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MND says subs should be made in US

Huang Kuang-kuo, left, and Chang Ya-chung, right, co-founders of the Democratic Action Alliance, yesterday call on the government to protest remarks by US Deputy Undersecretary of Defense for Asian and Pacific Affairs Richard Lawless -- who said that if Taiwan's arms budget fails to pass, it will have ``repercussions'' in the US. PHOTO: WANG YI-SUNG, TAIPEI TIMES

Vice Minister of National Defense Michael Tsai (蔡明憲) told the Legislative Yuan yesterday that the eight diesel-electric submarines in the government's arms procurement plans should be made in the US.

He said the subs could be built in Washington state, or at shipyards in Connecticut and Mississippi.

Both the US Department of Defense and Ministry of National Defense have previously denied a statement made by Representative to Washington David Lee (李大維) that the subs would be built at US naval shipyards.

Officials have said the method of purchase was still undecided, much less where the subs would be produced.

The submarines are part of the government's NT$610.8 billion arms procurement budget.

Tsai's remark prompted questions from opposition lawmakers about the government's arms deal policy.

People First Party (PFP) Legislator Lin Yu-fang (林郁方) criticized the arms deal yesterday, saying that since the US was taking a NT$20 billion design fee from Taiwan, its claims that only the cost of purchasing the subs from Europe prevented it from lowering its prices were "fundamentally untrue."

Lin called on the ministry to demand the US drop the design payment and press for the navy to call for a transfer of both the intellectual property associated with the design and the manufacturing rights.

Otherwise, he said, he would demand the withdrawal of the arms procurement budget.

The legislature's National Defense Committee held a closed-door meeting yesterday to which Minister of National Defense Lee Jye (李傑) had been invited to hear a report by Chungshan Institute of Technology staff.

Since Lee had other commitments, Tsai attended the meeting instead.

According to an account by Lin, as Tsai was answering lawmakers' questions, he said, "The submarines should be made in the US," and that apart from the Bess shipyard in Connecticut and a shipyard in Mississippi, a shipyard in Washington state was another possibility.

The legislators took Tsai's comments to mean that Taiwan would no longer get advanced European submarines, and that the US would handle the entire deal -- from blueprints to production lines to manufacturing.

Lin said that Taiwan began making the sub design payments to the US Navy in 2001 and has now paid US$8 million -- approximately NT$20 billion -- and that many legislators want to know if such a large payment was necessary.

"The ministry originally said it hoped to ask the Europeans about buying subs," Lin said.

"But it now appears as though, after three years and having gone round in a huge circle, the form of purchase is still undecided so the place of manufacture will be decided first," Lin said.

"Fundamentally, the Americans determined from the outset that they would earn Taiwan's submarine fee," he said.

"The ministry has no any choice to accept it," he said.
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