The government yesterday designated a single-window clearance to provide assistance to and facilitate the processing of investors’ applications, targeting mainly China-based Taiwanese businesspeople.
As rising labor costs and other factors in China make its investment climate less favorable and other countries vie to offer incentives to investors mulling pulling out of China, Taiwan must also enhance its efforts to encourage overseas Taiwanese businesspeople to invest at home, Executive Yuan spokesperson Cheng Li-wun (鄭麗文) told a press conference.
The Cabinet announced a short-term plan to lure Taiwanese businesspeople home, with a goal of attracting NT$100 billion (US$3.42 billion) in each of the next two years to create NT$227.8 billion worth of export value, or NT$303.7 billion worth of output value, and provide 82,000 jobs for Taiwanese.
If the proposal works, it will add 0.31 percentage points to GDP growth and push the jobless rate down by 0.8 percentage points, the Council for Economic Planning and Development said.
Under the plan, which will run until the end of 2014, Taiwanese businesspeople whose investment proposals meet criteria and can complete construction of a factory within three years of applying are entitled to a set of incentives to address problems such as shortage of skilled labor, land acquisition and securing loans.
The designated one-stop shop, the Executive Yuan Global Investment Promotion Service Center, opens today in central Taipei.
To qualify for incentives under this plan, a manufacturer must be a global exporter of products with its own brand, hold a strategic manufacturing position within global supply chains, be a producer of high value-added products or key components, or be a multinational corporation with its research and development center or headquarters set up in Taiwan.
The threshold for high-tech manufacturing was set at NT$500 million invested in a project and NT$100 million for other firms, while a qualified investor was required to hire at least 100 Taiwanese in the first year after its facility is completed.
The incentives included a relaxation of rules governing the recruitment of foreign workers, an information platform for land acquisitions and policies to cultivate technicians and professionals, offerring loans of up to NT$10 billion at an interest rate of less than 2.375 percent, reducing tariffs on imports of manufacturing equipment and assisting the manufacturers in tapping China’s markets through the cross-strait Economic and Cooperation Agreement Framework.
Several business representatives were invited by the Cabinet to attend yesterday’s press conference.
World Taiwanese Chamber of Commerce president Lee Fang-hsin (李芳信) praised the government for its willingness to adopt a laissez-faire and flexible approach to improve the local investment environment, but he renewed calls for the government to exempt foreign workers’ wages from the minimum wage.
Council for Economic Planning and Development Minister Yiin Chii-ming (尹啟銘), the architect of the proposal, said that decoupling the standard salary for foreign workers from the minimum wage was not included in the proposal because of lack of consensus in society on the issue, but the council was studying the possibility.
Meanwhile, during a meeting of the Chinese Nationalist Party (KMT) Central Standing Committee, President Ma Ying-jeou (馬英九) said he expected the plan to attract Taiwanese businesspeople in China back to Taiwan to revive the economy and create more job opportunities for Taiwanese.
The changing investment environment in China, including stricter environmental protection regulations and rising wages, has prompted more Taiwanese businesses to move to other countries and the nation should step up efforts to improve the local investment environment to attract Taiwanese businesspeople to return to Taiwan, he said.
“We expect the plan to light up the nation’s economic outlook and also heat up the trend for Taiwanese businesses to return to Taiwan,” Ma, who doubles as KMT chairman, said after hearing a presentation on the plan given by Yiin at the meeting.
Ma said the nation has suffered from the industry exodus to China over the past years, and as China-based Taiwanese businesses are rearranging their investments, Taiwan should grab the opportunity to lure them back to Taiwan.
While expressing support for the plan, Ma stressed that the government would continue to protect the interests of local businesses.