Taiwan toning down 'Go South' investment

Taiwan toning down 'Go South' investment

TAIPEI (Dow Jones): Taiwan is toning down its "Go South" policy, focusing more on helping Taiwan businesses cope in the crisis-torn Southeast Asian countries rather than encouraging new investment there, an official at the Council for Economic Planning and Development, or CEPD, said Thursday.

"We'd like to take a wait-and-see attitude," in terms of encouraging new investment in the region, Thomas Yeh, director general of the economic research department at the CEPD said. "For the time being, we're more interested in helping our investors in the region."

The "Go South" policy was hatched a few years ago to nudge Taiwan investors into the Southeast Asian region in an effort to reduce the reliance on China as a base for operations.

However, after the riots in Indonesia and amid the current political turmoil in Malaysia, the policy is being scrutinized by local businesses, activists and politicians.

The government is now concentrating more on helping Taiwan businesses control the damage to their Southeast Asian operations.

"Once the political situation in Malaysia is overcome, I think our investment there will increase again," Yeh said. "But for now, we should take some time out and see what the situation will be."

Taiwan is Malaysia's second-largest direct foreign investor and one of the biggest investors in Indonesia.

Taiwan's largest venture capital company, China Development Corp., recently established its Southeast Asian investment company. Twenty-one companies have pledged a total of NT$10.1 billion for investments in Southeast Asian businesses.