The government will guide Taiwanese businesses operating in China to return and invest at home, as the US-China trade dispute is expected to be protracted, Minister of Economic Affairs Shen Jong-chin (沈榮津) said yesterday.
The dispute’s effects on Taiwanese petrochemical, steel, aluminum and machinery producers in China would be limited, because most of their products are sold domestically in China, rather than exported to the US, Shen said.
Taiwanese semiconductor factories in China might even benefit, because they have a lower output than international giants such as Intel Corp and Samsung Electronics Co, giving them the flexibility to fill US orders in Taiwan and avoid punitive tariffs, Shen said.
However, if businesses are hit, the Ministry of Economic Affairs would guide them to return to Taiwan or form industrial clusters in Southeast Asia if moving their operations to Taiwan is not viable, Shen said.
Shares in Taiwan closed lower on thin turnover amid renewed concerns over the trade war, after China and the US failed to reach a breakthrough during their negotiations on Wednesday and Thursday, dealers said.
Investors were also cautious out of concern that Wall Street would be more volatile because of the legal troubles facing US President Donald Trump, dealers said.
Trump’s former lawyer Michael Cohen has pleaded guilty to eight counts of tax fraud, campaign finance violations, making false statements to a financial institution and unlawful corporate contributions.
Cohen also admitted to making payments to two women under Trump’s direction.
The TAIEX closed at 10,809.35, down 53.78 points, or 0.50 percent, after moving between 10,770.32 and 10,865.91.
Shares in contract chipmaker Taiwan Semiconductor Manufacturing Co (台積電) fell 0.41 percent to close at NT$243.5, iPhone assembler Hon Hai Precision Industry Co (鴻海精密) lost 0.86 percent to close at NT$81.1 and ASE Technology Holding Co (日月光投資控股), the world’s largest integrated circuit packager and tester, shed 0.81 percent to close at NT$73.3.
Selling was seen across the board, while many investors preferred to stay on the sidelines, sending trading volume down to NT$96.25 billion.
Foreign institutional investors sold a net NT$2.27 billion of shares on the main board yesterday, the Taiwan Stock Exchange said.
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