Taipei - Taiwan's cabinet Thursday approved a plan to allow qualified direct institutional investors (QDII) from China to invest 3 per cent, or up to 222 million dollars, of their net worth in the local stocks and futures markets.

The plan, aimed to prop up the sagging bourse on the island, was approved along with 10 public infrastructure projects by Premier Liu Chao-shiuan during a cabinet meeting, according to a Taiwan government news statement.

Lee Jih-chu, vice chairwoman of the Financial Supervisory Commission, said after the meeting that the percentage would be increased to 10 per cent if Taiwan and China are able to sign an agreement on financial cooperation next year.

"Due to the global financial tsunami, the net worth of 10 Chinese QDIIs allowed by the mainland for overseas investments has been reduced to merely 7.4 billion US dollars," she said.

But she stressed that although the amount was not huge, it would still help prop up the Taiwanese markets, especially after the global economy rebounds in the future.

Of the 10 projects approved by Liu, the cabinet said the government would spend a total of 9.2 billion dollars on them in a bid to help boost domestic demand and increase jobs. (dpa)