Briton questions CAL engine contract

TRADE RELATIONS: A UK investment official is visiting Taiwan to discover why the British company Rolls-Royce lost out on a contract to supply aircraft engines to China Airlines

By Melody Chen  /  STAFF REPORTER

Tue, Oct 07, 2003 - Page 1

A high-ranking British trade and investment official yesterday expressed concerns about the transparency of China Airlines' bidding process for an aircraft engines deal. The US company General Electric won the contract despite concerted lobbying by British company Rolls-Royce.

"There is no point not saying that we are very disappointed at that decision and we believe that Rolls-Royce have mounted a very professional campaign, that they offered the right product, the right technology, the right after-care that was needed," said Sir Stephen Brown, group chief executive of British Trade International.

Brown arrived in Taiwan on Sunday for a three-day visit, one of the main purposes of which is to find out why the airline chose GE rather than Rolls-Royce.

The high-profile engines deal, which was also being contested by another US company, Pratt & Whitney, caused such a row in July and August that both US and UK officials stationed in Taiwan personally lobbied the Presidential Office to win the contract.

While China Airlines insisted that no political forces had intervened during the bidding process, Paul Brooks, Rolls-Royce's general manager in Taiwan, said yesterday he had some personal opinions about how diplomatic maneuvers had affected the outcome of the process.

"But I will keep the opinions to myself," said Brooks, who joined a luncheon where Brown delivered a keynote speech.

China Airlines declined to reveal how much the deal was worth, but reports estimated it at between US$600 million and US$700 million.

"I think it is essential that in all these contracts of this size, the process must be transparent ... The playing field has got to be level. And I think that was our concern. It didn't seem to have been quite transparent," Brown said.

"The process has to be transparent, fair and open. If it is not, the companies will feel they will never win," he said.

Brown described Rolls-Royce, which has suffered three similar setbacks in Taiwan, as "serious players."

"They [Rolls-Royce] know that sometimes you win; sometimes you lose. I think they will continue to stick to trying to do business here," Brown said.

In response to concerns expressed by Brown and Brooks, China Airlines spokesman Roger Han (韓粱中) said yesterday that the process had been absolutely fair and transparent.

Brown said he would like to see clarifications concerning the deal. He met government officials to inquire about details of the deal yesterday afternoon.

It was not immediately clear which officials he met or the issues they discussed. Han said he did not know whether Brown had talked to China Airlines officials.

Brown did not say whether the UK will be seeking to pressure Taiwan over the deal through the EU.

But, recognizing Taiwan as the world's 14th largest economy and an important partner to the UK, Brown said he did not want to "convey the impression that this particular issue is the only reason" he was here.

The British Trade and Cultural Office is planning to hold a seminar discussing how the UK and Taiwan can collaborate in agriculture under the WTO umbrella.

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