Taiwan is open for business

The Taiwan stock market has come roaring back in the last couple of days, as this front page from the Apple Daily shows.

It chalked up a 12.4 percent two-day gain last Thursday and this Monday, with financial stocks doing especially well. (The market was closed Friday for the Labor Day holiday).

Why the exuberance? Tech demand is coming back, lifting Taiwan's electronics firms — and suggesting that the island's export economy may have turned the corner at last.

More importantly, Chinese money is on its way — gobs of it, potentially. In cross-strait commercial talks last week, Taiwan and China inked deals on financial cooperation, and the island signaled it would allow direct Chinese investment.

Details are yet to be ironed out, as this Reuters story notes. But if all goes well, qualified Chinese institutional investors will get the green light to invest in Taiwan's stock market, Taiwan banks will get to do direct business on the mainland, and Taiwan will open its massive infrastructure projects to Chinese companies.

In short: Cross-strait ties are cozier than ever, and investors are eyeing the payola.

Does that mean unification is next? Nope. So far, talks have studiously avoided politics — and analysts say it's likely to stay that way.

http://www.globalpost.com/notebook/china-and-its-neighbors/090504/taiwan-open-business