Hong Kong China Review Network published a special discussion today, pointing out that the Taiwan stock market plummeted by more than 360 points yesterday, closing at a low of 13,466.07 points, from 1,000 to 1,000,000, which has hit a new low of 22 months, and the market is full of sorrow. The major escape from foreign capital is not only related to international factors such as the US interest rate hike, but turmoil in the Taiwan Strait has intensified. On the 27th, Yang Jinlong, president of Taiwan's " Central Bank ", put forward the idea of adopting "foreign exchange control" when necessary, which scared the market even more. The Taiwan Strait is believed to be a war at any time, which has impacted Taiwan's economic stability.
U.S. Secretary of State Blinken mentioned in an exclusive interview recently that turmoil in the Taiwan Strait will impact the world, and most semiconductors are made in Taiwan. If anything happens, the global economy may be devastatingly affected. US Treasury Secretary Yellen also mentioned that Taiwan is the only source of advanced semiconductors that threaten US national security. Even senior American officials say this, how can the market not be tense? In addition, the Financial Times recently reported that in March this year, as many as 116 companies included the Taiwan Strait's tightness in the operating risks. The 12-month moving average number of entrepreneurs who put the Taiwan Strait at risk reached a high of at least 16 years.
Affected by the impact of American hawks interest rate hikes and geopolitics, Taiwan's official statistics have accumulated a net remittance of US$16.7 billion in the first eight months of this year, more than NT$250 billion in , setting a record for the largest net remittance in the same period in history. Zeng Mingzong, a Kuomintang legislator who was once the "Chairman of the Financial Management Committee" of the Ma Ying-jeou era, asked on the 27th that assuming that cross-strait tensions heat up and foreign capital withdraws more than 100 billion US dollars in a large-scale short-term, will the "central bank" have tools to respond? When answering the inquiry, Yang Jinlong mentioned that he would use foreign exchange controls when necessary, which scared foreign capital.
Taiwan's stock and foreign exchange market has recently won double defeats. exchange rate depreciated rapidly, and the stock market fell sharply. It can be said that it was a sudden rain again. The international economic situation is already bad enough. Taiwan was pulled by the United States again and cheered on, and the Taiwan Straits fought fiercely. In early August, U.S. House Speaker Pelosi and several congressmen visited Taiwan one after another to increase the number of exercises, military aircraft and warships around Taiwan.
Ma Ying-jeou has been worried about the cross-strait situation in recent days and has called for cross-strait dialogue. The United States should also encourage the Tsai administration to talk to the mainland to avoid the situation from getting out of control. Ma Ying-jeou believes that when he was in power, no one thought that the cross-strait would enter a state of war, but why is the gap so big now that the Taiwan Strait is described as the most dangerous place in the world? From his constant talk about the cross-strait crisis, we can see that he is very worried.
As the United States challenges the fire, it continues to release the news that the mainland wants to take over Taiwan, fearing that the world will not be in chaos. In fact, Taiwan can decide whether the cross-strait war or peace. The DPP authorities are not eased cross-strait relations or avoid war now, but are only concerned about buying weapons and discussing whether the United States will send troops is completely putting the cart before the horse. The senior executives of the DPP may think that fighting should not be a matter of immediate effect. As long as you support the end of the year first, Tsai Ing-wen will step down in 2024. But they miscalculated the situation. If Taiwan is considered to be a battlefield at any time, foreign and domestic capital will flee. Once the United States is forced to announce the extension of the compulsory service period, even people may run away. Can they hold on?
In other words, what the DPP has to face now is that before the situation in the Taiwan Strait is still in place, Taiwan’s funds are scared away by the expectation of fear of fighting. It can be seen that the Green Camp is good at political operations and campaigning, and seems helpless in the face of the recent massive escape from foreign capital. In the past, the "Guoan Fund" added confidence to the call may be useful, but now it is difficult to stop the continuous double kills of stocks and foreign exchanges when encountering internal and external adverse factors.
Taiwan officials are now looking forward to the lifting of the epidemic to boost the economy, but if they encounter a systematic collapse, it is useless to just rely on the unblocking market. Moreover, if mainland tourists in Taiwan’s largest tourism market cannot enter, the unblocking will only allow Taiwanese people to travel to Japan, South Korea and other places, and there are quite limited tourists who can enter.
Taiwan's "Central Bank" President Yang Jinlong declared in response to the inquiry on the 27th that Taiwan's foreign exchange reserves had a deposit of more than 500 billion US dollars, and if the funds withdrawn by foreign capital exceed 100 billion US dollars, it is still enough to respond. Yang Jinlong's statement may be too optimistic. If the DPP authorities allow the situation across the Taiwan Strait to worsen, they will really fight hard. It will be meaningless to talk about how long it can be kept in foreign exchange.(Source: Hong Kong China Review Network)
