the government to renegotiate terms with his group on a proposed
petrochemical complex in Taiwan. This US$2.2 billion project had been
stalled because of high land costs and environmental opposition.
In June 1992, the government finally approved Wang’s naphtha cracker
project in Mailiao (Yunlin county). Although the government declined to lift
its prohibition on the Haicang Project in China, it allowed Wang to increase
the size of the Mailiao project. Called Taiwan’s sixth naphtha cracker, the
US$9.5 billion project was three times larger than the earlier proposal.^61
A more recent case concerns a large conglomerate, the Chi-Mei group,
founded by Hsu Wen-lung in the 1960s. Hsu and his Chi-Mei group
maintained excellent relationships with politicians. His strong support for
Taiwanese independence helped him create a solid alliance with former
President Lee Teng-hui and the current DPP regime.
The Chi-Mei group is the world’s largest manufacturer of a plastic material
called ABS, and China is its major market. In 1996, the firm established a
petrochemical complex in Zhenjiang (Jiangsu Province). After planned
expansion, the conglomerate’s investment will total US$600 million;
production capacity will exceed that of the group’s Taiwan facilities.^62
The Chi-Mei group’s political tendencies prompted a backlash from China’s
leaders. After the re-election of President Chen Shui-bian in 2004, the
spokesman of the Taiwan Affairs Office of China’s State Council stated that
China did not welcome the ‘green Taiwanese businessman’^63 and called Hsu a
‘Big Shot’ supporter of Taiwan independence.^64
However, the deterioration of China’s relations with the Chi-Mei group
opened a new window for business in Taiwan. Shortly after the publication of
the ‘Green Taiwanese businessman’ editorial, Chi-Mei Optoelectronics signed
an agreement with 35 Taiwan banks for a syndicated loan of US$2 billion. The
institutions include large government banks such as the Bank of Taiwan,
Chang Hwa Commercial Bank, Chiao Tung Bank, Hua Nan Bank and others.^65
The loan will fund the construction of Chi-Mei’s plant in the Southern Taiwan
Science Park. The large bank loan redressed damages to Chi-Mei in China. By
locating its plant in Taiwan, the conglomerate demonstrated support for the
administration’s policy of ‘keeping roots in Taiwan’.^66
The cases of Formosa Plastics and the Chi-Mei group reveal another
dimension of cross-strait trade and investment. In addition to transferring
high-pollution industries and selling environmental technology to China, some
Taiwanese enterprises used investment projects in China to gain greater
domestic leverage in Taiwan. To persuade enterprises to ‘leave roots in
Taiwan’, the state offers preferential treatment and relaxes environmental
standards for enterprises that damage ecosystems. Formosa Plastics’ sixth
naphtha cracker project is a good example. Chi-Mei’s location of its new high-
tech project in Taiwan also hints at possible loopholes in environmental
152 Governance of biodiversity conservation in China and Taiwan