Taiwan to set up industry in Medan

Taiwan to set up industry in Medan

TAIPEI (Reuter): Taiwan's government has decided to invest some US$15 million to set up a 70-hectare (173-acre) industrial zone for Taiwanese and local firms in Medan on the Indonesian island of Sumatra, an official said yesterday.

The official with the economics ministry's International Economic Cooperation Development Fund (IECDF) said Indonesia's government had agreed to the plan and construction would start in May.

She said the IECDF hoped that more than 60 Taiwanese firms would invest over US$200 million there. So far seven have applied to use a total of 15 percent of the land.

The official, who declined to be identified, said the zone would help Taiwanese diversify their investments, particularly away from China with whom political relations are worsening.

A U.S. newspaper report last week said China has plans for a "limited attack" on Taiwan after presidential elections on March 23. China stopped short of denying the report.

The official said the fund would offer 70 percent of the US$15 million and the other 30 percent would be put up by the Taiwan industries interested in the project. It is expected to be completed some 15 months after construction begins.

From April 1 the IECDF will be converted into a non-profit organization, the International Cooperation Development Fund. It will grant loans to small- and medium-sized businesses from developing countries, said an IECDF director.

The IECDF, to be supervised by the Foreign Ministry, will also grant loans to increase cooperation between Taiwan companies and small and medium-sized businesses.