China agrees 10-point plan to help Taiwan in financial crisis

The 10 measures include loans for Taiwan-owned businesses by Chinese state-owned commercial banks, support for small and medium- sized Taiwan-based companies and the promotion of bilateral investment.

Wang Yi, the party's top official for Taiwan affairs, announced the measures at the end of a two-day economic forum organized by the Communist Party and Taiwan's ruling Kuomintang (KMT or Nationalist) party in Shanghai.

The measures were "aimed at jointly coping with the global financial crisis," the official Xinhua news agency said.

Taiwan-based small and medium-sized firms would be eligible for the same government support given to their mainland counterparts, the agency said.

The Chinese government would also support the participation of Taiwan-backed ventures in its package of infrastructure and other projects designed to stimulate domestic demand in the face of the financial crisis.

The Bank of China and the Industrial and Commercial Bank of China would offer loans totalling 50 billion yuan (7.3 billion dollars) each for financing Taiwan-funded enterprises over the next two to three years, the agency said.

The China Development Bank would also double its planned backing for Taiwan-funded enterprises over the next three years from 30 billion yuan to 60 billion yuan.

The government would support restructuring and modernization of Taiwanese-funded firms, and promote closer industrial cooperation between the two sides, Wang said.

The two sides would jointly promote the development of flat-panel display screens, explore cross-Strait agricultural cooperation, and China would allow Taiwanese lawyers to work on the mainland, he said.

Wang's offer of cooperation through the financial crisis comes amid warming ties between the two sides.

Speaking at the forum on Saturday, KMT chairman Wu Poh-hsiung said the improvement in relations was a result of "courage and determination" by the two parties in recent years.

More than 400 people from the two parties and leading businesses attended the forum.

Last week, the two former civil war enemies opened direct flights, shipping and postal links.

Taiwan had banned direct sea, air and trade links with China in 1949 after the Nationalists lost a civil war with the communists and fled to Taiwan to set up their government-in-exile.

The six-decade ban on trade links has severely hurt Taiwan's economy.

The damage is increasing as China becomes the locomotive of the world's economy and foreign countries step over Taiwan to deal directly with China.