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Foreign Investments: Forget the mainland, Taiwan’s your best bet in China

Posted April 1, 2008

“Taiwan is much richer than China – its per capita Gross Domestic Product is $29,800 (calculated on a purchasing power parity basis), which is closer to the levels prevailing in Western Europe rather than China’s per capita GDP of $5,300.” — Martin Hutchinson

Blogger’s note: Taiwan is more stable, richer and has lower inflation than China. And Martin Hutchinson gave his Money Morning readers four free stock picks to pull gains from the island while they watch mainland China drop stock value in the coming volatile months. You can find Martin’s article here or read on for more.

by Martin Hutchinson

Baltimore – (TFN): Taiwan is the China investors should be focusing on.

Investors in Taiwan got good news last week when the party that favors closer relations with China won the Taiwanese presidency. The win by Ma Ying-jeou of the Kuomintang party sent the Taiex Index up 4% in one day.

The win reduces the risk to Taiwan investments of invasion by the million-strong Chinese Red Army, and it’s always good in these troubled times to see a risk being reduced!

Taiwan is an active democracy, making it a more stable pick for investors. The Kuomintang party is taking over after eight years of rule by the Democratic Progressive Party (DPP).

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He “Retired” at 43… But He’s Still Making People Rich

The last few months have been treacherous for investors. Oil has spiked. The housing market has rolled over. A stubborn credit collapse has driven fears of recession or ruin. And most stock market investors have taken it on the chin.

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And Taiwan is much richer than China – its per capita Gross Domestic Product is $29,800 (calculated on a purchasing power parity basis), which is closer to the levels prevailing in Western Europe rather than China’s per capita GDP of $5,300.

Inflation is under control in Taiwan. It’s currently at 1.8% compared to China’s 8.5% – and the United States’ 4.3%. It has $300 billion in international reserves, and very little foreign debt, which cushions the country from being heavily affected by any Western “liquidity crunch.”

Taiwanese productivity has consistently grown at more than 4% per annum, more than double the rate in the United States and Western Europe, and its GDP increased 5.5% in 2007 and is expected to grow around 7% in 2008. Read on to discover four hot stocks (one index, two ADRs and a Pink Sheets pick) from Taiwan’s thriving economy.

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Posted by Martin Hutchinson · Filed Under International Investing 

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