The prospects for Taiwan’s economic and financial health are directly linked to officials serving on the front lines with government agencies in these areas, so it is essential that appropriate candidates are put in place to ensure economic progress, sustainability and security following the handover of power on May 20.
On Friday, premier-designate Lin Chuan (林全) announced more members of his future Cabinet, including three to be tasked with heading economic affairs, financial affairs and financial supervision. However, his picks have received mixed reviews.
Among his choices for the administration, Lin named National Taiwan University applied mechanics professor Lee Chih-kung (李世光) as minister of economic affairs, Vice Minister of Finance Sheu Yu-jer (許虞哲) as minister of finance, and Taipei Exchange Chairman Ding Kung-wha (丁克華) as Financial Supervisory Commission (FSC) chairman.
Lin’s announcement that Lee would head the Ministry of Economic Affairs came as a surprise to many, because Lee’s background is mainly in science and technology rather than economic and trade issues. Lee is the chief executive officer of the Ministry of Science and Technology’s National Energy Program. Previously, Lee played key roles at various government-related agencies, including the National Science Council, the Industrial Technology Research Institute and the Institute for Information Industry.
Lin told reporters that Lee’s thinking, expertise, leadership and decisionmaking impressed him. However, it is clear that Lee has been tapped to execute president-elect Tsai Ing-wen’s (蔡英文) plans for the development of the “green” energy industry and the cultivation of innovative startups that Tsai highlighted during her presidential campaign, and the key to this is whether he has a clear strategy for this.
Lee’s emergence as the new economics minister perhaps reflects the incoming Democratic Progressive Party administration’s plan to make Taiwan a nuclear-free and carbon-neutral nation by 2025. His decades of experience interacting with local industries and his knowledge about various high-tech fields are excellent qualities. Nevertheless, when Lee takes the helm, he is bound to run into the same difficulties his predecessor faced, including falling investment, decreasing exports and stagnant wages, as well as challenges securing free-trade pacts and transforming the nation’s basic economic structure. In other words, Lee will need competent, seasoned deputies to assist him in dealing with those demanding issues.
Ding, on the other hand, was one of Lin’s classmates at National Chengchi University and has held high positions in the Securities and Futures Commission, the Securities & Futures Institute and Taiwan Depository & Clearing Corp. Ding is experienced in dealing with issues related to capital markets and, as Lin said, might be able to think about FSC policy beyond its traditional supervisory and regulatory roles.
However, Ding’s ability to comprehend banking and insurance businesses has been questioned, at a time when FSC policies are being criticized by the business world for being aimed more at preventing corruption than creating business opportunities. If the commission wants to ease restrictions, this must be done by an official who is sufficiently knowledgeable about the financial industry.
It is a good thing that Sheu is shifting to the post of minister and can continue sharing his expertise with the Cabinet. He has worked in various positions at the ministry and local taxation bureaus over the past decades, so his appointment has garnered a positive reception from both outside and inside the ministry. However, certain reforms, such as measures to promote taxation parity and improve government finances, are set to remain challenging because of opposition by the vested interests of certain groups.
If Sheu wants to continue those reforms, he needs to formulate a more workable strategy than that of his predecessor.
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