despite the fears of some

By Shih Hsiu-chuan  /  STAFF REPORTER

The government yesterday pledged to move ahead with plans to allow the Chinese yuan to be exchanged in Taiwan proper, while emphasizing that the move would not undermine the nation's sovereignty.

The nation's currency is a symbol of its sovereignty and the yuan will not be allowed to circulate in Taiwan, central bank Governor Perng Fai-nan (彭淮南) said.

"To maintain the country's sovereignty, yuan carried into the country need to be converted into New Taiwan dollars first," Perng said during the Cabinet's year-end gathering.

Under current regulations, the yuan is exchangeable on Kinmen and Matsu, but not in Taiwan proper. Travelers are allowed to bring up to 20,000 yuan (US$2,560) in and out of the country per trip.

Late last month, Perng urged the government to open yuan exchange services in Taiwan, saying that the restrictions on exchange might foster the blackmarket circulation of the yuan in Taiwan, endangering the NT dollar's status as the nation's currency.

"Now is the best time to open up the yuan exchange business nationwide," he said, in response to a question by Chinese Nationalist Party (KMT) Legislator Joanna Lei (雷倩) during a Finance Committee meeting in the legislature last Monday.

Perng's suggestion, however, received no immediate response from the Cabinet.

Two cross-strait interaction measures were recently announced: Allowing more people to travel to China via Taiwan's outlying islands and permitting Taiwanese chipmakers to set up eight-inch wafer production plants with 0.18-micron processing technology in China. But the opening of yuan exchange services in Taiwan has not yet been put on the agenda.

Premier Su Tseng-chang (蘇貞昌) said on Saturday that the best time to open the service in Taiwan depended on how many Chinese tourists visited the country.

Mainland Affairs Council Chairman Joseph Wu (吳釗燮) told Taiwan Solidarity Union lawmakers last week in the legislature that the council would allow Chinese tourists to bring up to 20,000 yuan if they were permitted to visit the country.

During yesterday's gathering, Wu said that the government had been working on measures aimed at stopping black-market yuan transactions.

"The measures for clamping down on the black market will be put into effect in step with the opening of yuan exchange services in Taiwan," Wu said.

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