Taiwan's restrictions on investment by its companies on the mainland have been a failure and the government will soon introduce measures to liberalise cross-strait business ties, says the island's top economic policymaker. Hu Sheng-cheng told the Taipei Foreign Correspondents Club yesterday that debate persists within the administration of Chen Shui-bian over the long-standing restrictions on how Taiwanese can invest in mainland China, but that a trend towards liberalising existing investment curbs had clearly emerged. 'Restrictions on investment in China have not worked,' said Mr Hu, a minister and member of the Taiwanese cabinet. Taiwan's cabinet is divided among hawks who still see barriers to trade and investment as important safeguards against China's power and doves who want to see faster liberalisation in the economic relationship. An economic ministry panel has been reviewing restrictions, including rules on investment in semiconductor fabs, but has yet to give a recommendation or a timeline on when a report might be delivered. Mr Hu said he was confident liberalisation would be realised. 'I believe in the future we'll be moving toward more openness ... under so-called effective management,' he said, but admitted that the pace of liberalisation would 'not [be] at the speed people would like'. Taiwan instituted a 'no haste, be patient' policy on mainland investment following Beijing's 1996 missile tests in the Taiwan Strait but that policy was changed to 'active liberalisation and effective management' in 2001. To offset the risks of accelerated economic integration with China, Taiwan's Council for Economic Planning and Development (CEPD) recommends a market diversification strategy, which includes enhanced business ties with Asean countries and the signing of a free trade agreement with the US. Aside from the geo-political worries over the transfer of capital and technology to the mainland, another key concern with eased investment restrictions is the export of jobs. CEPD figures show that factory jobs in Taiwan have increased for three successive years, with manufacturing growth outpacing GDP growth over the period. 'We've been talking about hollowing out for more than 20 years but the fact is manufacturing remains strong,' Mr Hu said.