Taiwan’s stock market has a rare chance to transform itself into Asia’s Nasdaq, as the island improves its relationship with China, while capital markets in the US and Europe are largely frozen because of the financial crisis, says the head of private equity group H&Q Asia Pacific.

Hsu Ta-lin, chairman and founder of the Palo Alto-based company, which has $2.6bn (£1.7bn, €1.9bn) under management, says venture capital firms like his are “finding it very difficult to exit [their investments] at the moment” because there is little investor appetite for initial public offerings in western capital markets, which were battered by the financial crisis.