Taiwan's FDIs Decline in H1, 2014 Due to Slow Regional Economic Integration

With cross-strait trade agreements stalled to exacerbate foreign investors' anxiety of Taiwan's slow regional economic integration, the island's foreign direct investments (FDIs) and Chinese investments both declined significantly in H1, 2014.

The latest statistics published by the Investment Commission in Taiwan show that some 1,656 FDIs valued exceeding US$1.9 billion were approved in H1, down 16.05% YoY. While foreign investors seem to be hesitant to invest in Taiwan, the downtrend in FDI has gradually improved for four consecutive months.

Meanwhile, 66 Chinese investments were approved, down 7.04% year-on-year (YoY), with the value plummeting 26.64% to only some US$158 million largely due to the lack of large investment projects, shows the statistics. In fact, Chinese investments in Taiwan dived  over 90% YoY in value in Q1 of this year.

The Investment Commission emphasized that  Chinese investment in Taiwan this year will probably not exceed last year's US$300 million, due to unlikely significant progress in talks between Taiwan and China on cross-strait trade agreements in the short-term.

By contrast, Taiwan's outbound investments numbered 234 projects in H1 for a 27.87% increase YoY, totaling US$3.032 billion to represent a 25.62% growth.

The number of approved Taiwanese investments in China slightly declined 1.93% YoY to 203 in H1, with the value up 9.46% to US$5.174 billion.

The Investment Commission explained that Taiwan's outbound investments have significantly increased for a couple of factors, including the increasingly stable global economic recovery, growing market demand for mobile Internet devices, and China's steadily expanding consumer market. (SC)