The Taiwan High Speed Rail Corp (THSRC, 台灣高鐵) yesterday lashed out at lawmakers for attempting to block the government from funding the north-south rail project, saying their accusations about the illegality of such investments were without basis
Chairwoman Nita Ing (殷琪) said yesterday at a press conference that the bullet-train project was being conducted in line with the contract and that a lack of commitment by the government to the project and continued legislative wrangling would endanger any similar build-operate-transfer (BOT) project in the future.
Ing's statements came in response to lawmakers' accusations that the company was overly relying on government funding for the NT$446.4 billion project, thereby violating its contractual commitments.
Ing said that THSRC had not violated the conditions of the build-operate-transfer contract it signed with the government in 1998 and scolded the government for not doing enough to defend its involvement in the project against legislator grandstanding.
"In a BOT project, private enterprise and government are partners and each must take on risks and work together to resolve problems," Ing said.
Ing has made no secret that the company will be struggling to meet its capital requirement this year due to the economic downturn and had hoped to raise NT$18 billion from both state-run and private companies.
However, Ing, who has previously lambasted the government for pointing the finger of blame at her company over a potential vibration problem along the rail, said that the government is not committed to the project.
"We have noticed that the Cabinet's efforts to support the project have been inadequate before lawmakers ... who have based their actions on incorrect assumptions without fully considering whether they are legally reasonable," she said.
Lawmakers will today vote on a six-point proposal that seeks to halt the Cabinet's Development Fund (開發基金) and the state-run Taiwan Sugar Co (Taisugar, 台糖) -- two of the project's largest investors -- from investing any more money in the railway, which is now 30 percent complete.
The proposal, initiated by independent lawmaker Sisy Chen (陳文茜) and backed by the opposition PFP and KMT, also calls for a restructuring of THSRC's board, with appointments based on stockholder ownership, and for the company to reveal the details of all tendered contracts.
But according to Chen Ling-yu (
Taisugar has invested NT$5 billion -- or 10 percent -- and is the company's largest stockholder, while the Development Fund has kicked in NT$3 billion -- or 6 percent -- according to the company.
In fact, THSRC's Chen said that if the proposal passes and therefore forbids the government from continuing its investment in the BOT project -- the worlds largest -- then the government could be in violation of the law for not taking its investment to the maximum limit.
While not directly affecting construction, passage of the proposal would make attracting more investors much more difficult, said the lawyer, who added that such an outcome could eventually endanger the project.
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