TAIPEI (CNA) — The Ministry of Economic Affairs (MOEA) claimed Tuesday that more than NT$200 billion (US$6.56 billion) in investments pledged by Taiwanese firms operating overseas, under an MOEA incentive program to encourage them to invest at home, will be realized by the end of this year.
Minister of Economic Affairs Shen Jong-chin (沈榮津) told reporters Tuesday Taiwanese investors that received approval from the MOEA’s incentive program are implementing their investment plans as promised.
By giving the figure about the funds to be invested by the end of this year, Shen sought to rebut criticism that the government is exaggerating the effects of the program.
Earlier this week, critics noted that although the government has said almost NT$700 billion in investment has been committed under the program, so far zero funds have been remitted into Taiwan from overseas by the firms making the pledges.
“Their investment plans are underway and we will see the real numbers by the end of this year,” Shen said.
The MOEA said the incentive program does not require the firms to move funds from overseas back to Taiwan to fulfill their commitment, they can also use funds in Taiwan to realize investment plans.
The ministry launched a raft of incentives in January to encourage Taiwanese companies that have shifted their operations overseas in recent decades, in particular to China, to invest more in Taiwan at a time of increasing trade friction between Washington and Beijing.
The trade dispute could seriously hurt Taiwanese firms manufacturing in China, because the products they export to the U.S. face higher tariffs.
The incentives include giving companies easier access to bank loans and a simplified process to recruit migrant workers, as well as services tailored to their needs.
Shen said 29 companies, including contract notebook computer maker Inventec Corp., computer peripheral product supplier Gigabyte Technology Corp. and network communication device provider Askey Computer Corp. will invest a total of NT$59.2 billion by the end of the year to expand their production capacity, in a bid to meet rising demand resulting from diversion effects caused by the Washington-Beijing trade disputes.
In addition, another 113 Taiwanese firms are also expected to invest about NT$166.1 billion by the end of the year to build new plants, Shen said, adding that 99 of them, including auto part maker Hotai Industrial Manufacturing Co. and linear motor stage maker Chieftek Precision Co., will start construction soon.
As a result, these Taiwanese firms will invest an aggregate NT$225.3 billion in Taiwan under the MOEA’s incentive program by the end of this year, Shen said.
So far this year, a total of 153 firms have received a green light from the MOEA under the incentive program to invest a combined NT$697.1 billion in Taiwan over the next three to six years and the massive investment is expected to create more than 50,000 new jobs, MOEA data shows.
Among the 153 firms, Innolux Corp., one of the largest flat panel makers in Taiwan, has pledged to invest NT$70.1 billion in the Southern Taiwan Science Park in a wide range of technological development such as artificial intelligence, which aims to facilitate the company’s smart production.
According to the MOEA, Innolux is the largest investor under the incentive program so far this year .
To make sure the firms implement their investment plans, Shen said the MOEA is closely monitoring the progress of those plans, and if they are not adhered to, the companies involved will have their preferential bank loan status revoked.