In recent years, the government has implemented a variety of policies to guide capital into Taiwan, paying close attention to the importance of developing asset management and wealth management for the prospects of Taiwan’s local financial industry. President Lai Ching-te has proposed to “allow new financial products to turn Taiwan into an Asian asset management center.” The Financial Supervisory Commission (FSC) has coordinated major policies by planning one-stop financial services, flexible capital utilization, cross-border financial services, and inter-institutional collaboration, aiming to build an Asian asset management center with Taiwanese characteristics on an implementation schedule of “tangible results in two years, transformation in four years, and success in six years.”

To track the views of financial professionals on the government’s asset management center polices, following its Q2 edition, TABF has completed its Q3 financial market survey. The results demonstrate attention to this initiative, with 80.8% of participants knowing about and supporting it, up from 65.3% awareness and 79.0% support in the previous survey. Furthermore, regarding the likelihood of success, “very high” (12.8%) and “high” (43.0%) added up to 55.8% of respondents, up from the 51.5% in the previous survey. Based on these observations, respondents continue to focus on policies to “promote sustainable green finance” (62.1%) and “establish the Kaohsiung Asset Management Zone” (56.3%).

More importantly, attention to “Taiwan Individual Savings Accounts (TISA)” (44.4%) and the “Kaohsiung Asset Management Zone” (56.3%) increased significantly compared to the previous respective results of 16.9% and 31.4%. This is related to the relevance of these measures to the interests of financial customers, continuing policy advocacy, and announcements by domestic and international firms about entering the Zone.

Specifically, the respondents still considered “convenient cross-border capital flows” (65.1%) and “global product diversification” (64.9%) to be helpful for the Asian Asset Management Center policy, with higher approval ratings than in the previous survey. Finally, respondents continue to believe that “talent and professional competency” (66.7%) needs to be strengthened for the successful development of an Asian Asset Management Center. “Regulatory and legal deregulation” (61.5%) demonstrate a significant increase from the previous result (55.7%), moving to the second place, while “government efficiency and policy stability” (61.2%) declined slightly to the third place. Additionally, “tax incentives” (58.8%) increased greatly from the previous result (51.1%), demonstrating hopes for regulatory and legal deregulation, as well as tax incentives.

Figure 1: Asian asset management center promotion measures (multiple selections allowed)

Source: TABF

*percentages (%) represent the portion of respondents who chose each option.

From these results, many coordinated policies promoted through the central government, local authorities, and industry players have attracted the attention of financial institutions – yet this is just the beginning. The respondents are interested in future opportunities from the return of high net-worth clients back to Taiwan. To what extent will they accept Taiwan’s new service offerings? Will they really be interested in establishing an asset management center in Taiwan? Or what incentives would attract them to stay in Taiwan? Repatriating investment has to be more than just a slogan.

Would operations really be more convenient and advantageous if clients who chose to establish themselves over the past several years in order to comply with the Common Reporting Standards (CRS) to demonstrate substantial economic activity moved back to Taiwan’s offshore financial center? Would they be able to maintain their tax status? These are the practical questions clients must consider. From the government’s perspective, meanwhile, even if the return of funds to Taiwan does not generate significant tax revenue, from the perspective of financial industry development, growing Taiwan’s asset management would create internationally-competitive jobs, with long-term benefits for Taiwan’s financial industry.

Moreover, Taiwan lacks forward-looking industrial planning, which is an area where Singapore’s example could provide guidance. For example, while many investors still contemplating alternative assets like real estate and infrastructure, Singapore has long set its sights on crypto assets with promising future prospects, taking full advantage of Know Your Customer (KYC) procedures to alleviate concerns about money laundering and terrorist financing, to develop crypto asset trading and custody services. Although crypto assets are less appealing for elderly high net-worth clients, younger clients consider them to be key asset allocation items. New types of crypto assets, like stablecoins, will probably become a transaction medium for commercial clients, even bypassing traditional banking financial systems for cross-border transactions. How can traditional banks adapt to these changes?

In order to assist financial institutions to expand their business and strengthen professional talent development, TABF has launched the Asian Asset Management Center Talent Development Program, integrating both domestic and international training resources. Designed for entry-level, intermediate, and advanced professional personnel, the current courses cover core topics like asset allocation, high net-worth client services, market research, and product development. In addition to domestic experts, the program has invited practitioners from the United States, Singapore, and Hong Kong to share their experiences, and also incorporates hands-on Bloomberg courses. The current curriculum references international standards as the basis for competency assessment.

Looking ahead, meanwhile, TABF will continue to deepen collaboration with industry and government to strengthen international connections and comprehensively enhance financial professionals’ expertise and international vision, helping financial institutions to improve their competitiveness, further accelerating Taiwan’s development as an Asian asset management hub, and creating new opportunities for sustainable development of the industry.

The author is Associate Editor-in-Chief of the Taiwan Banker