The Role of High Technology in Mainland China’s Outward Investment into Taiwan: Economic, Security and Cultural Dimensions

Abstract

On 30 June 2009, under the general mood of improving cross-Strait relations, the government of Taiwan made a firm commitment to open the island’s borders to investments from mainland China, Before then, capital flows between mainland China and Taiwan had been largely a one-way street: thousands of Taiwanese firms and Taishang (Taiwan-based entrepreneurs) had invested millions in low-cost production activities on the mainland, as Chapter 4 discussed in great detail, while most companies from the People’s Republic of China (PRC) were barred from entering Taiwan as a direct result of the cross-Strait political impasse and the potential threat to the island’s security.¹ On 9 August 2012, this was to change for good — Taiwan’s commitment to the entry of mainland direct investment (MDI) was set firmly in stone by the signing of the Cross-Strait Bilateral Investment Promotion and Protection Agreement (Cross-Strait B1A). an investment treaty of similar format to the thousands concluded among countries worldwide. This agreement was one of the many agreements to follow the conclusion of the Economic Cooperation Framework Agreement (ECFA) signed by both sides on 29 June 2010.