Tue, Mar 13, 2018 page1

• Little new in China’s incentives: official

  SECURITY CONCERNS: While Beijing is trying to cultivate intermediaries who can speak for it in Taiwan, the government is stepping up its efforts to monitor such connections

  • By Chung Li-hua / Staff reporter
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  Only two of China’s 31 incentives for Taiwanese are new, national security officials said yesterday.

  Beijing on Feb. 28 announced the incentives targeting Taiwanese businesses, civic groups, cultural workers and artists, but only two are new measures and the rest were either measures announced previously or extensions of existing measures, a security official said on condition of anonymity.

  Beijing is bringing its “united front” tactics to the table to develop intermediaries who could speak for China, the source said.

  As the incentives include funding for exchanges between Taiwanese and Chinese non-governmental organizations, it suggest that Beijing is trying to lure Taiwanese with financial benefits, the source said.

  In addition to revising the National Security Act (國家安全法), national security authorities have responded to China’s stepped-up activity by establishing a surveillance program to monitor the connections and finances of a number of groups and individuals close to Beijing, the source said.

  An investigation in December last year into the alleged involvement of New Party spokesman Wang Ping-chung (王炳忠) in an espionage case connected to convicted Chinese spy Zhou Hongxu (周泓旭) found that Wang had received US$200,000 from China’s Taiwan Affairs Office.

  Since the inauguration of President Tsai Ing-wen’s (蔡英文) Democratic Progressive Party administration in May 2016, China has provided funding or sponsored activities for specific groups in Taiwan, such as Aborigines, rural communities, religious groups and criminal organizations in a bid to develop local networks or instigate protests to influence elections and compromise Taiwan’s national security, the source said.

  By nosing its way into Taiwanese non-governmental groups, Beijing is developing proxies in Taiwan to execute its policies, the source added.

  One of the two incentives that are new allows for cooperation on sharing credit information between banking sectors.

  Taiwanese and Chinese bankers have proposed establishing a credit-information sharing mechanism, but the Financial Supervisory Commission has rejected it due to concerns over Beijing using personal information for political and surveillance purposes.

  China’s announcement last year that it would develop industrial parks in central, western and northeastern China targeting cross-strait cooperation to encourage Taiwanese businesses to move to those areas and participate in its Belt and Road Initiative was seen as a bid to counter Tsai’s New Southbound Policy by encouraging underperforming Taiwanese businesses to connect with Southeast Asian nations under the Belt and Road framework, the source said.

  Taiwanese businesses would be able to pay lower social insurance premiums under Beijing’s incentive program, they said, adding that the effectiveness of the policy remains to be seen.

  While Beijing has announced that 12 incentives were being offered exclusively to Taiwanese businesses, the ability to participate in the “Made in China 2025” program, infrastructure construction and government procurement was extended to all foreign businesses last year, the source said.

  According to a Chinese tax law implemented in 2008, a 15 percent tax benefit is extended to Chinese and international firms with advanced and innovative technology, and not exclusively to Taiwanese companies, the source added.
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