July 12 (Bloomberg) -- China’s government plans to allow Taiwanese to set up and run entertainment businesses on the mainland, an official said at talks between the two sides.

China is seeking to boost Taiwan’s entertainment industry by allowing greater access to the mainland market, the official Xinhua News Agency cited Minister for Culture Cai Wu as saying yesterday.

Taiwan’s cultural sectors, including broadcasting, news publishing and music, could take advantage of better cross- Strait links amid a slowing domestic market, Wu Poh-hsiung, chairman of Taiwan’s ruling Kuomintang party, said earlier.

Wu and Cai are in Changsha, central China, as delegates to the fifth annual cross-Strait talks, which have helped ease almost 60 years of tensions. Relations have improved since Taiwan President Ma Ying-jeou took office last year, pledging better ties with the mainland, its largest trading partner and biggest military and political threat.

“Taiwan’s entertainment industry is targeting the mainland because they consider it as a potential market to earn money,” said Andrew Yang, secretary-general of the Taipei-based Chinese Council of Advanced Policy Studies. “Many Chinese authorities may see the development as an opportunity to spread Beijing’s influence.”

Two-Day Summit

The two-day summit, which ends today, is focusing on development of cultural and educational links between Taiwan and China.

Taiwanese will be allowed to run performance venues in China through ventures with local companies or by funding venues themselves, Cai was cited as saying. Taiwanese entertainment brokerages will also be allowed to set up branches on the mainland, he said.

China also plans to allow Taiwanese cable-television networks to provide information services in Fujian Province, Tian Jin, deputy director of the State Administration of Radio, Film and Television was cited as saying.

Taiwan and China have been ruled separately since Chiang Kai-shek’s Kuomintang, or Nationalists, fled to the island after being defeated by Mao Zedong’s Communists in 1949. China regards Taiwan as part of its territory and has threatened to use force if necessary to reclaim it.

To contact the reporter on this story: Tim Culpan in Taipei at tculpan1@bloomberg.net.

Last Updated: July 12, 2009 00:37 EDT