Fri, Aug 27, 2004 - Page 11 News List

Lin using morals against KMT

Minister of Finance Lin Chuan yesterday talked to `Taipei Times' staff reporter Amber Chung about the difficulties involved in retrieving property from the Chinese Nationalist Party (KMT) and his determination to add momentum to financial and tax reforms

Minister of Finance Lin Chuan discusses the legal twists and turns involved in retrieving the Chinese Nationalist Party's (KMT) disputed assets yesterday.


Taipei Times: It appears that the government has not successfully reclaimed any of the KMT's disputed property since the formation of the five-member task force in December. What are the major problems and difficulties?

Lin Chuan (林全): The biggest difficultly we met is that there are no laws governing the process of asking the KMT to return its disputed assets. The KMT's massive assets is an abnormal phenomenon that originated in the old times of single-party rule and is now providing an unequal footing for party competition.

We submitted a draft statute governing the handling of political parties' improperly acquired property to the Legislative Yuan [in September 2002], which could lend us legal basis for the issue if the draft is passed in the near future. But until the bill has been ratified, we simply have to resort to moral persuasion to get our job done.

TT: How has the KMT responded to such a soft approach?

Lin: They responded to our demands, but just not sincerely enough. The KMT has tried to limit its obligations by arguing that it would only return assets that are currently registered under the party's name, but not the profits resulting from the sale of disputed property. In the meantime, they are planning to sell disputed assets that still belong to the party, hoping to dodge more responsibility. For example, the KMT has [in May] sold the Hsinsheng Cinema (新生戲院) [in Ilan County], one of the five theaters it has promised to return to the state, without any prior notice.

And now they are trying to sell the party-run Hua-hsia Investment Holding Co (華夏創投) [through which the KMT controls a 65 percent stake in China Television (中視) and a 96.95 percent stake in the Broadcasting Corporation of China (中廣), a radio station that occupies 25 percent of the AM frequency band and 13.96 percent of the FM frequencies available to radio stations], and we were not informed until the newspapers reported the fact.

These deals all involve assets that have been designated to be returned to the government. We think that the party should express its sincerity by either halting the sale of these properties or clarifying how it will return the money obtained from the sale of the assets.

TT: The finance ministry's data released earlier this month showed that the KMT's assets were valued at NT$19.5 billion (US$573 million), which is much lower than the public's estimates of hundreds of billions of NT dollars. Are the actual assets really worth much less than previously thought, or has the KMT gotten rid of most of it?

Lin: The NT$19.5 billion re-presents the government's assessment of the value of real estate the party has acquired [since the Japanese left Taiwan in 1945]. Some of these assets have been sold or transferred and the profits gained from these transactions have been reinvested. But the problem is that it is hard to trace and recover the yields generated from the reinvestments.

The NT$19.5 billion may not represent all the property the KMT has, especially if it has some kind of charted benefits of which we are still unaware. Since the party's most valuable assets are tied up in real estate, this is what we will focus on.

However, we may not pursue other assets if the party's net value is negative after liquidation.

TT: The ministry's statistics show that over 80 percent of the real estate has been sold, with only about NT$3.88 billion's worth of assets left. What will you do about that?

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