in
Scarcity and cost of land, shortage of labour, environmental protests, social and political instability, and official corruption were all cited as reasons for lack of interest investing. Half of those questioned planned to invest in China, and 44 per cent said they would invest in other Southeast Asian nations.
Foreign Direct Investment
14. According to Investment Commission figures, approved inward investment by foreigners in the first three quarters totaled 851 million US dollars, down 12 per cent from the same period of 1992. The only sectors to see increases were chemicals and base metals processing, while interest in electronics, trading, and the financial sectors all declined.
15. Outward approved investment (excluding in China) by Taiwanese in the period reached 1.03 billion, up 39 per cent year on year. It decreased in Malaysia, Indonesia and Thailand, and increased in the US,
US, Singapore, Philippines and elsewhere. Approved investments in China ran to 8,796 cases so far this year, worth a total of 2.7 billion US dollars. The majority of cases were in Shanghai and Shenzhen. The main fields of business were electronics (1,102 cases), precision machinery (1,140 cases), plastics, foods and base metal processing industries. There is no solid evidence that the macro-economic cooling measures in China have had much effect on the overall inflow of Taiwanese capital.
Six Year Plan
16. The cabinet approved in August a CEPD proposal to cut total spending on the plan from 8.24 trillion NT dollars to 6.03 trillion, and the number of projects from 775 to 632, of which 78 projects worth NT$613 billion have yet to be approved. Even with the cuts, the government will still have difficulty financing the NT$5.42 trillion worth of projects already approved. The government expects a a shortfall in funding of NT$392 billion for fiscal 1995 to 1997. (Fiscal year 1994 runs from July 1993 to June 1994.) Of the 554 projects so far approved, only 69 have been completed, and 152 are behind schedule. The Ministry of Transportation and Communications has completed a draft of the BOT (build-operate-transfer) law, which will provide the legal basis for private participation in transport-related projects in the Plan, and this now awaits screening in Parliament. of
Of the major infrastructure projects, completion of Kaohsiung Mass Rapid Transit has been put back by one year to 2001,
year to 2001, Taipei Mass Rapid Transit by one year to 1999, the high-speed railway from 1999 to
to 2003, East-West Express Highway from 1997 to 2003, and the southern section of second North-South motorway from 1998 to 2003. The second-phase budget for the High Speed Rail was deleted by Parliament in July, by a former Finance Minister and other MPs who were concerned about waste, inefficiency and rampant corruption in government procurement. The legislators do not oppose the railway itself, but believe it could be more efficiently and less wastefully built by the private sector. The
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