Taiwanese panels and semiconductors are among the 42 sectors to be included in the second wave of opening to investment by Chinese companies beginning on Monday next week, the Ministry of Economic Affairs (MOEA) said yesterday.
However, these investments have to fulfill certain prerequisites: They must be a complementary strategic collaboration among the cross-strait supply chain and Chinese investors must not have board control over their Taiwanese partners, the ministry said.
Other conditions state that Chinese firms must not hold a stake of more than 10 percent in local firms, or Chinese stakes must be less than 50 percent if they decide to form a venture with Taiwanese firms, Minister of Economic Affairs Shih Yen-shiang (施顏祥) said.
The above rules apply to five of Taiwan’s critical sectors — namely; chip manufacturers, chip packagers and testers, LCD-panel and related component makers, tool and machinery producers, and chip and electronic equipment manufacturers.
The government also opened other less critical sectors — manufacturing, services and public construction — to Chinese investment.
In mid-2009, the government lifted a ban on Chinese nationals investing in selected sectors such as textiles, plastics and handsets, marking the first time Chinese capital could gain access to Taiwanese companies.
The first wave of opening consisted of 205 sectors.
“The first wave was considered the experimental phase,” Shih said, adding the government evaluated the second wave of openings on the grounds that it must benefit Taiwan’s economy and supply chains and that these sectors were of interest to Chinese investors.
With yesterday’s opening list, Taiwan has opened up 42 percent of its manufacturing industry, 42 percent of its services industry and 24 percent of the public construction industry to China, according to the ministry’s figures.
New service-related sectors that are opening to China include theme parks, frozen logistics and tourism cable car transportation.
The public construction sectors to open to Chinese investment include airport maintenance, convention centers and drainage systems, among others.
Some non-critical sectors will be opened to China without specific conditions, such as stake-holding constraints, while some stipulate that Chinese stake holdings must not exceed 50 percent.
Taiwan’s telecommunications industry remains closed to China.
China Mobile Ltd's (中國移動) plans to buy a stake in Taiwan’s Far EasTone Telecommunications Co (遠傳電信) hasn’t been allowed, MOEA said
Taiwan has permitted 126 Chinese investments in local firms as of January since last year's opening, with amount totaling US$139 million.
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