TAIPEI (Taiwan News) — Investments by Taiwanese businesses in the Association of Southeast Asian Nations (ASEAN) exceeded investments in China for the first time in 2021, reports said Tuesday (Dec. 11).

The shift occurred amid the reorganization of supply chains, the COVID-19 pandemic, and the fallout from the trade war between the United States and China, NOWnews reported. The Taiwanese government has encouraged businesses to invest in 18 nations in the Indo-Pacific region through its New Southbound Policy launched in 2016.

Vietnam, Thailand, and India were reportedly the three most popular investment destinations. Vietnam already has at its disposal an advanced electronics sector comparable to China's, and it also offers competitive wages, a sizable domestic market, and a range of trade agreements with other countries, the report said.

During the period of January to October 2021, Taiwan invested US$5.3 billion (NT$146.68 billion) in ASEAN member nations, or 38.7% of the country's total overseas investments, the highest proportion in 20 years. Analysts predict that if travel restrictions end once the COVID-19 pandemic is over, Taiwan's exchanges with Southeast Asia will grow even more frequent.