Taiwan Govt Creates Task Force To Oversee High Speed Rail
4 October 2005
TAIPEI (Dow Jones)--The Taiwan government has created a task force to oversee a NT$480 billion project to build a high-speed rail system linking the cities of Taipei and Kaohsiung.
The task force, which will be led by Premier Frank Hsieh, plans to increase the government's number of seats on Taiwan High Speed Rail Corp.'s (2633.OT) 12-member board from the two it has now, Hsieh said in a statement Monday.
The Ministry of Transportation and Communications will work out a 'reasonable' number of seats for the government that corresponds with its 11.9% stake in Taiwan High Speed Rail, Hsieh said. The government controls the 11.9% stake directly and through companies in which it has a stake of over 50%.
Taiwan High Speed's shareholders will elect a new board in May 2006.
The government wants more control over the progress of the project and effective 'crisis management,' the premier said. The task force was created after the government-linked China Aviation Development Foundation and China Technical Consultants Inc. together injected NT$7.5 billion in Taiwan High Speed Rail, which was holding its latest fund-raising round.
The builder of the island's first bullet train has delayed fund-raising plans several times after it failed to commit its shareholders to provide more capital as scheduled.
'After the government helped raise money for the project, we want to oversee the entire project and ensure the train begins to operate next year,' said Executive Yuan Secretary-general Cho Jung-tai Tuesday.
'The government is our partner anyway, according to the original build-operate-transfer contract,' said Ted Chia, a public affairs assistant vice president of Taiwan High Speed Rail.
The task force, which will meet once every two weeks, will gather officials from the transport, finance, interior and other ministries.
The project's five founding shareholders combined now own a 28.5% stake. Of the founders, the largest shareholder, Continental Engineering Corp. (2526.TW), owns only 7.2% in the project.
According to Cho, the government plans to replace one of its current representative controllers on the board, Kuang-Yu Chang, with the deputy minister of the Directorate General of Budget, Accounting and Statistics, Yuh-Lin Lee.
Cho added that the government will assist the company to resolve its differences with Japan's Shinkansen consortium, which is responsible for the system's core electrical system. In September, Taiwan High Speed Rail said the service's launch will be delayed by a year to October 2006 because of delays in completing the electrical system.
The entire project is 86% completed, with the core electrical system behind schedule, the Cabinet said in Monday's statement. By the end of August, 63% of the core electrical system was complete, said Chia.
4 October 2005
TAIPEI (Dow Jones)--The Taiwan government has created a task force to oversee a NT$480 billion project to build a high-speed rail system linking the cities of Taipei and Kaohsiung.
The task force, which will be led by Premier Frank Hsieh, plans to increase the government's number of seats on Taiwan High Speed Rail Corp.'s (2633.OT) 12-member board from the two it has now, Hsieh said in a statement Monday.
The Ministry of Transportation and Communications will work out a 'reasonable' number of seats for the government that corresponds with its 11.9% stake in Taiwan High Speed Rail, Hsieh said. The government controls the 11.9% stake directly and through companies in which it has a stake of over 50%.
Taiwan High Speed's shareholders will elect a new board in May 2006.
The government wants more control over the progress of the project and effective 'crisis management,' the premier said. The task force was created after the government-linked China Aviation Development Foundation and China Technical Consultants Inc. together injected NT$7.5 billion in Taiwan High Speed Rail, which was holding its latest fund-raising round.
The builder of the island's first bullet train has delayed fund-raising plans several times after it failed to commit its shareholders to provide more capital as scheduled.
'After the government helped raise money for the project, we want to oversee the entire project and ensure the train begins to operate next year,' said Executive Yuan Secretary-general Cho Jung-tai Tuesday.
'The government is our partner anyway, according to the original build-operate-transfer contract,' said Ted Chia, a public affairs assistant vice president of Taiwan High Speed Rail.
The task force, which will meet once every two weeks, will gather officials from the transport, finance, interior and other ministries.
The project's five founding shareholders combined now own a 28.5% stake. Of the founders, the largest shareholder, Continental Engineering Corp. (2526.TW), owns only 7.2% in the project.
According to Cho, the government plans to replace one of its current representative controllers on the board, Kuang-Yu Chang, with the deputy minister of the Directorate General of Budget, Accounting and Statistics, Yuh-Lin Lee.
Cho added that the government will assist the company to resolve its differences with Japan's Shinkansen consortium, which is responsible for the system's core electrical system. In September, Taiwan High Speed Rail said the service's launch will be delayed by a year to October 2006 because of delays in completing the electrical system.
The entire project is 86% completed, with the core electrical system behind schedule, the Cabinet said in Monday's statement. By the end of August, 63% of the core electrical system was complete, said Chia.
