China Shipbuilding chairman will resign

The head of the state-owned China Shipbuilding Corp (中船) said yesterday that he wants to resign for health reasons and he expressed the hope that there will be no random speculation on his reasons for quitting.

China Shipbuilding chairman Hsu Chiang (徐強) said that he recently told Minister of Economic Affairs Lin Yi-fu (林義夫) about his desire to return to his teaching job at National Cheng Kung University in Tainan, southern Taiwan.

"[I wish to resign] for the simple reasons that I have high blood pressure and have accomplished my mission at this stage," Hsu said, referring to his part in bringing the company's revenue from red into the black, as well as his hand in helping with the company's approaching goal of privatization.

Hsu denied reports that he was bailing out of the company or that there were political considerations behind his decision.

He was responding to reports speculating that as a second-generation mainland Chinese, he is worried about having to take sides in next year's presidential election.

A Chinese-language newspaper also claimed that a policy to build submarines for the nation's military -- which has not received clear support from the government -- coupled with an as-yet-realized promise by the Executive Yuan to appropriate NT$2 billion (US$59.3 million) to improve the financial structure of the China Shipbuilding have also contributed to discouraging Hsu and making him want to return to teaching.

The reports noted that the China Shipbuilding is being privatized and is scheduled to sell its Keelung and Kaohsiung plants, and that MPH, a consortium of arms manufacturers in the US, is interested in bidding for the Kaohsiung plant and is sending an official to Taiwan this week to discuss the matter with the China Shipbuilding.

Hsu said that this May he had been extremely busy and that he was preoccupied with communications with the MPH and other parties interested in investing in the China Shipbuilding. Because of time zone differences, he often had to work at night, which caused his blood pressure to shoot up dramatically.

Vice Premier Lin Hsin-i (林信義), who concurrently serves as the chairman of the nation's top economic agency, the Council for Economic Planning and Development, said that Hsu had expressed his wish to return to teaching several months ago, but said the ministry which is in charge of administrating all state-owned enterprises, is hoping to "retain him as best we can."

Last year, the shipbuilder was involved in a fraud scandal that led then-chairman Yu Chen-nan (余辰南) to step down. Hsu was invited to take over his job and he vowed at the time to get the company out of the red quickly.

Statistics provided by the Commission of National Corporations show that the accumulated losses of the China Shipbuilding reached NT$11 billion at one time and the company was on the brink of bankruptcy in 2001. After the implementation of a rejuvenation plan, the China Shipbuilding turned the corner last year, recording pre-tax profits of NT$350 million.

Since international shipping is on the rebound, the China Shipbuilding has earned profits of nearly NT$300 million in the first eight months of this year, and is forecast to record profits of NT$360 million for the whole year.

Orders for new vessels have reached more than 40, which will keep the company fully booked until 2007.