Taiwan joins race to lure talent and companies from Hong Kong

Nicola Smith
·2 min read
Taiwanese President Tsai Ing-wen has vowed to liberalise the economy - Ann Wang/Reuters
Taiwanese President Tsai Ing-wen has vowed to liberalise the economy - Ann Wang/Reuters

Taiwan plans to further liberalise its economy and offer more financing products in an effort to become an attractive Asian financial and asset management hub for international companies while nearby Hong Kong remains engulfed in political turmoil.

The measures announced by President Tsai Ing-wen on Wednesday aim to help Taiwan take advantage of capital flight from Hong Kong, sparked by ongoing social unrest and a draconian new national security law that has effectively ended the city’s already diminishing independence from Beijing.

Hong Kong has long been a gateway to China’s market but the question of whether it will continue to also be favoured as Asia’s central business hub is currently in doubt.

Seoul, Singapore and Tokyo are also vying to lure companies seeking a more stable political and business environment.

The city’s troubles coincide with moves by export-dependent Taiwan, which already has a very open economy, to diversify away from its traditional reliance on trade with China, in order to avoid Beijing wielding economic leverage over the island for political reasons.

China seeks to annex Taiwan, a WTO member which functions like any other nation with its own government, military and foreign policy, and has threatened to use force to do so.

While Taiwan is not expected to replace Hong Kong entirely, the government does hope to incentivise professionals and capital to base themselves on the island of 23 million.

Addressing a meeting of influential Taiwanese companies, including Foxconn, the world’s largest electronics manufacturer, President Tsai said there was growing international interest in Taiwan.

"More and more internationally renowned companies, and even more international-level capital, talent and technology, are bullish about Taiwan, are coming to Taiwan and increasing their investment in Taiwan," she said.

Ms Tsai added that the government would strive to sign more bilateral trade deals, including a possible agreement with the United States.