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No Taiwan-wide yuan exchange for now, official says

The government will not permit the exchange of Chinese yuan in Taiwan proper, because the experiment in conducting such a service on the outlying islands of Kinmen and Matsu beginning last October has fallen short of expectations, an official said on Friday.

Mainland Affairs Council (MAC) Chairman Joseph Wu (吳釗燮) made the remarks while responding to a press query about the government's stance on a plan by some opposition lawmakers to push for revisions to the current statute governing engagements across the Taiwan Strait to allow for yuan exchange services in all of Taiwan.

China has refused to talk with Taiwan on the establishment of a bilateral currency exchange mechanism, Wu said. Nevertheless the government opened Chinese yuan exchange services on Kinmen and Matsu, both of which lie closer to China's Fujian Province than to Taiwan, on Oct. 3, last year on an experimental basis.

"The experiment failed to live up to our expectations because many people have bought yuan in anticipation of a yuan appreciation. At the end of the day, the number of yuan buyers was nine times the number of yuan sellers and the yuan stash in Taiwanese society has continued to rise," Wu said.
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