ECFA Ignites The Upsurge Of Shoe Enterprises Listing In Taiwan

The "Cross Strait Economic Cooperation Framework Agreement (ECFA)", which is a milestone in the history of cross-strait relations, was determined to be signed by the leaders of the two sessions in the mountain city of Chongqing on June 29, "laying the anchor" for the normalization of cross-strait economic relations.

According to the agreement, the two sides will reduce taxes on 806 products originating in the mainland and Taiwan, and expand the opening up of some service industries to each other. What opportunities will the successful identification of ECFA bring to the footwear industry on both sides of the Straits?

Ignite the craze for shoe enterprises to be listed in Taiwan

It is understood that the main financing channels for mainland enterprises to go public in Taiwan are the first listing (IPO) and the second listing (TDR). The Taiwan Stock Exchange was established in 1962. In 1996, Taiwan opened the second listing (TDR) of foreign enterprises in Taiwan. In 2008, Taiwan opened the first listing (IPO) of foreign enterprises in Taiwan. As for the future trend of TDR after ECFA signing, Taiwan securities industry believes that: "ECFA signing will trigger the tide of mainland enterprises listing in Taiwan. In the next three years, it is expected that there will be 100 mainland enterprises listed in Taiwan's second listing (TDR). "  

The most attractive aspect of Taiwan's securities market is the low listing cost. It is reported that only written review is required for listing on the Taiwan stock market, and the listing process only takes six weeks. In addition, enterprises can refinance after listing, which is not subject to time restrictions. Cai Songqi, Executive Director of Anhou Jianye Certified Public Accountants and Executive Director of Taiwan M&A and Private Equity Association, introduced that the changes in Taiwan's securities market policies can be seen. In the past, enterprises listed in Taiwan were limited to those registered in Taiwan, and the place of registration, the place of listing and the place of operation must be three in one; Now, foreign enterprises are allowed to come to Taiwan for listing, and the three places are allowed to be different. As of May 31, 2010, a total of 18 foreign companies have issued TDR in Taiwan, which is the capital market with the largest number of TDR listings in the three mainland and Singapore capital markets.

Promote the complementary advantages of cross-strait shoe enterprises

"The biggest advantage of signing the Cross Strait Economic Cooperation Framework Agreement (ECFA) is to promote the complementary advantages of Taiwan enterprises and mainland enterprises, form a joint force, jointly face the competition in the world market, and expand the share of products in the world market." Ding Kunhua, chairman of the board of supervisors of the National Association of Taiwan Compatriots Investment Enterprises, said.

The advantages of Taiwan's shoe enterprises lie in product design, brand design, marketing channels and the ability to adapt to the development of international trade. The advantage of the mainland lies in its manufacturing industry and broad market. After the cross-strait economic cooperation framework agreement comes into force, Taiwan can save 13.8 billion US dollars in taxes alone, which will greatly improve the competitiveness of Taiwan's shoes, and Taiwan's enterprises will therefore gain greater development space.

Another advantage after ECFA signing is that the early receipt list includes the financial industry. Previously, financing was the biggest difficulty for Taiwan's enterprises to develop in the mainland. After the signing of the agreement, Taiwanese enterprises can participate in the mainland loan and RMB business in a short period of time, and increase the financing channels of Taiwan enterprises, which is conducive to the future development of Taiwan shoe enterprises.

The signing of ECFA also brings great development opportunities to mainland shoe enterprises. The semi-finished products from the mainland can be shipped to Taiwan. By using Taiwan's brand value, technical ability and marketing channels, the same products can be sold 15% to 20% more internationally, which will effectively improve the competitiveness of mainland products in the international market.

Opportunities outweigh challenges, and cooperation outweighs competition. The mainland is not only the world's largest factory, but also the world's largest market. Taiwan enterprises can develop targeted products suitable for the mainland market. He believes that Taiwan enterprises can take a place in the mainland market and even the international market by virtue of their design ability and brand advantages.

Promote the transformation and upgrading of processing trade of mainland shoe enterprises

Through the cross-strait tariff reduction items, it can be found that many areas of technology industries such as high-end components that are open to the mainland are relatively weak regions in the mainland, and also areas that the mainland needs to import from other countries. After zero tariff for Taiwan, the above fields are beneficial to the development of mainland industries. And Taiwan's opening to the mainland is almost Taiwan's own weakness, which needs the advantages of the mainland to make up. Industry insiders said, "The landing of Taiwan's advanced technology products, to a certain extent, has provided external impetus for the self improvement and progress of the mainland machinery industry, and promoted the mainland's shoe machine manufacturing products to become more sophisticated."

The majority of processing trade shoe enterprises will be cheaper to introduce advanced equipment, raw materials and other aspects in the future, which may reduce the operating costs of processing trade shoe enterprises to a certain extent, so that more profits will be invested in transformation and upgrading, which will promote the transformation and upgrading of processing trade shoe enterprises to a certain extent. From the perspective of shoemaking machinery alone, the quality of Taiwan's production is much better than that of the mainland. After the ECFA is signed, it means that these shoemaking machines will be cheaper, which will greatly benefit the quality improvement of the mainland's shoemaking machinery industry. To a certain extent, it has provided external impetus for the self improvement and progress of the mainland machinery industry, and promoted the mainland machinery manufacturing products to become more refined. "

The signing of the Cross Strait Economic Cooperation Framework Agreement (ECFA) is the most significant breakthrough in the field of cross-strait economic and trade cooperation over the past 60 years. It will help promote the exchange and development of shoe enterprises across the Straits.