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The sparkle of closer strait links

CLOSER cooperation between the Chinese mainland and Taiwan in the financial sector is expected to trigger growth in cross-strait trade and investment, industry watchers said yesterday in Shanghai.

"Now with a higher volume of cross-strait business and tourism flows, closer cooperation in different aspects is needed," Peter Yu, a partner at PricewaterhouseCoopers in Taiwan, said yesterday in Shanghai. "The closer cooperation in the financial industry is inevitable to support the growth."

Randy Ko, a PwC partner in Shanghai, said there will be more purchases from the mainland while mainland firms will be investing more actively in Taiwan over the next two years.

PwC said the two sides are also expected to cooperate in auto parts, retail, tourism and real estate in the first stage of cross-strait cooperation and investment.

Close to 800,000 tourists from the mainland are expected to visit Taiwan this year, a jump of 21.57 percent from a year ago. The occupancy rate among Taiwan hotels is set to grow 12.7 percent to 77.38 percent this year.

"Taiwan appears to be the bigger winner for now," said Sherman Chan, a Moody's economist. "The mainland also gains from the stronger ties with benefits to be realized in the longer term."

Taiwan's expertise in technology and telecommunications can help the mainland upgrade its industrial sector.

"Efforts from the mainland alone may not be sufficient to lift the island out of the recession, but should at least help ease the pain," Chan said.


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