Taipei’s finances could soon become worrisome, a Taipei City Council spokeswoman said, citing large debt and difficulties attracting private firms to take up build-operate-transfer (BOT) projects as concerns.
Council spokeswoman and Chinese Nationalist Party (KMT) member Wu Pi-chu (吳碧珠) said at a city council question-and-answer session with Taipei Mayor Ko Wen-je (柯文哲) that she is concerned over the city government’s stalling on closing BOT deals with the private sector.
Citing city government statistics, Wu said that as of last month the city contracted out BOT projects that would add NT$36 million (US$1.11 million) to its annual revenue, while the Kaohsiung City Government has signed BOT deals that would add NT$4.34 billion to its coffers over the same period.
“This means Taipei’s income from BOT projects is about a fraction of Kaoshiung’s income,” she said.
Wu said that her investigation found that Taipei ranked last among the nation’s four largest municipalities for BOTs.
New Taipei City ranked second after Kaohsiung by securing BOT deals with an annual revenue of NT$273 million as of last month, while third-placed Taichung booked NT$44 million, she said.
Furthermore, the Taipei City Government last year began soliciting tenders for seven BOT projects and so far, it has failed to attract any bidders, she said.
As the development level of a city’s infrastructure is the touchstone for its competitiveness, this indicates that Taipei’s competitiveness is of concern, she said.
Wu said that Taipei has a NT$126.67 billion debt and the city faces multiple potential compensations stemming from lawsuits concerning past BOT projects, such as the MeHas City housing project built by Radium Life Tech Co (日勝生), as well as contracts likely to be dissolved, such as the joint-development project to build houses integrated with the Nangang Depot on the Taipei Mass Rapid Transit System’s Bannan Line, which also went to Radium Life.
All of these factors pose a potential threat to Taipei’s financial wellbeing, she said.
The Taipei Department of Economic Development issued a statement touting the amount of foreign investments in Taipei from last year through March, which topped the nation.
Democratic Progressive Party (DPP) Taipei City Councilor Liang Wen-chieh (梁文傑) said that the department’s response was “ridiculous,” as foreign investments and BOT income are totally different.
He said that while many people attribute Taipei’s poor performance in soliciting BOT contractors to Ko’s perceived animosity toward corporations, as evidenced in his attempt to probe possible illegality in past BOT projects, he believes that Taipei’s plight is caused by contractual terms aimed at promoting public interests, which he said had been unreasonably attached to development projects.
Liang said that the firm that wins the bid for the right to operate on the land where the former Taipei City Council was located is required to relinquish 40 percent of its floor space to the city government for a planned museum.
“I doubt that there is any firm that can offset that cost,” he said.
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