State-owned enterprises — the target of much criticism lately — have become a byword for “inefficiency.” To change that perception and improve their efficiency, they should go back to basics, so their businesses can be run normally and rationally, and without political intervention.
On April 10, a special panel that was formed to improve the performance of state-run Taiwan Power Co and CPC Corp, Taiwan, held its first meeting. A member of the panel, General Chamber of Commerce vice chairman Wang Ying-chieh (王應傑), called for the rationalization of fuel and electricity prices. However, aside from reviewing these firms’ personnel and systems, the government should prevent elected representatives from asking the companies for money in the name of goodwill to local communities. Their requests for money may seem insignificant, but it shows the distorted business environment state-owned enterprises have to deal with.
What is needed is a clear separation of affairs. Electricity subsidies for the agricultural sector, local governments and schools should be budgeted by the respective governing authorities to avoid having representatives of state-owned enterprises obfuscating and talking about “policy factors” every time the budget is discussed. It has never been clear what part of the system of these state-owned enterprises’ poor performance can be attributed to policy factors or to human error. Annual reviews of their performance are held, but they always end in the presentation of official documents that mean nothing.
The fact is the definition of the role of legislators is seriously flawed. On the one hand, they are responsible for monitoring the government’s budget; on the other, they are also the ones who often take advantage of state-owned enterprises. This is a very contradictory state of affairs. To strictly monitor the government’s spending, they should not tolerate any waste, but then they often ask state-owned enterprises for money so they can provide services for their supporters. If this situation does not change, the ubiquity of greedy lawmakers will remain the greatest burden of state-owned enterprises.
A state-owned enterprise is established for policy reasons, otherwise there would be no need for them. Since their task is policy-related, efficiency is not a priority, while personal relationships are. That always leaves a large gray area that those good at networking can take advantage of like fish in water. They rarely get caught, because everyone does the same thing. It may not be the best job in the world, but they never have to worry about going hungry. Everyone will eventually get their chance to “fish in troubled waters.” This is a common flaw of all state-owned enterprises.
Once state-owned enterprises perform poorly, they blame it on “policy factors.” This is an effective excuse because it is difficult to find the real cause. As a result, muddling through and mediocrity have become the norm. Every time a state-owned enterprise is criticized for its poor performance, it can always blame policy and avoid responsibility.
One can only lament the shortcomings of state-owned enterprises that are the result of policy factors. The premise for transforming these enterprises is to remove their policy-related duties. However, that leaves the question of whether there is any reason for their existence without such duties. This question is the key to all their problems.
It is clear that all policy-related duties that are irrelevant to the core business of a state-owned enterprise should be removed. If that is not done, then privatization is preferable to maintaining the present mode. That would also comply with the logic of capitalism, and would be the right prescription for dealing with the malady.
Chu Yen-kuei is a lecturer of law at National Open University.
Translated by Eddy Chang
Recently, China launched another diplomatic offensive against Taiwan, improperly linking its “one China principle” with UN General Assembly Resolution 2758 to constrain Taiwan’s diplomatic space. After Taiwan’s presidential election on Jan. 13, China persuaded Nauru to sever diplomatic ties with Taiwan. Nauru cited Resolution 2758 in its declaration of the diplomatic break. Subsequently, during the WHO Executive Board meeting that month, Beijing rallied countries including Venezuela, Zimbabwe, Belarus, Egypt, Nicaragua, Sri Lanka, Laos, Russia, Syria and Pakistan to reiterate the “one China principle” in their statements, and assert that “Resolution 2758 has settled the status of Taiwan” to hinder Taiwan’s
Singaporean Prime Minister Lee Hsien Loong’s (李顯龍) decision to step down after 19 years and hand power to his deputy, Lawrence Wong (黃循財), on May 15 was expected — though, perhaps, not so soon. Most political analysts had been eyeing an end-of-year handover, to ensure more time for Wong to study and shadow the role, ahead of general elections that must be called by November next year. Wong — who is currently both deputy prime minister and minister of finance — would need a combination of fresh ideas, wisdom and experience as he writes the nation’s next chapter. The world that
Can US dialogue and cooperation with the communist dictatorship in Beijing help avert a Taiwan Strait crisis? Or is US President Joe Biden playing into Chinese President Xi Jinping’s (習近平) hands? With America preoccupied with the wars in Europe and the Middle East, Biden is seeking better relations with Xi’s regime. The goal is to responsibly manage US-China competition and prevent unintended conflict, thereby hoping to create greater space for the two countries to work together in areas where their interests align. The existing wars have already stretched US military resources thin, and the last thing Biden wants is yet another war.
Since the Russian invasion of Ukraine in February 2022, people have been asking if Taiwan is the next Ukraine. At a G7 meeting of national leaders in January, Japanese Prime Minister Fumio Kishida warned that Taiwan “could be the next Ukraine” if Chinese aggression is not checked. NATO Secretary-General Jens Stoltenberg has said that if Russia is not defeated, then “today, it’s Ukraine, tomorrow it can be Taiwan.” China does not like this rhetoric. Its diplomats ask people to stop saying “Ukraine today, Taiwan tomorrow.” However, the rhetoric and stated ambition of Chinese President Xi Jinping (習近平) on Taiwan shows strong parallels with