Transport minister to chair CAL foundation/fund

The China Post staff

Transportation and Communication Minister Lin Ling-san said yesterday he will take over the helm of the foundation controlling China Airlines from Tsay Jaw-yang, who resigned Thursday night in the wake of last Saturday’s fatal air disaster. The Cabinet accepted the resignations of Tsay and eight other board members of the China Aviation Development Foundation, which owns 71 percent of China Airlines’ shares. “Their resignations will give impetus to reform of the Aviation Development Foundation and management of China Airlines,” Minister without Portfolio Tsay Ching yen told a news conference.

Observers have said China Airlines Chairman Lee Yun-ling and its president, Philip Wei, as well as Civil Aeronautics Administration Director Chang Kuo-cheng, would be reappointed to the foundation’s board.

Lin said he will select from among Cabinet ministers the candidates to fill the remaining five seats on the board of the foundation.

Last Saturday, a China Airlines Boeing 747-200 carrying 225 aboard plunged into seas off the Penghu islands, marking the 10th fatal crash in the past three decades for Taiwan’s largest carrier. Investigators are still looking into the possible cause of the fatal accident, which many have said is a mystery. Six days after the accident, only 97 bodies and one percent of the aircraft have been recovered and the black box flight data recorders are still on the ocean floor.

The recorders were located early this week but choppy seas and bad weather have delayed salvage efforts.

Following the accident, many lawmakers have demanded that Tsay resign as chairman of the board and called for reshuffling the foundation and improving the airline company’s poor safety record. Please see CAL on page

Premier Yu Shyi-kun has promised he would push for privatization of China Airlines – an idea Tsay objected to.

Tsay was at odds with the government on the share release. While the Ministry of Transportation and Communication has the right to name five out of the nine board members, Tsay insisted his foundation is a private, non-profit institution and its assets do not belong to the government.

Enjoying close ties with former President Lee Teng-hui, Tsay resigned as transportation minister in 1998 after a China Airlines Airbus carrying holidaymakers back from Bali crashed near Taipei, killing 196 aboard and seven on the ground.

Tsay bounced back from the political wilderness last July when he was appointed chairman of the foundation by the Democratic Progressive government.

The premier said a recommended list of the foundation’s board members would be announced today. The final lineup will be completed June 10. With regard to China Airlines’ privatization, Yu has instructed that the goal must be achieved within two years. By then, the premier said, the foundation should have no more control over China Airlines’ operations and management.

In principle, Yu added, income from China Airlines’ share release belongs to a special fund under the Ministry of Transportation and Communications. Also, the foundation should dissolve after China Airlines is privatized, Yu said.

The awkward ownership structure of China Airlines through the foundation has been widely blamed for paralyzing management and making reforms almost impossible.