l Top financial regulators from both China and Taiwan met in Taipei in late April to explore ways to enhance cross-Strait financial cooperation.
l It was the first high-level discussion since the two sides formally inked a MOU in November 2009 on cross-Strait financial cooperation in banking, securities, futures, and insurance services.
l However, economic negotiators walked away empty-handed from the one-day meeting since both sides could not agree on the principle of reciprocity in market access.
l Taiwan’s banking community has long believed that their belated entry into China’s domestic market had placed them at a disadvantage with other foreign banks. An earlier permission for Taiwan banks to provide Renminbi (RMB) transactions will, therefore, enable them to become more competitive.
l Moreover, some local banks had hoped that both sides could reach an agreement on allowing financial institutions from China and Taiwan to take a greater financial stake—up from the current 20% to at least 40%—in the other. In the end, both sides also came away without an agreement since differences in market size made it impossible.
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