Taiwan's high-technology industry should benefit significantly from China's membership of the World Trade Organisation, a McKinsey study predicted.
WTO rules require mainland China and Taiwan to lift their limitations on foreign investment and the study said that Taiwanese manufacturers should soon be able to invest directly in Chinese businesses. Moreover, as Chinese tariffs on high-tech products fall, their exports to the mainland are likely to increase. In 2000, Taiwanese companies held 50 per cent share of the world production of laptops and 84 per cent of motherboards.
These changes are likely to encourage the creation of a more efficient Greater China supply chain, which would reduce overall manufacturing costs. Only a few foreign companies have their own factories in Taiwan for manufacturing high-tech goods, but they do buy significant quantities of these products from Taiwan for goods sold in their home markets.