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Chiou denies benefiting from Saudi Arabia tender

"Feel free to refer me to a judicial investigation."

Chiou I-jen, vice premier

Vice Premier Chiou I-jen (邱義仁) yesterday denied allegations that he had profited from Taiwan's bidding for a project to build a desalination plant and a power plant in Saudi Arabia.

Saying his behavior could stand scrutiny, Chiou told reporters: "Feel free to refer me to a judicial investigation."

Chiou said he did approve a scheme for a team of state-run enterprises -- Taiwan Power Co (Taipower, 台電), Taiwan Water Corp (台灣自來水) and Taiwan Cogeneration Corp (台灣汽電共生) -- to take part in the bidding for the US$4 billion project, with the Ministry of Economic Affairs submitting a tender for the development project in King Abdullah.

But Chiou said that he was not involved in the process of assessing the project's feasibility nor did he make a profit from it.

The ministry on Thursday also denied paying any kickbacks to help the group's bidding for the project.

Premier Chang Chun-hsiung (張俊雄) urged those who had accused the administration or officials of profiting from the Saudi Arabia tender, as well as the establishment of the arms firm Taiwan Goal (鐽震) and plans to privatize the Grand Hotel (圓山大飯店), to provide proof to back their claims.

"The government will deal with any irregularity severely. We will not be lenient with officials who break the law. But what proof have they provided?" Chang said.

At issue is a payment of US$200,000 that Taiwan has made, which was received by a Taiwanese businessman identified as Hung Chen-chien, who represents a consulting service firm in Saudi Arabia.

Vice Minister of Economic Affairs Fadah Hsieh (謝發達) said on Thursday that the payment was for "consulting services" rendered, and not kickbacks, adding that hiring a consultant was common practice in international bidding.

Hsieh said in line with a contract signed with the company, payment was made only after the company successfully helped the Taiwanese group pass a first-round qualification screening. No further payment is required for subsequent services provided by the firm.

On Thursday night, Minister of Economic Affairs Steve Chen (陳瑞隆) said the government had taken part in the bidding because the project serves Taiwan's economic interests, and not because "someone has brokered it."

Aside from the group from Taiwan, 10 other bidders from around the world have passed the first-round qualification screening, and open bidding is scheduled to be held at the end of May.

Taipower officials said the desalination and power plant project is a touchstone for Taiwanese businesses hoping to break into the Saudi Arabian market.

If Taiwan successfully wins the bid, it will open a door for related industries and financial institutions in Taiwan to make inroads into the Middle East market, the officials said.
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