- WSJ.com Taiwan's President Vows to Cede Power Amid Scandals June 2, 2006
DOW JONES REPRINTS This copy is for your personal, non-commercial use only. To order presentation-ready copies for distribution to your colleagues, clients or customers, use the Order Reprints tool at the bottom of any article or visit: www.djreprints.com. See a sample reprint in PDF format. Order a reprint of this article now. Taiwan's President Vows to Cede Power Amid Scandals By JASON DEAN in Beijing and CHIU PILING in Taipei, Taiwan Staff Reporters of THE WALL STREET JOURNAL June 2, 2006; Page A5 The president of Taiwan pledged to cede some of his powers, a move likely to cement his lame-duck image for the last two years of his tenure. Still, it might do little to end the partisan rancor that has riled the island's politics or to improve relations with longtime adversary China. President Chen Shui-bian said he will hand over policy-making and cabinet-appointment authority to the premier, Su Tseng-chang. The move came a week after the detention of the president's son-in-law following allegations of insider trading by an opposition politician. The subject of the son-in-law, along with investigations involving other people close to Mr. Chen, has aroused widespread public anger. Authorities have kept Mr. Chen's son-in-law, Chao Chien-ming, in custody since May 24, but he hasn't been formally charged with any offense, and he has denied wrongdoing. Mr. Chen, in a statement issued by his office late Wednesday, said he will retain powers specifically "conferred on the president" by the island's constitution, which is famously vague in delineating authority. Mr. Chen didn't elaborate. David Lee, the presidential-office spokesman, said in a telephone interview Thursday that the president's remaining areas of authority include relations with China and foreign and defense policy -- as well as the power to appoint and dismiss the premier. Late Thursday, Mr. Chen accepted the resignation of Ma Yung-chen, his deputy chief of staff and perhaps his closest adviser. In a statement distributed by the presidential office, Mr. Ma said his decision was a response to Mr. Chen's call for change. A second administration aide, a member of the National Security Council, also resigned. Mr. Chen's announcement demonstrated the damage the recent allegations has wreaked on the president, whose approval rating has plunged to record lows of below 20% in recent months. The move falls far short of the resignation some opposition legislators have called for and appears to leave significant room for the 55-year-old Mr. Chen in the island's governance.
Furor over the recent scandals has exacerbated political squabbling and hindered policy making in Taiwan, Asia's fifth-largest economy and home to many of the world's biggest electronics manufacturers. Even before the recent rash of corruption allegations, Mr. Chen was under fire from many in Taiwan for his confrontational approach to dealing with China, which claims Taiwan as part of its rightful territory and reviles Mr. Chen for his efforts to strengthen the de facto independence Taiwan has enjoyed since 1949. The authority Mr. Chen pledged to cede appears centered on economic and other domestic-policy issues. Taiwan is struggling to maintain its economic growth, which last year was slightly more than 4%, as many of its manufacturers have shifted jobs to China. Mr. Chen himself hasn't been implicated in any of the cases of alleged wrongdoing. Still, the allegations have badly damaged Mr. Chen. He and his party have long claimed a reputation for clean government -- one they have frequently contrasted with the widespread corruption past during decades of rule by the Kuomintang, or Nationalist Party. Some members of Mr. Chen's Democratic Progressive Party, or DPP, have warned that the recent scandals could cause the party to lose presidential elections in 2008 to the Kuomintang, now the main opposition party, which favors closer ties with China. Mr. Chen, who took office in 2000 and was re-elected in 2004, is constitutionally barred from running again. Mr. Chen's pledge to cede power "won't be able to stabilize the political situation," said Ger Yeong-kuang, a political-science professor at National Taiwan University. Mr. Ger, who generally supports the opposition, said the president's qualified retreat from power could even encourage opponents to seek further concessions. In the presidential-office statement, Mr. Chen said he will "completely respect" the premier's cabinet appointments, and that the premier will have "complete authority and complete responsibility" for policy making. Mr. Chen also said he will withdraw from any decision-making role in his party and won't play a role in the 2008 presidential election. Mr. Chen's move throws greater attention on Mr. Su, whom Mr. Chen appointed in January. The 58-year-old longtime politician, who previously headed the DPP, is considered a strong contender to become its 2008 presidential candidate. Mr. Chao, a physician married to the president's daughter, remains in detention as part of an investigation into the purchase by Mr. Chao's mother and two of his friends of shares in Taiwan Development Corp. a government-controlled investment company. The purchases, which began in late July , were followed in late August by approval of a syndicated loan of more than US$500 million from a consortium of lenders led by state-owned Bank of Taiwan. Taiwan Development incurred a loss in 2004, then restructured and announced a net profit for 2005. Shares in Taiwan Development, which traded at about 4 New Taiwan dollars, or 12 U.S. cents, in late July, rose to more than NT$8 by the end of 2005, and topped NT$20.20 early last month, before retreating. On Thursday, they fell 4.6% to NT$11.30. Prosecutors are investigating an opposition la...