Taiwan Banks Cut Loans In China Amid Slow Mainland Economic Growth, Military Tension

Taiwan’s banking industry’s lending to mainland China fell 16% year-on-year in September amid slowing growth that is economic mainland China and rising military tensions amongst the two countries, based on new Taiwanese government figures on Friday. Decreased.

According The Financial Supervisory Commission said its exposure, including corporate lending, investment and inter-bank use, decreased by NT$234 billion ($7.5 billion) from the same period last year to about 1.19 trillion at the end of September to the Central News Agency. Said the Taiwan was reached by it dollar.

The NT$1.19 trillion is the reason 28.9% from the industry’s net worth, the percentage that is lowest since the government commission began collecting data nine years ago, CNA said. According to CNA reports, the ratio was 30.2% at the end of May.

Beijing claims sovereignty over Taiwan and is an autonomous democracy with 24 million people, the world’s 22nd largestnd It is the economy that is largest and the place to find many global technology companies, including semiconductor manufacturer Taiwan Semiconductor Manufacturing (TSMC) as well as other Apple suppliers for example Hon Hai Precision, Pegatron and Lite-On Technology.

The Chinese People’s Liberation Army conducted high-profile exercises that are military the island after House Speaker Nancy Pelosi visited the island in August. According to government that is taiwanese, Taiwan is just one of the largest investors in the mainland, with nearly $200 billion in projects passed by Taipei authorities since 1991.

“there clearly was an imminent attempt because of the Chinese side to invade Taiwan,” President Joe Biden said at a news conference earlier this month after a three-and-a-half-hour meeting with Chinese President Xi Jinping prior to the G20 meeting in Indonesia. Really don’t think so,” he said. Chinese stocks were mixed week that is last hopes of easing tensions between China and its western trading partners after the G20 meeting.

Declining bank lending in Taiwan is one of the other signs that cross-strait bonds are weakening. Taiwanese firms’ interest in reducing their exposure to the mainland was confirmed by an survey that is interim the US-based Center for Strategic and International Studies. About 76% from the 525 Taiwanese companies agreed making use of statement that “Taiwan should reduce its dependence that is economic on China”, while only 21% opposed it. (see post here.)

More than a quarter of Taiwanese companies operating on the mainland have already relocated some production or procurement, and another third are considering relocating, according to a CSIS survey. . Only 31% said they have no plans to move at all.

The financial sector made up two of the top three families that make up Forbes Taiwan rich list this year. Cathay Financial Holding Chairman Tsai Hongtu and his brother Chenta ranked second with assets worth $10.5 billion. Richard and Daniel Tsai, who mostly get their fortune from Fubang Financial Holdings, ranked third after him with a fortune worth $9.6 billion.

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