Focus Taiwan App
Download

Export sanctions to be updated and impacted firms helped: MOEA

02/28/2024 07:22 PM
To activate the text-to-speech service, please first agree to the privacy policy below.
A machine tool. Photo taken from Unsplash
A machine tool. Photo taken from Unsplash

Taipei, Feb. 28 (CNA) Taiwan's entity list is to be updated following a review by a cross-ministerial committee in early April to ensure the list is in line with international export sanctions on Russia, according to the Ministry of Economic Affairs, which also promised more subsidies for the country's machinery industry which has been negatively impacted by the restrictions.

The U.S. recently announced its largest package of sanctions against Russia, totaling 500 individuals and entities. The European Union also issued its 13th sanctions package last week, which not only increases the number of sanctioned entities but also prohibits the export of key components for drones to Russia.

Taiwan's entity list has so far banned 1,900 military-related Russian entities from receiving Taiwanese-made high-tech goods, according to the MOEA's International Trade Administration.

An MOEA official said the ministry continues to reference the practices of allied countries and undertake rolling reviews of the entity list.

The recently expanded sanctions issued by the U.S. and the EU target machine tools, automobiles and drone components, but the adjustment is expected to have little impact on Taiwanese manufacturers, the official said.

The official explained that Taiwan's supply chain is only involved in some of the expanded targeted industries, adding that Taiwan has also been closely observing international sanctions.

The most recent update was the MOEA announcement in early February adding 77 items to the list of machine tools restricted from being exported to Russia and Belarus, which is set to take effect on March 8.

The MOEA official acknowledged that the export restrictions have a negative impact on Taiwan's manufacturers of machine tools, machinery and machine components, as Taiwan's export to Russia fell 35.1 percent from 2021 to US$850 million in 2022 and to US$790 million in 2023. Exports to Russia in January totaled US$62.51 million, representing a further year-on-year decrease of 12.5 percent.

Taiwan Association of Machinery Industry chairman Larry Wei (魏燦文) on Tuesday said the restrictions on exporting machine tools to Russia and Belarus have benefited Chinese manufacturers. Wei made the comment when asked by reporters about the expanded sanctions at an event held by the association.

Wei added that the export of Chinese machine tools to Russia increased 60 percent in 2023, compared to a year earlier.

"This is giving away the market to China for free," the chairman said, lamenting the losses caused by political factors and calling on the government to provide subsidies or other support measures.

The machinery industry has also been battered by other factors including the exchange rate of the Taiwan dollar to the U.S. dollar.

The Japanese yen has depreciated 12 percent recently against the greenback, making the new Taiwan dollar relatively strong and affecting the industry's competitiveness in overseas markets, Wei said, hoping the rate will remain at NT$32 against the dollar.

Wei agreed that a rise in electricity prices is required for Taiwan Power Co. to not remain permanently in the red, adding that it is the industry's responsibility to actively pursue new ways to use power more efficiently and go green.

An official with the MOEA's Industrial Development Administration told CNA that the ministry has earmarked NT$300 million for the machine tool industry to focus on high-value and de-carbonized operations.

About NT$200 million will introduce smart machinery, and another NT$100 million be used to develop domestically made high-value machine tool controllers and product category rules (PCR) - which provide product category-specific guidance to assess the environmental impact of a product's life cycle and conduct carbon footprint calculations, according to the official.

(By Liu Chien-ling, Chung Jung-feng, and Alison Hsiao)

Enditem/AW

    0:00
    /
    0:00
    We value your privacy.
    Focus Taiwan (CNA) uses tracking technologies to provide better reading experiences, but it also respects readers' privacy. Click here to find out more about Focus Taiwan's privacy policy. When you close this window, it means you agree with this policy.
    172.30.142.45