Taiwan Courts Investment, Talent, with EU, Hong Kong Overtures

An investment agreement with the European Union?

On Friday, Taiwanese President Tsai Ing-wen called on the European Union to sign an investment agreement with Taiwan, touting the island’s democracy and economic stability amid concerns over the world’s supply chain reliance on China during the COVID-19 pandemic. President Tsai’s call, which came just days after the EU raised restrictions on Chinese investment, would benefit Taiwan’s outbound investment too as its firms shift from building factories in Mainland China to other countries, and back home. Investment returning to Taiwan from China is forecast to reach more than C$15 billion this year, an estimate that may yet increase as earlier this month Taiwan announced C$500 million in subsidies to attract tech investment.

Moving to attract Hong Kongers . . .

Taiwan also announced last week that it will set up a specialized office to help Hong Kongers relocate to Taiwan after China’s recent move to impose a highly-contentious national security law in Hong Kong. The Minister of Taiwan’s Mainland Affairs Council, Chen Ming-tong, said that Beijing’s new law presents a “great opportunity for Taiwan to attract talent,” targeting Hong Kong professionals moving for school, employment, investment, and entrepreneurship. The new office is set to open on July 1.

And enticing Hong Kong’s businesses, too . . .

The office will also help Hong Kong-owned multinational corporations establish operations in Taiwan. Results are expected to vary; while Hong Kong may lose firms to Taiwan, especially in the tech sector, banks and financial firms are unlikely to flock to the island due to its relative lack of financial infrastructure. As Taiwan attempts to seize the moment amid COVID-19 and Hong Kong’s diminishing autonomy, its democracy and treatment of people seeking asylum could strengthen its position as an Asia Pacific investment hub.