Government to guide idle funds to infrastructure projects
The government will map out incentive programs to encourage private investments in key infrastructure projects, according to the Council for Economic Planning and Development March 10.
The Legislative Finance Committee passed a resolution March 10 that calls for cross-agency collaboration among the CEPD, the Financial Supervisory Commission and the Ministry of Finance on the matter. Efforts will be made to channel idle capital in the country’s banking and insurance sectors to invest in the i-Taiwan 12 Projects and the six key emerging industries.
Relevant measures include the introduction of an intangible asset appraisal system for the banking sector, so that financial institutions can use excessive funds to finance such projects. The CEPD will also provide information regarding investment opportunities to insurance carriers.
FSC Minister Sean Chen said that based on the outstanding negotiable certificates of deposit issued by the Central Bank of the Republic of China, Taiwan has about NT$6 trillion (US$188.4 billion) in idle funds.
According to Yang Chin-long, deputy central bank governor, there is NT$150 billion on the island that could be regarded as “international hot money” intended for currency speculation.
Excessive “hot” money is considered as a key contributor to real estate speculation, sources familiar with the issue said. Most of such funds come from the financial sector as well as international and mainland Chinese investors. The country’s insurance firms hold as much as NT$2 trillion in available funds for real estate investments, they added.
Chen pointed out that other than investing in government bonds, local insurance carriers can also invest in public infrastructure projects according to the Insurance Act. The commission has twice suggested the CEPD to make such opportunities available to these firms.
The CEPD said public projects suitable for investing include mass rapid transportation systems, the Kaohsiung Intercontinental Container Terminal, the Taoyuan Aerotroplis and the adjacent free trade zone, station development plans along the Taiwan High Speed Rail, the Central Taiwan Science Park as well as the Advanced Research Park in central Taiwan. (SFC-HZW)
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