China-based Taiwanese businesses warned of tense U.S.-China relations

Taipei, Feb. 21 (CNA) The Straits Exchange Foundation (SEF) warned Taiwanese businesses in China Wednesday of collateral damage they could sustain as U.S.-China relations deteriorate, urging them to be cautious and vigilant.

The SEF is a semi-official organization set up by the government to handle technical and business matters with the People's Republic of China.

SEF Chairman Tien Hung-mao (田弘茂) said at an event for China-based Taiwanese businesses that a bad relationship between the two world powers could result in a confrontational trade relationship, which could hurt the operations and interests of Taiwanese businesses in China, especially those in the export industry, Tien said.

The origin of the tense U.S.-China relations seems, according to Tien, to be a Section 301 investigation that U.S. President Donald Trump initiated in August 2017 into China, regarding intellectual property (IP) rights and technology transfers.

China, which has been accused of multiple violations of IP rights, has expressed strong dissatisfaction with the investigation, according to The Diplomat, a current affairs magazine for the Asia-Pacific region.

U.S.-China relations could deteriorate should the U.S. decide to impose sanctions if the Chinese violations are proven, Tien said.

He urged Taiwanese businesses to take note of the changing landscape influenced by China's foreign affairs relations, as well as its policies on trade, finance and environmental protection, and to respond with appropriate management and operational changes.