( dpa ) - Taiwan's government said Wednesday it would relax rules on local investment in China, in a move criticized by the opposition as an attempt to canvass support ahead of the presidential election later this month.
In a cabinet meeting in Taipei, Premier Chang Chun-hsiung instructed that relevant authorities ease current curbs on the limit of China-bound Taiwanese investment.
He also asked for a sharp reduction in fines on local firms making unauthorized investment in China, a rival of Taiwan since the two sides split at the end of a civil war in 1949.
"Authorities concerned must swiftly work out relevant measures so that the new measures are able to be implemented in the shortest time," Premier Chang said.
Under the plan, the government would change the basis in defining the ceiling for China-bound investment.
Currently, a company can only invest up to 40 per cent of its net assets in China, but after the relaxation, a company can invest up to 40 per cent of the consolidated net asset value, which includes the net worth of companies from the same group.
"This would significantly increase the quota for local firms' China investments," Chen Ming-tong, head of the Mainland Affairs Council, said.
Also, local businessmen would only be slapped with a small fine if they register with the economics ministry their unauthorized investments in China, Chen said, but stressed the government still bar investments in high-tech and strategic industries in China.
Taiwan has banned direct links, but permitted investments in less crucial industries in China via a third place.
Opposition politicians in Taiwan, however, said the new plan is just a gimmick of the pro-independence ruling Democratic Progressive Party government to help its candidate Frank Hsieh woo voters ahead of the March 22 presidential election.
Local businessmen have repeatedly asked the government ease its rules on China investments.
Hsieh is running an uphill battle against his opposition Nationalist Party or Kuomintang opponent Ma Ying-jeou following the DPP's drubbing in January's parliament election.