TAIPEI: Negotiations toward greater co-operation in financial supervision will go forward unimpeded and unaffected by the imminent "cabinet" reshuffle, a senior official said yesterday.

"Negotiations on the signing of a financial MOU (Memorandum of Understanding) across the Taiwan Straits have been proceeding as scheduled and are expected to bear fruit by the end of this year," said Lee Jih-chu, vice chairwoman of the Financial Supervisory Commission.

Speaking on the sidelines of a seminar on bill financing markets in Taiwan and on the mainland, Lee said the "cabinet" reshuffle would not hold back progress on the pact.

"Talks have proceeded smoothly toward the goal and have not lagged behind the set schedule," she added.

The signing of a financial MOU would enable Taiwan and the mainland to cooperate in supervising financial institutions, set up a cross-Straits currency clearance and settlement mechanism, permit commercial banks to exchange currency and work together on developing technologies to spot counterfeit notes, and allow financial institutions to establish branches in each other's market.

Taiwan's Straits Exchange Foundation (SEF) is eager to move forward with the MOU.

SEF Chairman Chiang Pin-kung said last week Taiwan's business community operating on the mainland has suffered a double blow in the global economic crises coupled with the stricter investment climate on the mainland.

The result has been that businesses now face increasing difficulties obtaining loans and upgrading corporate facilities. At the same time they face ever growing taxation, Chiang said.

"The signing of the MOU will not only help Taiwanese businessmen gain greater access to loans and restructure their operations, it will also contribute to the mainland's economic development," Chiang told a delegation from the Bank of China.

Li Lihui, president of the Bank of China, said he hoped that the bank would become the first mainland banking institution to establish a branch in Taiwan after the two sides forge the MOU on financial supervisory co-operation.

"Once a branch is set up in Taiwan, the Bank of China can build closer ties with leading Taiwanese businesses and offer better credit services to Taiwanese companies operating on the mainland as well," Li added.

Li and his group made a donation of NT$900,000 ($27,356) to victims of Typhoon Morakot, which battered southern Taiwan in early August and claimed the lives of more than 600 people.

Members of Li's delegation include Wang Zhaowen, director of the head office of the Bank of China, and Wang Lijun, president of the Bank of China's Overseas Operations Administration.

The group is visiting Taiwan at the invitation of ChinaTrust Commercial Bank.

China Daily/CNA

(HK Edition 09/09/2009 page2)