t has been wrongly condemned by the opposition and has caused the defense minister to resign, Premier Chang Chiun-hsiung decided yesterday. Chang was cited by his top aide, Chen Chin-jun, as saying that the government will not invest in any private firms that deal with the arms industry.
"The government will not invest a single dime in Taiwan Goal," said Chen, referring to the company that the Ministry of National Defense had planned to invest in.
"If the government wants to purchase any weapons, it will not do it through Taiwan Goal," Chen said.
Chen maintained that no government money had been channeled to Taiwan Goal yet, and neither the government nor the company had ever signed any agreement.
The premier's decision came after Defense Minister Lee Tien-yu resigned over the Taiwan Goal project.
Lee said he had been instructed to set up Taiwan Goal, but had failed to carry out the plan properly.
Lee has come under heavy pressure from the opposition camp after news broke that the MND would invest in Taiwan Goal.
Critics have alleged ulterior motives behind the firm, as its multi-billion-dollar business would not be subject to parliamentary monitoring.
Chang was cited by his top aide as saying that the forming of Taiwan Goal was meant to upgrade Taiwan's arms industry, but the company had been "wrongly defamed."
With the government pulling out amid the tremendous controversy, Taiwan Goal may also close up shop, according to its Chairman Wu Nai-jen, a heavyweight of the ruling Democratic Progressive Party (DPP).
Wu said the recent allegations of possible scams to be accompanying the company's operations have distorted the government's intentions of upgrading Taiwan's arms industry.
He said by calling for strict parliamentary monitoring of the company, the company's critics have been trying to destroy Taiwan Goal's status as a private company.
"The significance of Taiwan Goal's existence has been lost, and we'll soon call a shareholders' meeting to discuss disbanding the company," said Wu in a written press statement.
The government has argued that a private company is needed to integrate military and civilian resources for the the development of the island's arms industry.
The merits of a private company is that many arms suppliers are reluctant to deal with government institutions, it claims.
Earlier yesterday, Premier Chang said openly that the choice of whether the MND should continue to invest in Taiwan Goal should be given careful reconsideration.
"I think it's necessary to reconsider whether the MND should go on as scheduled to invest in a 45 percent stake of the company," Chang said.
"If we think it is improper for the MND to invest in the company, then it should not invest," the premier went on.
Chang said that the MND had yet to submit an investment proposal to the Cabinet concerning the Taiwan Goal project, and no funding had been channeled into the project.
Chang noted that until the MND's funds were channeled into the project, the company would remain privately owned and that the Cabinet therefore had no legal authority to disband the company.
Taiwan Goal completed registration with the Ministry of Economic Affairs (MOEA) Jan. 28 as a private company, with capital of NT$1 billion (US$31.15 million) and paid-in capital totaling NT$80 million.
The chairman, Wu, heads the China Steel Machinery Corp. -- a subsidiary of the formerly state-owned China Steel Corp.
MOEA data shows that Taiwan Goal has a seven-member board of directors, with three seats going to the MND.
Taiwan Goal is registered to deal in a variety of businesses, including the import and export of arms and weaponry systems; sales of garments and accessories, industrial explosives, precision instruments, and batteries of all types; and product design, according to the MOEA.
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