Financing program starts

Taiwan’s National Development Council (NDC) has initiated a US$1.38 billion financing guarantee program to assist companies expanding overseas, especially into the US. The program combines US$800 million from the National Development Fund with US$575 million pledged by 15 state-owned and private banks, including letters of intent signed by NDC Minister Yeh Chun-hsien. The goal is to reduce lending risks for financial institutions and encourage Taiwanese firms to integrate into US supply chains, particularly in AI-driven sectors. The mechanism aligns with a Taiwan-US investment memorandum of understanding and could support up to US$250 billion in corporate credit facilities. Applications for the program are expected to begin early next month, with Vice Premier Cheng Li-chun emphasizing its role in helping firms adapt to shifting global supply chains. The government is also negotiating tariff concessions for non-semiconductor sectors and zero-tariff quotas for semiconductor investments in the US. Critics have warned that increased US-bound investments could weaken Taiwan’s technological leadership and domestic job market. However, Cheng assured that ministries have established government-to-government channels with the US Department of Commerce to advance these discussions. Bankers’ Association Chairman Ray Dawn stated that the financial sector will support corporate expansion, offering competitive services once companies establish overseas operations. The program reflects Taiwan’s strategy to balance domestic investment with global expansion, particularly as AI and semiconductor demand reshapes industries. Financial institutions will play a key role in facilitating these transitions, reinforcing cooperation between government, industry, and banks.