Taiwan Taps Middle East Investors to Develop Its Bourse

As part of its plans to develop the local capital market into a global entity, Taiwan is looking to tap businesses in the Middle East, particularly from the oil rich GCC region, to invest into Taiwan Stock Exchange (TWSE).

TWSE Chairman and CEO Sherman Lin led a delegation to Qatar, Saudi Arabia and the UAE from October 11 to 19 to strengthen ties with institutional investors. The group met with local stock exchanges, sovereign wealth funds, asset managers and custodian banks in the three countries.

TWSE said that this strategic initiative was to engage with key institutional investors, the first since 2007, aimed to showcase Taiwan’s capital market strengths and growth potential as Taiwan’s market capitalisation has doubled to $2.24 trillion in September this year, Lin pointed out.

The stock market has surged this year, rising by 23.94% as of September 30, outpacing major global stock markets. Taiwan listed companies have reported significant increases in revenue and profits in the first half of 2024 compared to the same period last year, highlighting robust growth among local enterprises.

“Taiwan’s aggressive investments driven by AI innovation and the strong development of the local ETF market has contributed substantially to the market capitalisation increase,” Lin said.

He said that development of the local information and communication technology industry driven by demand for artificial intelligence, and the future launch of active and multi-asset exchange-traded funds, will attract more international investors.

“Sustained foreign interest has been a key driver behind Taiwan’s upward trend in stock prices and volumes with international investors maintaining ownership above 40% for ten consecutive months since November 2023, and trading volumes consistently exceeding 30%,” he added.

During his meetings with the industry captains, Lin explained the latest advancements in Taiwan capital market, particularly the surge in the AI industry this year, which has significantly boosted the market value and trading volume of Taiwan capital market.

He also shares Taiwan’s experiences in supporting fundraising activities for new economy industries in the capital market, particularly in the areas of exchange-traded funds (ETFs) and ESG performance.

Taiwan’s semiconductor industry, a cornerstone of the global AI supply chain, was also emphasised, positioning the Taiwan capital market as a focal point for international investors, he said.

TWSE’s Enters New Era

TWSE has entered into a new era in the capital market, and its liquidity of Taiwan stocks has steadily increased under the continuous improvement of market systems.

This year, the Taiex has reached 22,000 points with a daily average value exceeding NT$400 billion, and the trading value now ranks number 9 in the world. This milestone is a significant achievement based on the excellent fundamentals of Taiwan stocks and the steady development of ESG, as well as the joint efforts of the TWSE, listed companies, and investors. The rise in both price and volume, and the steady growth in the number of listed companies and participating investors have further increased the responsibility of the TWSE.

Looking to the future, the TWSE is committed tto developing the local capital market into an international-level capital marke, promoting both its safety and development, continuously guiding enterprises to enhance their governance capabilities, encouraging industrial innovation and development, enhancing communication with market participants, and achieving the goal of strengthening the value of Taiwan’s capital market. The TWSE will take the initiative to innovate through action, strive to strengthen the overall resilience of the capital market, actively respond to digital and net zero transformation, and seek the growth momentum for the new generation, in the hope to become the most solid backing for enterprises, and create a more resilient and innovative capital market together with market participants.