O/S TAIWAN-FUNDED COMPANIES SHOULD BE ALLOWED TO INVEST IN TSE.

TAIPEI, Sept 1 Asia Pulse - To replace Hong Kong as a capital-raising center in Asia, the government should allow foreign-based Taiwan companies to apply for listing on the Taiwan Stock Exchange (TSE), according to a report presented recently by a presidential economic advisory panel.

Such a move will fuel private-sector investment in Taiwan and help boost capital movements between Taiwan and mainland China, thus reducing one-way capital flight to the mainland, members of the panel commented in a meeting late last week.

The government ought to gradually ease restrictions on capital use by listed companies and should provide Taiwan-invested and overseas Chinese enterprises operating abroad with access to the domestic stock market, they suggested, adding that Taiwan stands a good chance to replace Hong Kong as a capital-raising hub in Asia by doing so.

Hong Kong has been losing its status and functions as a regional financial center since its reversion to Beijing's rule in 1997, and Taiwan should be able to succeed it to play that role, panel members said.

The panel's comments are indicative that a proposal suggesting to allow foreign-based Taiwan companies to invest and ...