Despite the government's proposed plan for relaxing restrictions on foreign investment in the nation's stock market, it should implement failsafes to monitor irregular capital inflows and outflows in the future, analysts said yesterday.
The government should set up a capital-monitoring mechanism to prevent politically-motivated Chinese investments and international speculators from sneaking in to manipulate capital markets, TSU legislator Eric Wu (吳東昇) said.
In view of increased foreign inflow into Taiwan's securities market, the Chinese leadership and greedy speculative capitalists may be detrimental to the nation's markets, Wu said.
President Chen Shui-bian (
"The government should request [QFIIs] to declare the final beneficiary of each sizable transaction in order to detect questionable cash-flow, in or out [of the nation], which endanger national security or market stability," Wu said.
The businessman-turned-lawmaker said that precautions should be taken immediately to deter ill-intentioned capital inflows, which could end up damaging Taiwan's markets.
For example, he continued, Chinese capitalists may try to acquire a majority of shares in privileged telecommunications and broadcasting industries, or be interested in controling a listed company to adversely affect the nation's financial stability for political gain.
Even in a free-market economy, it's still reasonable to implement restrictions on "unfriendly investors," Wu said.
A local investment manager -- also surnamed Wu -- agreed, saying that Taiwan's economy is easily affected by outside forces.
"A quick infusion of money may be good news [for Taiwan], but if it is withdrawn just as quickly, the market could suffer dearly," said the manager on condition of anonymity, citing the 1997 financial crisis that had tormented Thailand.
Investors won't inject more foreign capital into Taiwan simply because of yesterday's announcement of the new policy. They will only do so because they are optimistic about Taiwan's fundamental conditions, the manager said.
In response to these concerns, both the central bank and the Securities and Futures Commission are reportedly working on supporting measures regarding the policy of opening-up foreign investment, which is slated for implementation by the end of the year.
The supporting measures include an ID-card system and a background check for foreign investors, who have to prove they have no connections with Chinese investors or international hedge funds, which may impact foreign exchange market operations, according to Chinese-language media reports yesterday.
SFC vice chairman Wu Tang-chieh (
GREAT SUCCESS: Republican Senator Todd Young expressed surprise at Trump’s comments and said he expects the administration to keep the program running US lawmakers who helped secure billions of dollars in subsidies for domestic semiconductor manufacturing rejected US President Donald Trump’s call to revoke the 2022 CHIPS and Science Act, signaling that any repeal effort in the US Congress would fall short. US Senate Minority Leader Chuck Schumer, who negotiated the law, on Wednesday said that Trump’s demand would fail, while a top Republican proponent, US Senator Todd Young, expressed surprise at the president’s comments and said he expects the administration to keep the program running. The CHIPS Act is “essential for America leading the world in tech, leading the world in AI [artificial
DOMESTIC SUPPLY: The probe comes as Donald Trump has called for the repeal of the US$52.7 billion CHIPS and Science Act, which the US Congress passed in 2022 The Office of the US Trade Representative is to hold a hearing tomorrow into older Chinese-made “legacy” semiconductors that could heap more US tariffs on chips from China that power everyday goods from cars to washing machines to telecoms equipment. The probe, which began during former US president Joe Biden’s tenure in December last year, aims to protect US and other semiconductor producers from China’s massive state-driven buildup of domestic chip supply. A 50 percent US tariff on Chinese semiconductors began on Jan. 1. Legacy chips use older manufacturing processes introduced more than a decade ago and are often far simpler than
Hon Hai Precision Industry Co (鴻海精密) yesterday said that its research institute has launched its first advanced artificial intelligence (AI) large language model (LLM) using traditional Chinese, with technology assistance from Nvidia Corp. Hon Hai, also known as Foxconn Technology Group (富士康科技集團), said the LLM, FoxBrain, is expected to improve its data analysis capabilities for smart manufacturing, and electric vehicle and smart city development. An LLM is a type of AI trained on vast amounts of text data and uses deep learning techniques, particularly neural networks, to process and generate language. They are essential for building and improving AI-powered servers. Nvidia provided assistance
Gasoline and diesel prices this week are to decrease NT$0.5 and NT$1 per liter respectively as international crude prices continued to fall last week, CPC Corp, Taiwan (CPC, 台灣中油) and Formosa Petrochemical Corp (台塑石化) said yesterday. Effective today, gasoline prices at CPC and Formosa stations are to decrease to NT$29.2, NT$30.7 and NT$32.7 per liter for 92, 95 and 98-octane unleaded gasoline respectively, while premium diesel is to cost NT$27.9 per liter at CPC stations and NT$27.7 at Formosa pumps, the companies said in separate statements. Global crude oil prices dropped last week after the eight OPEC+ members said they would
RSS