The nation’s main stock exchange will seek to improve the local capital market by collaborating with its Asian counterparts, a Taiwan Stock Exchange (TWSE, 台灣證券交易所) executive said yesterday.
“Taiwan’s annual capital outflow is estimated at about NT$2 trillion [US$63 billion] annually,” TWSE president Michael Lin (林火燈) said at a press conference after the Asian Exchange Forum in Taipei.
Representatives from 10 Asian countries’ stock exchanges — including Japan, South Korea, China, Vietnam, Indonesia and Singapore — attended the forum, which was organized by the TWSE.
Through closer ties with other stock exchanges, about half of the capital outflow may be funneled through the TWSE to boost local trading volume, Lin said.
This could stimulate local brokering, depositary and clearing businesses, while providing investors with more options in which their interests are safeguarded by regulators, he said.
Lin said that representatives from neighboring stock exchanges all expressed an interest in furthering ties and collaborations with each other, and hope to introduce new products and stock exchange links.
Impressed by Taiwan’s many small and medium-sized technology companies, and their ability to pay out relatively high dividends, Japan and South Korea expressed an interest in possible collaboration opportunities, he said.
In particular, South Korean representatives brought up the possibility of devising a new stock index with Taiwan to tap into the trading potential of the nation’s technology companies, Lin said.
However, he said that a stock market link between the TWSE and the Korea Stock Exchange, and cross-listing of exchange-traded-funds (ETFs) on the two exchanges are not being considered at the moment.
He added that establishing stock exchange links and ETF cross-listings are not easy, as they have to deal with more technical and regulatory issues, in addition to finding market-makers and determining the types of products that will appeal to investors on other exchanges.
Although the Hong Kong-Shanghai stock market link has been operating for six months, preliminary work that went into its establishment took two years, Lin said.
Asked by reporters about his views on the capital gains tax on securities transaction, Lin said the issue did have an effect on the local stock market after first causing a market panic in 1988.
“Taiwanese investors panicked because they were not able to easily verify if the amount of capital gains tax they ought to pay was correct, as the local trading mechanism made it very difficult to calculate one’s gains and losses from trading, and this type of deep uncertainty proved to be catastrophic,” Lin said.
“The goal of the TWSE and the Financial Supervisory Commission is to aid the government in maximizing tax revenues under a system that is feasible and conducive to the nation’s capital market development,” Lin said.
“The equity market is an important facet of a nation’s economic growth, as direct financing is much more efficient than going through the banking system,” he said.
On Thursday, the commission released the results of the Securities and Futures Institute’s survey of major market players, brokerage firms and retail investors.
It showed that heavy tax burdens, difficulty turning a profit and plans to reallocate funds overseas were the top three reasons affecting many major market players’ interest in the local stock market.
As for retail investors, volatility in international markets, increasing misgivings caused by the TAIEX’s continued rise and excessive tax burdens on trading were the main holding them back from the market, the survey showed.
OUTBREAK: About 200 of the airline’s 1,200 pilots are not able to work. Most of them have been quarantined to prevent further infection, but 12 have COVID-19 China Airlines Ltd (CAL,中華航空) yesterday confirmed that it would temporarily reduce its cargo flight services to cope with a pilot shortage, as one-sixth of its pilots have been sidelined by a COVID-19 outbreak. “We are working out a new schedule,” the airline said in a statement after local news media reports on Saturday said that it would be reducing its cargo services from Wednesday, primarily affecting US destinations. CAL declined to give details about its new operating plan, but the reports said that it would be suspending its cargo flights to Dallas Fort Worth International Airport, Hartsfield-Jackson Atlanta International Airport and
The rise of the cryptocurrency dogecoin has reached a new level after the token was used to pay for a lunar satellite launch. SpaceX, Elon Musk’s commercial rocket firm, is to embark on a moon voyage next year carrying a so-called cubesat — a mini-satellite used for space research — from Geometric Energy Corp that has been paid for entirely in dogecoin. The development is the latest twist in the saga over the digital token, which started as a joke in 2013, but is now a dominating Internet meme and sitting on a 21,000 percent rally in the past year. Musk has
CAPACITY EXPANSION: Construction of the site, which is to be the firm’s first mRNA production facility outside of Europe, is to begin this year and likely finish in 2023 COVID-19 vaccine maker BioNTech SE yesterday said it would build a Southeast Asia headquarters and manufacturing site in Singapore to produce hundreds of millions of messenger RNA (mRNA)-based vaccines per year. Construction of the site would start this year, and it could become operational by 2023, the German company said in a statement. “With this planned mRNA production facility, we will increase our overall network capacity, and expand our ability to manufacture and deliver our mRNA vaccines and therapies to people around the world,” BioNTech chief executive Ugur Sahin said. The vaccine produced by BioNTech jointly with Pfizer Inc of
STAKING A CLAIM: Spain plans to spend about 13 billion euros to promote domestic sales of EVs, build a battery cell plant and attract automakers Spain is moving aggressively to land new battery and electric vehicle (EV) plants, using billions of EU COVID-19-pandemic relief funds to avoid being left behind as the global auto sector undertakes the biggest technology transformation in a century. As Europe’s second-largest vehicle-producing nation, behind Germany, and with the automotive sector accounting for 10 percent of its economy, Spain has a lot to lose as automakers overhaul supply chains and manufacturing for electric vehicles. Germany and No. 3 European producer France are already pouring funds into battery plants, supporting their respective national champion automakers, and Volkswagen AG and Renault SA are investing heavily