Taiwan’s Ministry mulls changes in overseas investment policy: may lift naphtha investment ban

05-Sep-11

The Ministry of Economic Affairs (MOEA) is mulling a change in its existing overseas investment policy. A ban on Taiwanese companies investing in the naphtha-cracking sector in China may be lifted, but with some stipulations. These conditions are aimed to be negotiated with the Chinese government during the next Economic Cooperation Committee meeting. One of the key constraints will be the Taiwanese Ministry requirements that domestic firms have a 50% stake in crackers in China, which China does not allow. Also the MOEA may necessitate that a quota of output from plants in China would have to be shipped home to Taiwan to sustain the operations of the nation’s supply chain, and their investment in Taiwan must match that in China.