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BES wants government to pay it back

Some 300 shareholders of BES Engineering Corp (中華工程), a major builder of industrial parks for the government, are scheduled to stage a protest in front of the Ministry of Economic Affairs today, BES senior vice president Shen Hwa-yeang (沈華養) said yesterday.

Protesters plan to demand the government reimburse NT$19 billion that BES spent on construction of several industrial parks in Taiwan on behalf of the government beginning in 1978, Shen said.

Shen said before the company was privatized in 1994, the state-run BES was commissioned by the ministry's Industrial Development Bureau (IDB) to help develop industrial parks around the country.

With governmental backing, BES secured loans from domestic banks to purchase land and undertake construction work on several complexes including Ilan County's Lize Industrial Park (利澤工業區), Changhwa County's Changpin Industrial Park (彰濱工業區) and Yunlin County's Technology Industrial Park (雲林科技工業區).

These projects cost BES a total of NT$19 billion ? including some NT$4.6 billion for land acquisition, NT$7.1 billion in construction fees and NT$6.2 in interest payments, as of the end of July.

Shen said the company was profitable until the 1997 Asian financial crisis struck and interest in industrial parks waned. The parks have fallen on tougher times since the economy turned sour last year, with manufacturers increasingly relocating across the Taiwan Strait.

With its balance sheet in the red, the company began to negotiate with the government over the reimbursement of NT$19 billion in 1998, but the two failed to come to terms.

Yesterday, BES Chairman Sheen Ching-jing (沈慶京) called on officials to take responsibility.

"The rascal government can't evade proposing a reasonable timetable for paying up our debts at the expense of [the corporation's] 120,000 shareholders," he said.

"The company continually pays monthly interest payments of NT$120 million," Sheen said, adding that the burden has greatly overshadowed the company's performance in the stock market, with its stock price declining to NT$2.29 per share yesterday.

In rebuttal to Sheen's accusation, the IDB Director-General Chen Chao-yi (陳昭義) yesterday said that the government has nothing to do with the corporation's debts.

"The dispute remains between BES and banks. What the government can do is to help bring down land rentals at industrial parks [to attract investors]," Chen said.

But BES yesterday insisted that the government was responsible for the loans before and after the company's privatization.

Hsiao Jui-huang (蕭瑞煌), deputy general manager of BES's property development department, yesterday said he hoped that "during these financial tough times that the government can give us a hand since we contributed a lot to the nation's economy."

BES has NT$13.6 billion in assets and NT$6.9 billion in revenues, he said.

Hsu Sung-ken (許松根), an industry economist at the Academia Sinica, said yesterday that the government should "shoulder the responsibility and pay up."
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