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Fri, Jan 14, 2000 - Page 2 News List

KMT says business ties `natural'

DARK RELATIONSHIPS As accusations against the KMT gather steam, a high-ranking official said the party may be guilty of one thing

By William Ide  /  STAFF REPORTER

With accusations mushrooming against the KMT over the origins and ownership of billions of dollars in party assets and its close ties with the country's top business leaders, a high-ranking official of the party's business management committee said yesterday that such ties were not as murky as some people were making them out to be.

"Fifty years is a long time, and you can't not make friends. We have too many friends," Darby Liu (劉大貝), secretary-general of the KMT's business management committee, told the Taipei Times yesterday.

Liu said developing relationships with business leaders is a natural thing and explains why the party's business committee includes successful businessman such as Chen Zhe-fang (陳哲芳) of Nice Enterprises, Tuntex Group's Chen Yu-hao (陳由豪) and Lin Hsieh Han Chien (林謝旱見) of the Hung Kuo Group.

"It's natural to want to develop relationships with successful businesses. As long as you're not breaking the rules, that's business," Liu said. "It's not anything shady. Just like any other business, we've had to get rid of businesses and lay people off."

The KMT's business arm, which has investments in some 300 companies, employs around 4,000 people and pays about NT$2.5 billion annually in pension funds.

Still, KMT presidential candidate Lien Chan's campaign promise to take the party's billions in assets and put into them into a trust fund has provoked a wide range of accusations.

While the party's assets are not a new source of controversy, the recent scandal over allegations of financial misdeeds by James Soong has brought the issue further into the spotlight.

"Many people figure that if Soong is 10 percent corrupt, then the KMT must be 90 percent corrupt," Chu Yun-han (朱雲漢), a professor of political science at National Taiwan University, said.

For example, a donation of NT$100 million to Soong -- revealed during the recent financial scandal -- by Tuntex Group chairman Chen Yu-hao in 1991, could be indicative of such ties.

The Taipei Times recently reported, quoting sources close to Chen, that President Lee Teng-hui (李登輝) and his wife invited seven couples to their home last year to attend their 49th anniversary party. Chen and his wife, Lin Fu-mei (林富美), were on the list, suggesting just how influential Chen is.

Chen, who has expanded his company over the past 20 years -- diversifying from textiles into construction, mobile phones, department stores and hotels -- was hit hard by problems following the Asian financial crisis in 1997-1998.

Sources said that Chen, who was burdened with debt at the time, used his connections with KMT business czar Liu Tai-ying (劉泰英). Chen sold the Regent Center, located on Linsen North Road in Taipei, to the KMT-run Broadcasting Corporation of China for over NT$3 billion.

Liu denied accusations that the KMT business enterprise existed to bail out close friends of the party -- noting that "we can't be so close together with companies that they can rely on us for support"

As accusations gather steam, Liu added, the KMT has no choice but to "dance to the music."

It's not fair to us, we want to improve," he said.

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