China to Purchase $5 Billion of TFT-LCD Panels From Taiwan

China`s Taiwan Affairs Office of the State Council recently confirmed that Chinese companies would sign agreements with Taiwanese suppliers of thin film transistor-liquid crystal display (TFT-LCD) panel on January 20 to procure $5 billion of panel products from the island.

Yang Yi, spokesman of the Taiwan Affairs Office, said so at a recent press conference in China, with the signing ceremony to be held in Beijing.

In 2009, a delegation led by the China Video Industry Association (CVIA) consisting of eight major color TV makers in China visited Taiwan to place over $3 billion in orders for TFT-LCD panels.

According to Yang, China`s panel procurements from Taiwan are expected to help the TFT-LCD industry in Taiwan restore production capacity and even face a supply tension. Such moves, he added, have effectively upgraded Taiwan-made TFT-LCD panels` market share in China to 50 percent in 2009 compared to only about 35 percent in 2008.

The spokesman added that, since 2009, procurement delegations organized by various provincial governments, makers` associations, and big conglomerates in China have together purchased about $14 billion of IT, electronics, machinery, petrol-chemical, textile, processed food, and agricultural products from the island. Such procurements have effectively eased declining exports out of Taiwan since July 2009 to drive exports back to positive growth since November, Yang said.

An announcement by Taiwan`s Mainland Affairs Council of the Taiwan Cabinet, however, pointed out real differences from Yang`s statements, with China`s procurement delegations being part of cross-strait trade exchanges that benefit both sides rather than only Taiwan.

Source: CENS