RI not good for investment now: Taiwan official
RI not good for investment now: Taiwan official
TAIPEI (Dow Jones): Taiwan will not halt its "Go South" policy in the wake of the atrocities committed against ethnic Chinese women during the May chaos in Indonesia, a senior official at the Ministry of Economic Affairs said yesterday.
"Our policy is to focus on the whole region, not just a single country," Thomas Yeh, director of the Economic Research Department under the Ministry of Economic Affairs, said.
"That's just a matter of priority. Among the regional countries, Indonesia is not a right place to make investments now," he said.
Recent reports that many ethnic Chinese women were raped and tortured during political riots in Indonesia earlier this year have triggered worries among Taiwanese businessmen in Indonesia that the relationship between the two countries will deteriorate.
Many are questioning whether Taiwan authorities will end its investment policy toward Southeast Asia on the Indonesian unrest. Taiwan authorities have urged Indonesia's government to investigate the rape reports as soon as possible.
"The top priority is to ask the Indonesia government to find out the truth and ask that protection be given to Taiwnese living in that country," Yeh said.
The "Go South" policy has strongly encouraged Taiwanese businesses to invest in Southeast Asia to diversify the risk of over-investing in China.
However, the research department's Yeh added that "the Go South policy aims at providing information on regional economies to local firms to provide them greater investment options; local firms can decide on whether to go or not by themselves."
Wang You-theng, chairman of Taiwan's General Chamber of Commerce, said late Wednesday, "If things couldn't be settled down soon, we will urge investors to abandon their investments there (in Indonesia)."
However, Yeh said, "we won't consider adopting economic sanctions on Indonesia now; we want the truth to be out soon."
The government will continue to monitor events in Indonesia and act accordingly, he said.
"We think that Taiwanese investment there will continue to shrink after the rape reports," Yeh said.
For the first half of the year, Taiwanese investment in Indonesia dropped to US$6.5 million from $23.6 million in the same period last year and Taiwan's exports to Indonesia also fell 48 percent from the year-earlier period to US$530 million, Yeh said.
Tumble
The Investment Commission here said separately that hammered by Asia's financial turmoil, Taiwan's overseas investment in southeast Asia fell sharply in the first half of 1998.
Taiwan's total overseas investment, excluding that in rival mainland China, rose 18.09 percent to $1.488 billion in January- June from the same 1997 period -- but investment shrank significantly in southeast Asia.
Taiwan interests indirectly invested $695 million in mainland China, up a brisk 40.22 percent from the year-earlier period, the commission said. Nationalist-ruled Taiwan has had no direct ties to the communist mainland since a 1949 civil war split and all investment must be routed through third places.
Taiwan investment into Moslem-majority Indonesia, where ethnic Chinese have been the target of mob violence, fell 76 percent from a year earlier, the commission said. It gave no exact figure.
"In addition to consideration of economic factors, (Indonesia's) political problems and strong anti-Chinese sentiment discouraged Taiwan investors, who have adopted a wait- and-see attitude," it said.
"Investment shrank sharply as a result," it said.
Crisis-hit Malaysia and the Philippines also saw declines, with investment dropping a year-on-year 72 percent and 51 percent, respectively.
The government's appeal for Taiwan firms to lend a financial helping hand by investing in southeast Asia has largely been ignored, with a majority of investment going to central American tax havens and the United States.