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Change Your Life! |
Taiwanese computer investment surges in China |
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News |
May 2, 2000
TAIPEI, MAY 1 (AP) - Taiwanese investment in computer and other hi-tech projects in rival China surged 330 percent to U.S. dollars 320 million in the first quarter this year, the government said Monday.
Officials said more Taiwanese computer firms were setting up factories in China, attracted by its vast market and ample supply of engineers and other technicians.
The first quarter electronics investment accounted for 57 percent of overall Taiwanese investment in China, said Taiwan's Investment Commission, which approves investment in China.
Last year, electronics investment totaled U.S. dlrs 530 million, or 43 percent of overall investment in China, the commission said.
The Acer group, Taiwan's largest computer maker, has invested U.S. dollars 200 million in China. It planned to build two more factories in the southern Guangdong Province to make computers, DVD players and spare parts.
The Economic Daily News said two top Taiwanese notebook computer makers, Arima Computer and Quanta Computer, planned to invest in China this year, becoming the last of the more than 20 main computer makers to invest on the mainland.
Taiwan makes nearly half of the world's notebook computers, but profit margin dropped significantly last year because of keen competition.
The newspaper quoted Quanta's vice president, Wang Wen-hua, as saying the company felt increasing pressure to cut its costs because nearly all other Taiwanese computer firms have invested in China.
Taiwan and China have been governed separately since a civil war in 1949. The Taiwanese government restricts investment in the mainland because it fears the island might rely too much on its rival's economy.
Taiwan bans large infrastructure investment in China and only allows its companies to make low-end computers using microprocessors no faster than 486.
Many Taiwanese computer firms set up simple assembly lines in China so they can switch to producing more sophisticated computers once Taiwan eases its trade policy toward China, said Chung Su-lan, an Economics Ministry official.
But others are believed to have violated the policy and are producing more sophisticated computers.
"We can't cross the border to inspect what computers they are actually making," she said.
Taiwanese computer firms used to invest mainly in southern China to make use of its cheap laborer, but an increasing need for capable engineers have prompted them to expand to eastern China, home to many of the country's top universities, officials said.
Taiwan's main semiconductor firms have yet to invest in China.
But Morris Chang, chairman of Taiwan Semiconductor Manufacturing Corp., the island's largest chip maker, said last week the company eventually will have to invest in China because of its growing computer market.
Setting up bases in China will allow the company to react faster to market needs, Chang said.
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