New Asia Developments = Opportunities for Investors

Robert Hsu, June 30, 2009

In this Issue:

Rising Fuel Prices, Burgeoning Profits
The Arms Dealer for China's Drilling Companies
The Chinese Ripple Effect
A Much-Needed Boost for Taiwan's Economy
One of the Hottest IPOs of 2009

The Chinese Ripple Effect

China's solid economic growth -- on track for a whopping 7% in 2009 -- is spilling over to other Asian economies, helping them to overcome the current global economic downturn. And one of the biggest beneficiaries of this ripple effect is China's island neighbor, Taiwan.

We talked a lot recently about the peace dividend between China and Taiwan since the election of the nation's pro-China president, Ma Ying-jeoh. Between direct flights and postal links to Taiwanese businesses in China and Chinese businesses in Taiwan, the two nations' ties have strengthened greatly over the past year.

And today, another huge step was taken in their relationship, as the Taiwanese government announced the 100 industries and projects it is opening up to Chinese investment.

Back in April, Taiwan announced that it was finally allowing China to invest directly in the island's economy. But the nation hadn't announced what areas it was permitting Chinese businesses to take part in.

In today's announcement by Taiwan's Ministry of Economic Affairs, it was revealed that Taiwan agreed to Chinese investment in 64 manufacturing sectors, 25 service sectors and 11 public infrastructure projects. Foundries, liquid-crystal display and telecommunications sectors are still closed to investment.

In addition, the two nations are looking into investments in each other's financial sectors -- a delegation from Taiwan will be visiting China over the next week to discuss these prospects. This is an incredible development when you consider that just 60 years ago Taiwan and China were involved in a civil war.

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