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Call for better, more joint efforts

By Xing Zhigang in Taipei and Wang Lan in Beijing (China Daily)
Updated: 2008-11-06 07:40

Closer cross-Straits economic cooperation is necessary and urgently needed to overcome the global financial crisis, top mainland and Taiwan negotiators said on Wednesday.

Their remarks came at two seminars on finance and trade, held a day after the two sides signed four historic deals on air and sea transport, postal services and food safety.

Chiang Pin-kung(right), chairman of the Straits Exchange Foundation, escorts Chen Yunlin, president of the Association for Relations Across the Taiwan Straits, to a seminar in Taipei on November 5, 2008. [Asianewsphoto]

The opening sessions of the seminars were chaired by Chen Yunlin, president of the mainland's Association for Relations Across the Taiwan Straits (ARATS), and Chiang Pin-kung, chairman of Taiwan's Straits Exchange Foundation (SEF).

Mainland and Taiwan economies both are facing "their biggest challenge", Chen said. But "the agreements we have signed offer favorable conditions for us to overcome the difficulties".

"But that won't be enough We have to join hands to address the challenge," he said.

Chiang, too, said the SEF-ARATS agreements could help "tide over the financial crisis", for they create more favorable conditions for cross-Straits trade and exchanges.

"The mainland and Taiwan economies will have better prospects as long as they support each other and work jointly," Chiang said.

More than 60 bankers, industry leaders and economists attended Wednesday's seminars, aimed at finding ways to strengthen cross-Straits financial and trade cooperation.

MOU may be signed

The ARATS and the SEF may sign a memorandum of understanding (MOU) on financial supervision in the first half of 2009, an SEF official said on Wednesday.

"There is a possibility that we will sign a financial supervision MOU at the next round of talks in the first half of next year," SEF vice-chairman and secretary- general Kao Koong-lian said.

The MOU is expected to help realize some of the proposals and ideas discussed at the seminars, which include:

Establishing a clearing system for the yuan and the Taiwan dollar as soon as possible;

Allowing banks to open branches in each other's markets and buying stakes in the banks of others;

Allowing the mainland's qualified institutional investors to invest in Taiwan's stock market;

Creating a joint mainland-Taiwan-Hong Kong fund, backed by foreign reserves; and

Jointly developing logistics parks and terminals in both markets.

The talks on the opening up of the financial markets boosted financial stocks in Taiwan.

Chinatrust Financial and First Financial jumped 6.9 percent and 4.7 percent despite a 0.29 percent fall in the broader market.

A Shanghai-based expert said cooperation in a wider range of financial services could help Taiwan firms finance their ventures on the mainland.

"Greater financial cooperation will promote Taiwan investments and could help boost economic growth on the mainland," said Zhao Xinge, a professor of finance at China-Europe International Business School.

The cross-Straits trade volume reached a record $124.4 billion last year, with the mainland becoming Taiwan's biggest trade partner and largest source of trade surplus.

The number of Taiwan-funded projects on the mainland last year was 76,000, and their contracted investment, $100 billion. The measure of cooperation can also be gauged from the fact that about 1.5 million Taiwan people now work on the mainland.

Agencies contributed to the story