A Policy Study on Opening and Regulation of Foreign Portfolio Flows to Invest in Taiwan’s Capital Market

• Main Authors: Sing-Ying Lee, 李新穎
• Other Authors: Tsun-Siou Lee
• Format: Others
• Language: zh-TW
• Published: 2002
• Online Access: http://ndltd.ncl.edu.tw/handle/02165433239491992372

碩士 === 國立臺灣大學 === 財務金融學研究所 === 90 === Foreign portfolio institutional investors (FPII) usually exercise strong influence on domestic investors of the emerging markets in term of investment decision-making. Also, they enjoy competitive advantage in both asset and operational management skill thanks to their global organization and proven record in in-depth research and investment analysis. Their investment opinion and behavior are worth observing and studying since much more attention has been attributed to them, compared with the weight of their actual presence and exposure. As regards the Asia-pacific region countries, we found that all the censored securities regulators of the regional countries adopt open and appreciative attitude toward FPII. We also found the all the censored securities regulators confirmed that FPII has strong influence over local investors investment decision making. In addition, through policy study, we found that for the case of Taiwan, the following four issues are of FPII’s particular concerns: Political and economic stability; Continued financial reforms; Sound capital markets regulation; Elimination of current QFII regime. As policy recommendation, we suggest the reform to be conducted in two stages. First, gradual phase-out and abolishing of current QFII regime and substitute it with a streamlined and simplified foreign institutional investors (FII) regime. Second, replace the FII regime with ordinary regulation governing domestic investors, a practice being in place in many regional jurisdictions.