Yesterday, the founder and CEO of Shanghai-based Semiconductor Manufacturing International Corp (SMIC) expressed his disappointment in Taiwan authorities' attempts to restrict business across the Straits.

"Some Taiwanese authorities have been restricting and persecuting us for our development on the mainland, and I feel quite a bit of disappointment about that," said Richard Chang.

"I am a US citizen but grew up in Taiwan," he added, "I was educated and served in the army in Taiwan, for which I have a deep affection."

The Economic Daily News reported that Chang applied to renounce his Taiwan residency status last month after doing business on the Chinese mainland left him facing sanctions from the island's authorities.

While not addressing his application directly, he said he hoped Taiwan's authorities would create a fair environment for competition.

"I welcome my Taiwan counterparts to come to the mainland and develop the semiconductor industry," Chang said. "If the policy of the Taiwan local administration allows, I am willing to be the strategic partner for my Taiwanese counterparts."

Taiwan authorities dealing with affairs external to the island province said in March that Chang illegally invested in SMIC in 2000. He was fined NT$5 million (US$150,000) and was required to withdraw his investment in the company.

Tight restrictions are imposed by the island's authorities on its semiconductor industry and on those seeking to invest in mainland companies with regard to how and when it can be conducted.

Chang was given six months to withdraw his investment, and if he fails to do so he could be given further penalties. He is currently fighting the case.

"Taiwan is trying to fine our CEO NT$5 million (US$150,000) for alleged improper investment in SMIC," Jimmy Lai, SMIC spokesperson, was quoted as saying by the International Data Group News Service in response to questions about why Chang was seeking to give up his link to the island.

Wu Xianfeng, a semiconductor analyst with Guotai Jun'an Securities, said the fine was insignificant to Chang, but he had reacted strongly because he thought Taiwan's authorities were being unreasonable.

"The investment trend from Taiwan in the mainland's high-tech sector cannot be blocked," said Wu, adding that the dispute would not impact on SMIC's business.

(China Daily August 26, 2005)