Taiwan places great importance on foreign and overseas Chinese investment and the government provides assistance to foreign nationals investing in Taiwan. Large-scale inward investment is a relatively recent phenomenon and more than 80 per cent of all inward investment has occurred in the last 10 years. The Ministry of Economic Affairs (MOEA) administers Taiwan’s macro-economic policy and monitors overall growth targets. Within the Ministry are a number of specialised agencies charged with specific responsibilities for the various aspects of economic planning and implementation.

Investment incentives:

1.Preferential taxes – Taiwan authorities enacted the statute for upgrading industries in 1991 to develop a favourable environment for foreign investors in Taiwan to encourage investment by foreign companies for the purpose of upgrading Taiwan’s industrial base.

2. Non-tax incentives – In order to encourage new product development by private manufacturers with R&D potential, the government may provide a subsidy of up to half of the cost of development and matching funds for the other half.

3.Low-interest loans – To accelerate industrial development and economic growth, a special fund has been set aside by the Development Fund of the Executive Yuan for cooperation with banks in providing various kinds of special low-interest loans.

4.Government participation in investment – To promote investment in high-technology industries, the Development Fund of the Executive Yuan directly invests in high-tech start-ups and in the procurement of new technologies by existing companies.

Investment restrictions

There are now few areas in which foreign investment is prohibited outright or otherwise limited. The Taiwan Government maintains two lists – a ‘negative’ list and a ‘restricted’ list, which detail broad areas where limitations apply. Overt limitations on overseas capital have been reduced substantially in recent times along with measures to internationalise the local economy and Taiwan’s entry to WTO. The Industrial Development and Investment Center (IDIC) website carries extensive information on investment incentives, programs and opportunities.

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