Sunday, July 24, 2011

KMT wealth management

The incomes of the two major parties in Taiwan were revealed yesterday by the Ministry of the Interior:
The Chinese Nationalist Party (KMT) made NT$3.5 billion (US$121.5 million) last year, primarily on business investments, far outpacing the amount made by the Democratic Progressive Party (DPP), information from the Ministry of the Interior (MOI) showed.

Stock dividends accounted for almost NT$2.9 billion last year and made up more than four-fifths of the KMT’s total earnings, raising concerns about the extent to which the party depends on earnings from its assets and not donations.

The figures, published on Thursday by the ministry, reveal that political contributions to the KMT amounted to NT$240 million, or 6.9 percent of its earnings. It also earned NT$251 million in vote subsidies and an income of NT$76 million from party dues.

The DPP, meanwhile, received NT$192 million in political contributions and a total income of NT$626 million.
The article points out that the bulk of the investment income comes from two party-owned investment companies. President Ma, currently Chairman of the KMT pledged years ago to get rid of the party assets, which the KMT claims have been placed in trust. These assets were accumulated during the martial law era when the KMT ran the KMT party-state. The party should have been stripped of them years ago.

If the KMT made $2.9 billion from stock dividends, then, given a 5% return on investments, the KMT must have something like $60 billion NT, or $2 billion US, in investment assets.

One wonders which companies are the target of those investments. As a friend of mine pointed out to me yesterday, the people and party running the current cross-strait economic interaction -- which largely benefits big business -- are also the people and party running the KMT. But there's no conflict of interest there, of course. The assets are in trust. In fact the KMT even forgot they had them.... damn the DPP for reminding them during every election....
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les said...

Sunshine Law. Been a long time since I heard that phrase used... I guess there are a lot of places the sun don't shine.

Anonymous said...

"It's just a fact that corruption is likely to exist in any government. The interests of business and government in the U.S. are often criticized as being too close. Here in China we see a more blatant example, where a political party, under the auspice of a Wealth management company, is buying stake in big businesses while it also has the power to shape their policy.