China says investment will help unification with Taiwan

BEIJING (Reuters) - China’s Industry Minister, Miao Wei, said on Saturday that investment across the Taiwan Strait can help achieve China’s aim of achieving unification with the self-ruled island, and called for Taiwan to be more open to Chinese businesses.

China deems Taiwan a wayward province to be taken back by force if necessary, though proudly democratic Taiwan has shown no interest in being ruled by autocratic China.

Defeated Nationalist forces fled to Taiwan in 1949 after losing a civil war with the Communists, but since a thaw began in the 1980s Taiwanese businesses have poured money into China, drawn by a common culture and language.

Chinese companies have also begun investing in Taiwan, but have run into problems since last year’s election of Tsai Ing-wen as president from the Democratic Progressive Party, which espouses China’s formal independence, a red line for Beijing.

China is deeply suspicious of Tsai, though she says she wants to maintain peace with China.

Speaking on the sidelines of the annual meeting of China’s parliament, Miao said economic cooperation between both sides of the Taiwan Strait had made huge progress in the last three decades since the two began their detente.

China welcomes Taiwan chip companies to invest in China, he added.

“Of course, we hope that openness is two-sided, not one-sided,” Miao said.

“We encourage and support Taiwanese companies to develop in the mainland, and at the same time Taiwan should have an even more open attitude toward mainland companies entering Taiwan,” he added.

“This way industry on both sides of the Taiwan Strait can join hands to develop, which is good for both economies, and is also extremely helpful for promoting the unification of our two sides and achieving the aim of one China,” Miao said.

While his comments were broadcast live on state television, the section about promoting unification was not included in the official online transcript of his news conference, an omission that was likely a sign of China’s sensitivity about being seen to use its companies to political ends.

Long-standing political tension between the neighbors has seen Taiwan put restrictions on Chinese investments in its prized semiconductor sector, with an eye to protecting intellectual property and trade secrets.

At least three major deals have fallen through since Tsai won last year’s election in Taiwan. All of them involved Chinese state-backed giant Tsinghua Unigroup, which planed to invest three chip test and packaging firms based in Taiwan: ChipMOS Technologies Inc, Siliconware Precision Industries Co Ltd (SPIL) and Powertech Technology Inc.

In December 2015, while on the campaign trail, Tsai called Tsinghua Unigroup’s investment plans a “huge threat” to the island’s semiconductor industry.

Editing by Simon Cameron-Moore