Taiwan plans to continue opening up its economy with the intent to become an Asian financial services hub, President Tsai Ing-wen said Wednesday, as Hong Kong’s future as a global financial center hangs in the balance because of increased pressure from mainland China.
Speaking to a group of Taiwan’s largest companies, Tsai made no direct mention of Hong Kong, but said Taiwan would continue to adopt more measures to open the economy, develop more diverse financial products and expand the country’s wealth management business in order to make the island an Asian corporate financing and high-level asset management center.
Though Taiwan has a ways to go before overtaking Hong Kong as a financial capital, the security law imposed on the latter by China earlier this year combined with the economic fallout of COVID-19 may give Taiwan an opening. Some financial institutions, such as HSBC, have chosen to support the new security law in order to protect their place in the Chinese economy. Others, however, have begun pulling back from Hong Kong.
Earlier this year, Taiwan opened an office meant to facilitate migration from Hong Kong in a bid to attract bankers, skilled workers and companies seeking to escape China’s increased control over the territory. Taiwan’s Mainland Affairs Council said it hopes the office will attract capital and professionals from Hong Kong to Taiwan to spur new opportunities in the country’s financial sector.
Tsai also said Wednesday that Taiwan would pursue more international trade agreements, including a free trade pact with the U.S. She also said she wants the country to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership.
Taiwan’s international trade deals are few and far between, as many countries are not willing to cross China, the world’s second-largest economy, which considers the nation part of its territory.
Tsai said, though, that she would seek to strengthen Taiwan’s ties to the World Trade Organization and Asia-Pacific Economic Cooperation bloc, both of which the country is a member.
Tsai was first elected as president in 2016 and reelected earlier this year. In her inauguration speech in May, Tsai said adopting more flexible financial policies and reforming financial systems was a top priority, as financing is key to industrial development and diversifying the Taiwanese economy.
--Additional reporting by Minyoung Park and Rachel Uda