XIAMEN, Sept. 8 (Xinhua) -- Taiwan authority were told to remove restrictions hampering financial cooperation across the Taiwan Strait and to allow local banks to set up business outlets in the Chinese mainland.

Vincent Yen, president of the Taiwan Council for Industrial and Commercial Development, said establishment of business branches by Taiwan banks in the mainland would not only rescue cash-strapped Taiwan-invested ventures out of their financial doldrums, but also help improve their competitiveness globally.

"I believe if they are allowed to operate on the mainland, Taiwan banks can also profit from the mainland's fast growing economy, and have their size of business and competiveness boosted," said Yen, who was here to attend the 11th China International Investment and Trade Fair, which opened in Xiamen City, Fujian province, on Saturday.

Taiwan authority has imposed many barriers to block off economic exchange and trade development across the Taiwan Strait.

One of its restrictions stipulates that investments made by Taiwan investors in the Chinese mainland should not exceed 40 percent of their respective net assets.

"With the restrictions in place, many Taiwan invested businesses -- mostly small and medium-sized enterprises -- on the mainland face difficulties in fund raising if they intend to expand scale of business," said Yen, "the financial difficulty has been caused as these businesses enjoy little fame and don't have adequate credit guarantee in the Chinese mainland."

Taiwan authority bans the banking sector to open operational organziations in the mainland.

"Without the platform of Renminbi business, financial organizations of Taiwan could not provide Taiwan investors with working fund needed by them to cover growing procurement from the mainland," said Yen.