TAIWAN authorities have been asked to remove restrictions hampering financial cooperation across the Taiwan Strait and to allow Taiwanese banks to set up branches on the Chinese mainland.
Vincent Yen, president of the Taiwan Council for Industrial and Commercial Development, said setting up outlets by Taiwan banks on the mainland would not only rescue cash-strapped Taiwan-invested ventures out of their financial doldrums, but also help improve their competitiveness globally.
"I believe if they are allowed to operate on the mainland, not only can Taiwan banks profit from the mainland's fast-growing economy, they will also expand their business and be more competitive," said Yen, who attended the 11th China International Fair for Investment and Trade in Xiamen.
Authorities on the island have imposed many barriers to block economic exchanges and trade development across the Taiwan Strait.
One of its restrictions stipulates that investments made by Taiwan investors on the Chinese mainland should not exceed 40 percent of their respective net assets.
"With the restrictions in place, many Taiwan-invested businesses - mostly small and medium-sized enterprises - on the mainland face difficulties in fund raising if they intend to expand their business," said Yen. "They face financial difficulty because these businesses are not big and as such don't have adequate credit guarantee in the Chinese mainland."
Taiwan officials have also banned the island's banks from opening branches on the mainland.
"Without the platform of the renminbi business, Taiwan financial institutions could not provide Taiwan investors with funds needed by them to cover growing procurement from the mainland," said Yen.