TAIPEI (Taiwan News) — Taiwan is cutting off funds to China, including loans for businesses, investment, and interbank use, according to Forbes.

The business magazine based its figures on Taiwan Financial Supervisory Commission figures released on Friday (Nov. 18). These showed that banking industry loans to China fell by 16% in September.

Financial exposure to China was said to have declined by NT$234 billion (US$7.5 billion) to NT$1.19 trillion year-on-year. The reasons given for the fall in funding were a slowing Chinese economy and military tensions between the two countries.

Meanwhile, Insurance Journal, reported that “total exposure to China at Taiwanese banks, insurers and securities firms” had plummeted by 20% to around NT$1.35 trillion (US$43.25 billion) in the same time period. It said insurers had scrapped 40% of their investments in China to manage risk.

Insurance Journal quoted FSC Banking Bureau Director-General Sherri Chuang (莊琇媛) as saying, “Banks are more conservative on China’s economic outlook.”

Forbes cited Taiwan government figures in saying the nation is one of the biggest investors in China, having approved US$200 billion of funding for projects since 1991.

However, in recent years, the central government has been urging the country’s financial institutions to reshore, reinvest in Taiwan or follow the New Southbound Policy and put money into neighboring, friendly nations instead of China.