The government will boost the state-owned venture capital fund five-fold to NT$1 trillion (US$29.95 billion) to give local enterprises a leg up amid the global financial crisis, Council for Economic Planning and Development Chairman Chen Tian-jy (陳添枝) said yesterday.
The National Development Fund (國發基金) is a NT$200 billion public venture capital fund formed in 1972 to assist companies in strategic industries to develop.
Companies suffering from tight credit as a result of falling asset prices and sluggish sales in the wake of the global financial meltdown need help in restructuring their business, either through a capital increase or via an acquisition, Chen told a press conference after the weekly Cabinet meeting where the proposal was approved.
Chen said the government would offer financial assistance to companies in strategic industries that are vital to the nation’s long-term economic development. These mainly include companies in the manufacturing sector and some service and financial industries, he said.
To enlarge the National Development Fund, the government will borrow up to NT$800 billion from the postal savings fund owned by stated-owned Chunghwa Post Co (中華郵政), which had NT$4.13 trillion in assets as of last year.
Getting a loan from the postal savings fund shouldn’t be a problem as the National Development Fund has NT$200 billion in capital and is not in debt, Chen said.
“I believe the National Development Fund would get a good credit rating,” Chen said.
Chen assured Chunghwa Post depositors that the National Development Fund would bear full liability for the loan, saying the borrowing would not impair their interests.
Chen said the government would not “compete with the public sector for profit” as it would use the fund for investment in projects that are experiencing difficulties in luring private capital at home or abroad because of the financial crisis.
Asked to comment on Argentina’s debt crisis, Chen said there was little chance that Taiwan would have any problem relating to US dollar liquidity risks.
“We don’t need to worry about the problem at all as we have several advantages. First, Taiwan still has sizeable foreign exchange reserves despite the recent outflow of foreign capital. Second, the nation’s foreign debt remains low,” Chen said.
CHANGE OF MIND: The Chinese crew at first showed a willingness to cooperate, but later regretted that when the ship arrived at the port and refused to enter Togolese Republic-registered Chinese freighter Hong Tai (宏泰號) and its crew have been detained on suspicion of deliberately damaging a submarine cable connecting Taiwan proper and Penghu County, the Coast Guard Administration said in a statement yesterday. The case would be subject to a “national security-level investigation” by the Tainan District Prosecutors’ Office, it added. The administration said that it had been monitoring the ship since 7:10pm on Saturday when it appeared to be loitering in waters about 6 nautical miles (11km) northwest of Tainan’s Chiang Chun Fishing Port, adding that the ship’s location was about 0.5 nautical miles north of the No.
A Chinese freighter that allegedly snapped an undersea cable linking Taiwan proper to Penghu County is suspected of being owned by a Chinese state-run company and had docked at the ports of Kaohsiung and Keelung for three months using different names. On Tuesday last week, the Togo-flagged freighter Hong Tai 58 (宏泰58號) and its Chinese crew were detained after the Taipei-Penghu No. 3 submarine cable was severed. When the Coast Guard Administration (CGA) first attempted to detain the ship on grounds of possible sabotage, its crew said the ship’s name was Hong Tai 168, although the Automatic Identification System (AIS)
An Akizuki-class destroyer last month made the first-ever solo transit of a Japan Maritime Self-Defense Force ship through the Taiwan Strait, Japanese government officials with knowledge of the matter said yesterday. The JS Akizuki carried out a north-to-south transit through the Taiwan Strait on Feb. 5 as it sailed to the South China Sea to participate in a joint exercise with US, Australian and Philippine forces that day. The Japanese destroyer JS Sazanami in September last year made the Japan Maritime Self-Defense Force’s first-ever transit through the Taiwan Strait, but it was joined by vessels from New Zealand and Australia,
COORDINATION, ASSURANCE: Separately, representatives reintroduced a bill that asks the state department to review guidelines on how the US engages with Taiwan US senators on Tuesday introduced the Taiwan travel and tourism coordination act, which they said would bolster bilateral travel and cooperation. The bill, proposed by US senators Marsha Blackburn and Brian Schatz, seeks to establish “robust security screenings for those traveling to the US from Asia, open new markets for American industry, and strengthen the economic partnership between the US and Taiwan,” they said in a statement. “Travel and tourism play a crucial role in a nation’s economic security,” but Taiwan faces “pressure and coercion from the Chinese Communist Party [CCP]” in this sector, the statement said. As Taiwan is a “vital trading
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