Beijing has left no doubt that it regards telecommunications as a strategically important sector of the economy. Its veto in 2006 of foreign bids for prime assets of Hong Kong's PCCW is evidence of that. Seen in this light, the planned purchase by China Mobile of a 12 per cent stake in leading Taiwanese telecoms service provider Far EasTone takes on added significance. The deal may not be comparable in scale, but there is no doubting the potential political sensitivity of the move by the world's largest mobile carrier measured by users. It came the same day as an important landmark in the rapid progress on cross-strait relations - Taiwan's readmission to the World Health Assembly with observer status, made possible by Beijing's blessing. Derision of this breakthrough by Taiwan's pro-independence opposition as a reward for government concessions to Beijing's one-China policy is understandable sour grapes, given its own failure to achieve it when in power. The China Mobile deal, however, can be expected to arouse serious opposition that will not be so easily dismissed. As the first direct investment on the island by a mainland state-owned company, it will be portrayed by pro-independence forces as a signal of Beijing's intention to increase its political and economic influence by stealth. The required regulatory and shareholder approval is therefore bound to spark bitter debate. Politics aside, there is a strong argument that mainland investment is in the best interests of Taiwan, whose economy has been badly hit by the global financial crisis. The mainland's rapid growth sparked one-way economic traffic that sapped Taiwan's investment and entrepreneurial strength, exacerbating the effects of the global downturn. Warmer relations between Beijing and the Kuomintang government led by Taiwanese President Ma Ying-jeou have paved the way for closer economic and social links and the lowering of trade and investment barriers. China Mobile's HK$4.07 billion offer is expected to start a flood of deals on the island, under new laws allowing mainland companies to invest in Taiwan. This will help restore the balance and breathe life into the economy. But if Mr Ma is to reap the political dividend, the process must be managed carefully so that it does not move forward too quickly for the many Taiwanese who remain staunch supporters of the pro-independence Democratic Progressive Party. That would reassure them that a growing mainland stake in Taiwan's economy, along with recognition of official standing in the World Health Organisation, is evidence of good intentions.