Foreign direct investment (FDI) fell 18.24 percent to US$7.48 billion last year from a year earlier as COVID-19 spread worldwide, the Investment Commission said yesterday.
The number of approved applications from foreign investors fell 20.68 percent year-on-year to 2,711, it said.
Foreign investment is mainly in financial services and insurance, wholesale and retail trade, real-estate activities, information and communication technologies (ICT), and electronic parts and components manufacturing, the commission said.
Photo: David Chang, EPA-EFE
ICT saw the largest year-on-year increase in FDI inflows at 72.08 percent, while inflows to the real-estate industry grew by 38.03 percent year-on-year, it said.
The commission attributed the sharp decline in FDI to a continued worldwide rise in COVID-19 cases that affected foreign investors’ policies toward direct investment in Taiwan.
Nevertheless, Taiwan’s business environment remains attractive to foreign investors, the commission said, adding that it was optimistic that FDI inflows would increase once the global COVID-19 situation improves and cross-border restrictions ease.
Despite the drop in FDI last year, approved investments from countries listed in the government’s New Southbound Policy soared 162.32 percent from a year earlier to US$1.06 billion, with most of it coming from companies in Australia, Singapore and Thailand, the commission said.
The New Southbound Policy aims to enhance trade and exchanges between Taiwan and 18 countries in Southeast Asia, South Asia and Australia to reduce Taiwan’s dependence on China.
Last year, the value of investment applications from China approved by the government fell 7.97 percent to US$116.24 million from a year earlier.
The decline largely reflected changes in cross-strait ties, the US-China relationship, the volatile world economic situation and the government’s introduction of tightened regulations on Chinese investments, the commission said.
Since Taiwan lifted a ban on Chinese investment in June 2009, it has approved NT$2.53 billion (US$91.55 million) in funds from China.
Meanwhile, Taiwan’s approved foreign-bound investments rose 6.73 percent last year from a year earlier to US$1.26 billion, the commission said.
Last year, approved Taiwanese investments in China dropped by 0.73 percent from a year earlier to US$5.86 billion, it added.
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