Taiwan's Ministry of Economic Affairs is working on a draft amendment that is expected to greatly relax restrictions on investment in mainland China by the island's upstream petrochemical makers.
A ministry official said that the new amendment, which requires approval by the ministry's Investment Commission, could remove the blanket ban on Taiwanese investments in China by several key industries, including petrochemicals and petrochemical feedstocks, semiconductors, and notebook computers. Investments would, however, require approval on a case-by-case basis.
Under the terms of the proposed amendment, small and medium-sized companies would be allowed to invest a maximum of $60 million (Twn.), while the amount large, publicly owned companies can invest will be 20-40% of their total paid-in capital.
Taiwan's petrochemical industry welcomed reports that the new administration has decided to review the official policy of "no haste, be patient" that has barred upstream petrochemical producers from making any significant investments in China.
In addition to lower production costs in China, Taiwan's petrochemical producers say, the ability to set up production facilities there would offer the additional benefit of close proximity to their major customers, Taiwan manufacturers of midstream and downstream petrochemicals that have already moved operations to China.
