CHINA/TAIWAN: MOEA approves naphtha cracker investment plan

The approval came after the Cabinet in October eased regulations and gave a green light for local petrochemical companies to invest across the Taiwan Strait.

The ministry said it had approved USI Corp and six other companies' application to establish a joint venture with Gulei Petrochemical Co. to produce ethylene, propylene and butadiene.

However, USI and its partners - including Ho Tung Chemical Corp., LCY Chemical Corp. and China Petrochemical Development Corp - must report to the government on their Chinese investment from next year through 2019, the ministry said.

"The applicants are required to report to the government about their business operation on an annual basis and make sure to fulfill their promises such as shipping high-value products back to their home country,” the ministry said in a statement.

Other conditions include advanced research and development and high-value products they will make in Taiwan.

"The most important thing is to make sure ownership of the joint venture is secured by Taiwanese firms,” a government official said on condition of anonymity.

According to officials familiar with the matter, USI and the six other petrochemical companies are required to ship a certain amount of ethylene back to Taiwan to help solve the country's ethylene supply shortage problem in the future. They will also be required to inform the government about the composition of Gulei Petrochemical's board of directors and their shareholding structure.

Source: Daily "Taipei Times", Taipe; 28 Jan 2014(Syed Rashid Ali, Karachi, Pakistan)