Bank of China (中國銀行), the first Chinese lender to set up a branch in Taiwan, aims to forge closer ties with Taiwanese firms with operations in China, including offers of yuan settlement services once Taipei and Beijing work out a mechanism, the lender’s president Li Lihui (李禮輝) said yesterday.
Li, who hosted the official opening of the branch in Taipei, said he met with officials at the central bank and the Financial Supervisory Commission for talks on business development plans.
“As a commercial bank, we hope the two sides can promptly set up a currency settlement mechanism,” Li told a media briefing.
WARNING: EXCESSIVE CONSUMPTION OF ALCOHOL CAN DAMAGE YOUR HEALTH
Photo: Liao Chen-hui, Taipei Times
Bank of China is the world’s top provider of yuan settlement services, which amounted to 803 billion yuan (US$126 billion) for the first five months of the year, Li said.
“We are the main [yuan] settlement bank in Hong Kong, Macau and Malaysia and we hope to extend the services to Taipei once regulatory barriers are removed,” he said.
With cross-strait trade valued at US$160 billion last year and Taiwan’s trade surplus totaling US$89.8 billion, yuan settlement would save Taiwanese firms with cross-strait operations significant foreign-exchange costs and allow them to better control foreign-exchange risks, Li said.
Currently, only designated banking units can conduct yuan exchanges, but they cannot take yuan deposits or provide yuan loans. Further, domestic lenders may provide yuan-related business for corporate clients through their offshore banking units.
The designated banking units have to go through either Bank of Taiwan (台灣銀行) or Mega International Commercial Bank (兆豐銀行) for currency settlements with Bank of China in Hong Kong.
Li said Bank of China plans to provide over 200 billion yuan to help Taiwanese firms expand in China in the next three years.
Potential borrowers are Taiwanese firms that can advance China’s development plans and meet lending criteria, he said.
Li said the Taipei branch would keep close contact with the headquarters of Taiwanese firms with operations in China so the lender can better mobilize its global resources to strengthen services.
TARIFF TRADE-OFF: Machinery exports to China dropped after Beijing ended its tariff reductions in June, while potential new tariffs fueled ‘front-loaded’ orders to the US The nation’s machinery exports to the US amounted to US$7.19 billion last year, surpassing the US$6.86 billion to China to become the largest export destination for the local machinery industry, the Taiwan Association of Machinery Industry (TAMI, 台灣機械公會) said in a report on Jan. 10. It came as some manufacturers brought forward or “front-loaded” US-bound shipments as required by customers ahead of potential tariffs imposed by the new US administration, the association said. During his campaign, US president-elect Donald Trump threatened tariffs of as high as 60 percent on Chinese goods and 10 percent to 20 percent on imports from other countries.
Taiwanese manufacturers have a chance to play a key role in the humanoid robot supply chain, Tongtai Machine and Tool Co (東台精機) chairman Yen Jui-hsiung (嚴瑞雄) said yesterday. That is because Taiwanese companies are capable of making key parts needed for humanoid robots to move, such as harmonic drives and planetary gearboxes, Yen said. This ability to produce these key elements could help Taiwanese manufacturers “become part of the US supply chain,” he added. Yen made the remarks a day after Nvidia Corp cofounder and chief executive officer Jensen Huang (黃仁勳) said his company and Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) are jointly
United Microelectronics Corp (UMC, 聯電) expects its addressable market to grow by a low single-digit percentage this year, lower than the overall foundry industry’s 15 percent expansion and the global semiconductor industry’s 10 percent growth, the contract chipmaker said yesterday after reporting the worst profit in four-and-a-half years in the fourth quarter of last year. Growth would be fueled by demand for artificial intelligence (AI) servers, a moderate recovery in consumer electronics and an increase in semiconductor content, UMC said. “UMC’s goal is to outgrow our addressable market while maintaining our structural profitability,” UMC copresident Jason Wang (王石) told an online earnings
MARKET SHIFTS: Exports to the US soared more than 120 percent to almost one quarter, while ASEAN has steadily increased to 18.5 percent on rising tech sales The proportion of Taiwan’s exports directed to China, including Hong Kong, declined by more than 12 percentage points last year compared with its peak in 2020, the Ministry of Finance said on Thursday last week. The decrease reflects the ongoing restructuring of global supply chains, driven by escalating trade tensions between Beijing and Washington. Data compiled by the ministry showed China and Hong Kong accounted for 31.7 percent of Taiwan’s total outbound sales last year, a drop of 12.2 percentage points from a high of 43.9 percent in 2020. In addition to increasing trade conflicts between China and the US, the ministry said
RSS