With financial cooperation expected to be a key issue in the upcoming cross-strait talks, the Democratic Progressive Party (DPP) warned yesterday that opening the market to Chinese banks and investment would not benefit the domestic economy.
Taiwan's Straits Exchange Foundation (SEF) and China's Association for Relations Across the Taiwan Strait are expected to include discussions on liberalizing the banking, securities and futures markets during the third round of cross-strait talks in Nanjing, China, from Friday through next Wednesday.
Taiwan Thinktank chairman Chen Po-chih (陳博志) told a DPP press conference yesterday that the administration of President Ma Ying-jeou (馬英九) had ignored the potential disadvantages of such market-opening measures.
Taiwan would only enjoy nominal equality in signing a financial agreement with China, because the terms of the agreement would be unfavorable to Taiwan in substance, he said.
Take banking for instance, Taiwanese banks would find it hard to compete with their much bigger Chinese counterparts, he said.
A Taiwanese bank might be able to establish five branches in China, but it would still be at a disadvantage compared with a Chinese bank that has 10,000 branches nationwide, Chen said.
It would still be easier for Taiwanese businesspeople to deal with Chinese banks than Taiwanese ones, he said.
Chen added that once cross-strait banking was allowed, Chinese banks would be able to access Taiwanese individuals and companies' financial data through the domestic Joint Credit Information Center and track whether they had been wiring money back to Taiwan.
Kenneth Lin (林向愷), an economics professor at National Taiwan University, said the main objective of Chinese businesses in investing in Taiwan would be to gain access to high-tech companies and acquire key technologies.
This would allow Chinese businesses to produce knock-offs in China that would hurt Taiwan's high-tech industries, Lin said.
He added that Chinese businesses were also interested in investing in Taiwan's public construction projects.
Winning these construction bids would give them control over local contractors, which are often key political power bases in Taiwan, he said.
At a separate setting, DPP caucus whip Ker Chien-ming (柯建銘) said the caucus was pushing for the creation of an inter-party legislative task force to monitor the government's cross-strait policies and interaction with China.
Ker and DPP legislators yesterday morning walked out of a closed-door meeting in which Mainland Affairs Council Chairwoman Lai Shin-yuan (賴幸媛) and other government officials were briefing lawmakers on the details of the preparatory cross-strait talks.
“The DPP caucus protested against cross-strait policies not being negotiated in the legislature,” Ker said.
He said the task force would facilitate monitoring of the government's performance on sensitive cross-strait issues, adding that the government's signing of important treaties with China without legislative approval had jeopardized the nation's democratic system.
Meanwhile, Legislative Speaker Wang Jin-pyng (王金平) yesterday expressed his support for SEF Chairman Chiang Pin-kung (江丙坤) amid media speculation that the SEF chief might be replaced.
Wang urged the public to encourage Chiang ahead of the cross-strait talks as Chiang's spirit had been affected by recent media reports that he might step down.