Cabinet's 'economic clout' is a priority

Seeking to paint a rosier economic future, new Premier Chang Chun-hsiung (張俊雄) yesterday began the pain-staking process of selecting new ministers with the economic and financial clout essential to restoring confidence in the Cabinet.

The task will be one of the new premier's top priorities as Taiwan's markets and business community remain nervous about the economic thin ice the Chen Shui-bian (陳水扁) administration has been skating on for the last four months.

Seeking to set the tone for the new Cabinet's agenda, Chang said, "We will pursue political stability and economic growth as the highest priority."

Speaking at a hastily arranged press conference, Chang said the majority of Cabinet members will be retained after the body undergoes a "very small-scale reshuffle of mainly financial positions."

"I understand very well the need for a safe political environment, continued economic growth and stable stock markets," Chang said.

But Chang will have his work cut out for him as both Minister of Finance Shea Jia-dong (許嘉棟) and the Council for Economic Planning and Development Chairman Chen Po-chih (陳博志) have also made official their resignations.

In a final attempt to enter his name in the economic history books -- and shield the nation's beleaguered stock market -- Shea slashed the stock market's daily downward volatility limit to 3.5 percent until Oct. 11.

But the move did little to comfort investors who stayed on the sidelines throughout yesterday's session.

While Chen's departure was unexpected, Shea's withdrawal was no surprise, as the finance chief has long been expected to commit political harakiri for the 30 percent decline in the bourse since May.

Chang spent little time filling Shea's shoes, immediately turning to the shrewd financial expertise of the finance ministry's No. 2 man, Yen Ching-chang (顏慶章). Yen, currently vice minister of finance and head of the government's NT$500 billion stock market stabilization fund, will be seen as a positive choice for a Cabinet lacking in economic and financial prowess.

Yen, well versed in the formulation of financial policy, has served as vice finance minister since 1996.

While Chang has little proficiency in financial or economic matters, he may play a pivotal role in resolving the politically sensitive budget issue.

Just hours after Tang resigned, the new Cabinet agreed to opposition legislators' demands to withdraw its twice-rejected draft budget and submit a revised version to the legislature soon.

Known for his ability to find political common ground after serving six terms as a lawmaker, Chang will be the administration's bridge to the belligerent KMT-held legislature, which has been blocking attempts to carry out the president's economic agenda -- including passage of the 2001 national budget.