China promises economic assistance to Taiwan

[December 20, 2008]  BEIJING (AP) -- China offered Saturday to help Taiwan boost its economy if it needs assistance to weather the world economic slowdown.

The statement at a meeting between China's Communist Party and Taiwan's ruling Nationalists in Shanghai comes amid new indications of warmth between the longtime rivals. Earlier in the week, the two sides initiated daily air and direct maritime links after a break of nearly 60 years.

"If the worsening world economic situation continues and the Taiwan side asks for help to solve economic difficulties, the mainland is willing to offer assistance with utmost efforts," said Jia Qinglin, the fourth-most-powerful person in the Communist Party of China, according to the official Xinhua News Agency.

Jia didn't specify what kind of assistance or how much would be offered, but urged Taiwan to make it easier for mainland businesses to invest there.

Stimulus measures by China to boost its economy will also provide trade and investment opportunities for Taiwan businessmen, he said.

The two-day forum between the two parties to discuss cooperation in financial and service industries and two-way investment opened in Shanghai on Saturday. The chairman of Taiwan's ruling Nationalist Party, Wu Poh-hsiung, and honorary chairman Lien Chan attended, as well as 400 delegates including businessmen, experts and officials from the two sides, Xinhua said.

During the forum, Wu urged the two sides to work together to ride out the global economic downturn, according to a Nationalist Party statement.

"We should help Taiwanese businesses on the mainland to secure (Chinese) loans," the statement quoted Wu as saying. "The two sides should also allow investment in each other's public infrastructure projects."

According to a statement on the Chinese government's Web site, Jia urged greater cooperation in financial services and called for a normal flow of capital across the Strait.

He said the two sides should sign agreements on the regulation of banking, securities and insurance firms.

Taiwan has seen a significant fall in its exports this year, one of the main engines of the island's economic growth. Exports hit a three-year low of $16.8 billion in November, falling 23 percent from a year earlier, as the island felt the pinch from the global slowdown.

Monday's lifting of the ban on direct links across the 100-mile- (160-kilometer-) wide Taiwan Strait is expected to generate new business for the two sides, who have annual bilateral trade at about US$100 billion.

Taiwan and China split amid civil war in 1949. China continues to claim Taiwan as part of its territory and has threatened to attack if the island moves to formalize its de facto independence.

Tensions between the rivals have abated significantly since the inauguration of Taiwanese President Ma Ying-jeou in May. In contrast to his pro-independence predecessor, Ma wants to tighten economic relations with China as a way of boosting Taiwan's economy.

Taiwan's Mainland Affairs Council spokesman Liu Te-shun, a Cabinet-level agency in charge of implementing Taiwan's China policy, told The Associated Press that Taiwan will soon allow senior government officials to visit China and is considering lifting a ban on military personnel traveling to the mainland.

Under current rules, only mid-ranking officials from Liu's council or officials invited by international organizations to attend forums in China can visit the mainland.

But Liu said Taiwan will let senior Cabinet officials, including ministers and their deputies, visit China in the near future as part of increasing cross-strait exchanges.

[Associated Press]

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