Taiwan agreement opens the gate for Chinese investment

Ralph Jennings
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An investor-protection act between Taiwan and mainland China is fuelling speculation of blockbuster investments. Such deals are vital – even if only in a symbolic sense to begin with.

The signing of an investor-protection act between Taiwan and mainland China last month has set bankers’ tongues wagging about imminent blockbuster acquisitions and infrastructure finance projects in Taiwan.

Their talk centres on two specific projects in the works. Within the next year, sources tell Euromoney, a firm close to the Chinese government will take on a buy-operate-transfer (BOT) infrastructure project in Taiwan. The second deal involves a leading Chinese bank in talks to buy a share, under the 5% legal limit, in one of Taiwan’s 39 private banks.

The firms in question have not yet come forward publicly, but investment bankers in Asia are sure these two deals will happen.

It is clear that the agreement and the resulting deals are important, if only from a symbolic point of view at this stage.

The BOT deal and the China bank investment indicate that both sides meant what...