Task force on agricultural finance to go ahead: COA

The Cabinet-level Council of Agriculture (COA) has decided to move ahead with a plan to manage grassroots financial institutions by creating a 30-person finance division which will oversee the sector's financial affairs, including the proposed national agricultural bank, officials said yesterday.

"We'd like to recruit experts with a background in both agriculture and finance [to work at the division] to supervise farmers' and fishermen's credit cooperatives," Chiu Yung-chung (邱湧忠), director-general of the farmers service department at the COA, said yesterday at a press conference.

The council is also studying an alternative plan to expand the proposed division into a bureau and hire more staff, Chiu said.

A final decision is expected after the legislature passes the agricultural financial law (農業金融法), which is currently under review. The current legislative session ends on May 20.

After a demonstration against grassroots banking reforms by more than 100,000 angry farmers and fishermen last November, the Cabinet charged the COA with managing the agricultural sector's financial affairs. The Ministry of Finance previously oversaw the ailing sector. The reforms were drafted after the sector reported a non-performing loan ratio of 21 percent last year.

The central government's policy reversal triggered strong opposition from academics, who argued that the COA is ill-prepared to take over the job due to its lack of financial expertise.

But Chiu yesterday insisted that the council will have no problem recruiting financial talent from other government agencies including the central bank and the Ministry of Finance.

The planned COA finance division will adopt a "parallel cooperative relationship" with the yet-to-be-established Financial Supervisory Board (金監會), Chiu said.

To show its goodwill toward disadvantaged farmers and fishermen, the council yesterday launched a promotional campaign to inform the agricultural sector that complaints raised during the November protest have been addressed, Chiu said.

The government has spent NT$7 million on TV commercials and the printing of 600,000 pamphlets to persuade the nation's 709,000 farming households that it is looking out for their interests.

"The government hopes to reinforce its partner relationship with the agricultural sector," Chiu said.

The pamphlet tells farmers that the central government has agreed to allocate NT$150 billion within 12 years to fund agricultural development, and NT$100 billion within three years to compensate for losses due to agricultural importation changes in accordance with the nation's agreements to join the WTO.

A national agricultural bank is expected to be established as planned following the passage of the agricultural law, which stipulates that bankrupt credit units can only be taken over by other credit cooperatives rather than commercial banks.

Saying his group is "70 percent satisfied with the government's efforts," Chan Chao-li (詹朝立), chief officer of Taiwan Agro-Fighters United (全國農漁會自救會), yesterday expressed hope that the government will make implementation of the policies a top priority.

Chan also reiterated the agricultural sector's hope the the government would increase its share of funding for the proposed agricultural bank from 20 percent to 49 percent -- a decision to be finalized by the legislature.