Trade

Since 1979, the mainland has opened its market to Taiwan products, offering them preferential treatment such as tax exemption or reduction. In December 2000, the Ministry of Foreign Trade and Economic Cooperation of the PRC released Measures for the Administration of Trade with the Taiwan Area. The cross-Straits trade volume was a mere US $46 million-worth in 1978, but it shot up to US $44.66 billion-worth in 2002, approximately 971 times as much as the 1978 figure. By the end of September 2003, the accumulated volume of cross-Straits trade had totaled US $309.18 billion-worth, of which US $48.89 billion-worth came from mainland's exports to Taiwan, and US $260.29 billion-worth from Taiwan's imports, the mainland's trade deficit with Taiwan amounting to an accumulative total of US $211.4 billion. Since 1991 the mainland has become Taiwan's No.1 source of trade surplus. According to statistics, in 2002 the mainland had become the largest export market for Taiwan, and the island was the mainland's second-largest import market.

Investment

In July 1988, the State Council of the PRC issued the Regulations for Encouraging Investment by Taiwan Compatriots. In 1992 the Taiwan authorities permitted Taiwan compatriots to make indirect investment in, and carry out technical cooperation with, the mainland via a third place. In March 1994, the Standing Committee of the NPC adopted the Law on the Protection of Investment by Taiwan Compatriots. In December 1999, the State Council formulated the Detailed Rules for the Implementation of the Law on the Protection of Investment by Taiwan Compatriots, and local people's congresses and governments accordingly worked out corresponding local regulations and administrative rules in light of local conditions. A legal system was therefore formed or improved to protect the legal rights and interests of Taiwan compatriots in the mainland. Relevant departments and local governments in the mainland have made continuous efforts to improve investment environment and provide good service for Taiwan compatriots, thereby promoting their investments. By the end of September 2003, a total of 59,458 Taiwan-invested projects had been approved on the mainland, with the contractual value of Taiwan investment totaling US $67.98 billion, and the actually utilized Taiwan investment totaling US $35.71 billion. According to statistics from Taiwan, Taiwan business people have since 1993 taken the mainland as their first choice for outside-the-island investment.

Financial Exchanges and Cooperation

In 2002, mainland-based commercial banks officially started remittance and letter of credit business with the offshore bank units (OBU) of Taiwan-based banks. In 2003, they further opened this businesses with the domestic bank units (DBU) in Taiwan. By October 2003, the mainland had approved the establishment of 2 Taiwan-invested banks, representative offices of 7 Taiwan-based banks, 12 representative offices of 9 Taiwan-based insurance companies and 1 Taiwan-based insurance brokerage company, and 17 representative offices of 12 Taiwan-based securities companies.

In the process of promoting the "three direct links," non-governmental trade organizations across the Straits have carried out in-depth discussions time and again on relevant technical and professional issues involved in the "three direct links," and reached consensus in many aspects. Negotiations on inter-Straits communication have been going on successfully. Trial direct navigation across the Straits is operating smoothly. Delicate issues concerning two-way direct shipping between coastal areas of Fujian Province and Jinmen and Mazu have been properly resolved. Meanwhile, Taiwan-operated charter planes for the first time transported Taiwan's businesspeople across the Straits during the 2003 Spring Festival. All these facts show that businesspeople on both sides can undoubtedly find methods acceptable to both sides. As a matter of fact, both the technical and professional issues involved in the "three direct links" have been settled.