Taiwanese companies are cutting their exposure to China just as they ramp up investment in other parts of the world in the latest sign of how growing tensions between the US and China are reshaping global supply chains.
New investments in China by Taiwanese companies declined 10.4 percent year-on-year in the first quarter of the year to US$758 million, data released by the Investment Commission yesterday showed.
That follows an almost 14 percent decrease in such investment last year.
Taiwanese companies, traditionally among the biggest investors in China, have been reducing new capital expenditure in the world’s second-largest economy over the past decade. The slowdown has accelerated since former US president Donald Trump began pushing US companies to decouple from China, a policy largely continued by the administration of US President Joe Biden.
In addition to the slowdown in new money, Taiwanese firms pulled a record amount of profit out of China last year, Chinese-language media reported.
Taiwanese-listed companies repatriated NT$114 billion (US$3.72 billion) of investment income from China last year, the Financial Supervisory Commission said in a statement on Tuesday.
The paring back of cross-strait investment comes as China has ratcheted up the political, military and economic pressure on Taiwan since the 2016 election of President Tsai Ing-wen (蔡英文).
China responded to Tsai’s stopover in California early this month — during which she met with US House of Representatives Speaker Kevin McCarthy — with military drills around Taiwan.
Beijing officials have been keen to reverse the trend of Taiwanese firms exiting China.
Wang Huning (王滬寧), the No. 4 official in the Chinese Communist Party, promised greater efforts to persuade Taiwanese businesses to invest in China and to help them integrate into the Chinese economy.
Slowing investment in China stands in contrast to a rapid increase in Taiwanese investment elsewhere.
Total Taiwanese overseas investment, excluding China, surged 240 percent to US$6.9 billion in the first quarter, the Investment Commission data showed, with half of that due to a US$3.5 billion investment by Taiwan Semiconductor Manufacturing Co (台積電) in a plant in Arizona.
Investment in Southeast Asia also almost doubled as companies seek alternative production bases outside China.
EMBRACE CHANGE: Jensen Huang told NTU graduates that instead of worrying about AI itself, they should worry that people with expertise in AI would be taking their jobs Artificial intelligence (AI) is redefining the computer industry, and Taiwanese companies could play a major role in replacing the world’s traditional computers as they are the foundation of the industry, Nvidia Corp cofounder and CEO Jensen Huang (黃仁勳) said in Taipei yesterday. Huang made the remarks while giving the keynote speech at National Taiwan University’s (NTU) commencement ceremony. AI has created immense opportunities, and versatile companies can be expected to take advantage and boost their position, while less flexible firms would perish, he said. “In every way, this is a rebirth of the computer industry and a golden opportunity for the companies of
‘ARCHAIC’: An interpretation of a law that considered Chinese as Taiwanese nationals was scrapped after the death of a Chinese in Kaohsiung led to state reparations An administrative mandate to consider Chinese as Taiwanese citizens was outdated, Premier Chen Chien-jen (陳建仁) said yesterday, a day after the Executive Yuan ordered that agencies disregard the 30-year-old interpretation. Chen made the remarks at an event held by the Environmental Protection Administration in Taipei following changes to the administrative mandate concerning the Act Governing Relations Between the People of the Taiwan Area and the Mainland Area (臺灣地區與大陸地區人民關係條例). The previous interpretation of the law was archaic and contrary to the workings of laws and regulations, he said, adding that the order was made to avoid unnecessary problems created by the mandate. The Mainland
NOT BUYING IT: One of the goals of Beijing’s Cross-Strait Media People Summit was to draw mainstream media executives to discuss the ‘one country, two systems’ formula Taiwanese news media insist on press freedom and professionalism, and would never become a tool of China’s “united front” campaign, Premier Chen Chien-jen (陳建仁) said yesterday, responding to media queries about the lack of Taiwanese media executives at the Cross-Strait Media People Summit in Beijing. Chinese People’s Political Consultative Conference (CPPCC) Chairman Wang Huning (王滬寧) was reportedly furious that no Taiwanese media representatives attended a scheduled meeting with him on Thursday last week. “Beijing should take Taiwan’s determination to pursue freedom and democracy seriously. We also hope that it will not use vicious means to interfere with Taiwan’s development into a
IMMIGRATION REFORM: The legislative amendments aim to protect the rights of families to reunify, and to attract skilled professionals to stay and work in Taiwan Foreigners who are highly skilled professionals, top-prize winners in professional disciplines, investment immigration applicants or have made special contributions to Taiwan can soon apply for permanent residency on behalf of their spouses and minor or disabled children after the legislature approved amendments to the Immigration Act (入出國及移民法). The amendments, which were proposed by the Ministry of the Interior and approved by the Executive Yuan on Jan. 12, aim to attract foreign talent to Taiwan and encourage them to stay. They would take effect once they are signed by President Tsai Ing-wen (蔡英文). The amendments involved changing 63 articles, making it the biggest