For years the government has struggled and floundered with bureaucratic and poorly managed state-run enterprises, most of which are in the red year after year. President Chen Shui-bian (
Indeed, the success in turning around some of the state-run enterprises deserves some applause. For decades, state-run enterprises lacked the flexibility, innovation and profit motive of private companies. Their operations were also tightly restricted by law. Their employees, almost civil servants, received annual bonuses regardless of whether their firms were profitable or not, and often appeared unmotivated.
In view of the worldwide recession, the fact that all eight remaining state-run enterprises under the supervision of the Ministry of Finance turned a profit last year is proof of the government's determination and commitment to overhauling these firms despite the extremely painful and long restructuring process.
For example, in 1991 China Shipbuilding lost about NT$3.62 billion, with its net loss more than twice that of the previous year. By last year, however, the company had a net profit of NT$350 million. This result came at a hefty price. As many as 47 percent of its employees were laid off, while those who stayed had to take a 35 percent pay cut. Tang End Iron Works, which earned NT$400 million last year had to downsize its construction division and sell off some other non-profitable divisions.
The finance ministry had planned to complete the privatization of state-run enterprises by releasing the government's shares in these companies for public trading by the end of this year. At present only China Shipbuilding and Taiwan Salt Industrial Corp are set to complete their privatizations on schedule. The privatization of the others will be delayed. Chen has reiterated his determination that the entire privatization process will become more public and transparent in order to avoid the controversies that surrounded First Financial Holding Co's sale of new shares in the form of global depositary receipts to overseas investors.
Chen has three messages about the revamping of state-run enterprises that he wants to get across to the public. First, despite the criticism of those with vested interests and skepticism about the less-than-ideal progress reports on his administration, Chen is trying to indicate that rewards await those with patience and commitment to reforms. Second, his talk about privatization and the market mechanism aligns with a major theme of his reelection campaign, which is reform and democracy. Third, he is trying give the public a sense of hope and confidence toward both him and the future of this country under his leadership.
This is obviously done in response to the pan-blue's campaign strategy, which is to depict a general sense of dissatisfaction, pessimism and hopelessness about the present state of affairs and the future of the nation under the DPP's rule. Which will work? Only time will tell.
Chinese actor Alan Yu (于朦朧) died after allegedly falling from a building in Beijing on Sept. 11. The actor’s mysterious death was tightly censored on Chinese social media, with discussions and doubts about the incident quickly erased. Even Hong Kong artist Daniel Chan’s (陳曉東) post questioning the truth about the case was automatically deleted, sparking concern among overseas Chinese-speaking communities about the dark culture and severe censorship in China’s entertainment industry. Yu had been under house arrest for days, and forced to drink with the rich and powerful before he died, reports said. He lost his life in this vicious
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