When Chiang Pin-kung, vice-chairman of the Kuomintang, Taiwan's largest opposition party, visited China last week and reached a “consensus” on improving economic ties, he was applauded by Taiwanese investors. They felt the KMT clearly shared their vision one of Taiwanese companies flourishing in China.

A week later Taiwan's government has shown its displeasure at the KMT's unauthorised overtures to Chinese leaders by taking steps to make sure that vision will remain a distant reality for those businesses that have not yet moved into the mainland. Chen Shui-bian, Taiwan's president, has pledged to cool the “China fever” incited by Mr Chiang's visit. The government has few illusions that it can improve its poor record on punishing businesses that circumvent its rules on China investment. “There is little we can do to keep companies from pouring funds into China,” says Chang Min-pin, deputy executive secretary of the Investment Commission. “The political significance of the president's pledge by far exceeds the economic one.”