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Taiwan’s defence minister resigned on Saturday amid a scandal over a government plan to set up a private firm to handle major arms purchases from the United States, the defense ministry said.
Lee Tian-yu tendered his resignation after he failed to secure sufficient funding for the company, Taiwan Goal, the Defense Ministry said on its Web site.
“The minister deeply regrets the failure to implement this plan... and the concerns and doubts it sparked,” the ministry said.
Premier Chang Chun-hsiung accepted Lee’s resignation, said government spokesman Chen Ching-chun.
When the scandal was first exposed last week, Lee said the military was asked to provide up to 45 per cent of the company’s capital, but he feared his ministry could not oversee the firm’s operations.
“We had hoped the setup of the private company could help upgrade our defense industry,” Chen said.
“Since the project had been denounced, the government has decided to suspend all investment plans on defense-related companies,” he added.
Opposition lawmakers said Taiwan Goal was to be run by loyalists of President Chen Shui-bian, who were to earn commissions from arms deals. They said some of the revenues were to go to the inner circle of Chen’s Democratic Progressive Party after the president’s term expires in May.
“On the eve of expected power transfer, the DPP hoped it could continue to control arms purchases by signing up the many contracts and later subcontracting them to their loyalists,” said Ting Shou-chung of the opposition Nationalist Party.
“Lee had to resign because he refused to fully cooperate with the DPP,” Ting said.
Ting said the contracts involved purchases of PC3 anti-sub aircraft, attack helicopters and the upgrading of US-made F16 fighter jets and French-made Mirage jets. Total amounts of the contracts exceeded 200 billion New Taiwan dollars ($6.5 billion, Dh23.86 billion), he said.
Opinion polls show the opposition Nationalist Party’s Ma Ying-jeou is leading the DPP’s Frank Hsieh by at least 20 points in the March presidential poll. (AP)
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