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Executive Yuan Promotes the Project of Introducing Private Capital to Expand Participation in Public Infrastructure

Today(July 2), the Minister without Portfolio of Executive Yuan, Jenn-Chuan Chern, invites relevant ministries, Taipei City and New Taipei City Governments to appraise how to introduce private capital to expand public infrastructure and the conference discusses and gives reports on the feasibility of urban redevelopment of public lands, insurance funds’ participation and investment in public infrastructure, activation of National Property(land), and the applications of private participation in infrastructure projects(such as flood control on frequently flooded areas). Minister without Portfolio Chern points out that faces with the current global economic situation, Premier Chen of the Executive Yuan attaches great importance to introduce private capital into participation in public infrastructure, and instructs Minister without Portfolio Chern to serve as project supervisor. Minister without Portfolio Chern adopts relevant resolutions for the issues discussed and asks each ministry to formulate specific promotional measures in two weeks, and the Executive Yuan will continue to hold a project conference to review.

During the conference, Construction and Planning Agency, Ministry of the Interior explains that a total of 180 government-led urban renewal cases are planned and accommodated nationally, of the 180 cases, there are 4 enterprises recruitment this year, and private sectors invest about NT $ 19.92 billion; in 2012, the recruit enterprises are estimated to be 6 cases, and the amount of private sectors’ investment is about NT $ 28.401 billion; in 2013, the recruit enterprises are estimated to be 10 cases, and the amount of private sectors’ investment is about NT $ 113.33 billion. As Minister without Portfolio Chern points out, urban redevelopment accelerates the improvement in urban style and has a positive significance for disaster prevention, so he requests Ministry of the Interior from view of the overall national interest to cooperate with Ministries and county and city governments and actively introduce private capital into participation. As for the problems faced by promoting urban redevelopment, please consult and solve these problems through the project conference of Executive Yuan’s “urban regeneration team,” research and analyze the feasibility of streamlining and relaxing relevant regulations on urban redevelopment and accelerate the promotion of urban redevelopment.

During the conference, the Deputy Director General of FSC Insurance Bureau, Yu-Qiong Ceng, explains that FSC council meeting has completed the review of amending the law on relaxing regulation of limiting insurance industry to serve as directors and supervisors of the investee company, and the regulation of limitations on the amounts of investing in public infrastructure (raises the investment ceiling on the same objects from 25% of the investee’s paid-in capital to 35%). Minister without Portfolio Chern affirms FSC’s efforts, and requests FSC not only to complete legal affairs as soon as possible but also to continue to propose streamlining and relaxing guidelines for relevant laws on Life Insurance Association’s intention of founding “Investment Platform for Public Infrastructure” to raise NT $ 800 billion investing in government's major projects. Besides, Minister without Portfolio Chern requests Public Construction Commission to synthesize each window of public works authority so as to provide Life Insurance Association with reference.

As for activation of National Property (land), Minister without Portfolio Chern points out that National Property Administration, Ministry of Finance establishes activation measures through reasonableness, relaxation, promotion, and other ways moving towards the right directions. Public Construction Commission has established related mechanisms and effect on promoting activation and private participation in public use property. Thus, Minister without Portfolio Chern requests National Property Administration to propose relaxing and giving preferential treatment to the issues of land rent, royalty money and other issues that local governments face during applying state-owned non-public lands to promote private participation so as to encourage local governments actively involving in promoting private participation and activating public assets.
Ministry of Economic Affairs submits the situation and the effectiveness of flood control in frequently flooded areas at the conference. Minister without Portfolio Chern says that owing to the reduction in risk of flooding, flood control facilitates creating the added value of local development, requests Ministry of Economic Affairs to explain to people and local governments, and requests local governments to make good use of the new land after flood control, combine the relaxation of land control with policy on developing tourism, and actively introduce private participation in development.

For promoting private participation, Minister without Portfolio Chern points out that the private participation rate was low in the past, but it is necessary for public infrastructure (such as Light Rail Transit System and Intelligent Transportation Systems, etc.). All ministries should think about how to actively develop sources and combine with relevant projects (such as sports, culture and creative, social welfare and multiple employment, etc.) of or laws on industry guidance so as to provide folk with more specific efficient assistance. Instead of pursuing financial gains, public service is the core of promoting private participation; thus, Jenn-Chuan Chern requests the competent authorities of each laws to review the relaxation of relevant regulations (for instance, to adjust house and public land renting and expense collecting standard of OT cases, and to provide local governments with state-owned non-public lands so as to cooperate with each other and promote private participation) at any time, also, requestsPublic Construction Commission to assist in removing obstacles to promotion of private participation; major issues can be coordinated and solved through the conference of “Executive Yuan’s Promotion of Private Participation in Infrastructure Projects Committee.”

Executive Yuan instructs and promotes Private Finance Initiative (PFI), which is the diversified financial means of early achieving public infrastructure and supplying with public service. Public Construction Commission has collected the PFI Act, guidelines for policy, model contract and other information in Japan, and a conference is scheduled for next week. As Minister without Portfolio Chern says, PFI involves reviewing public infrastructure projects and  preparing long-term government budget, so he requests Council for Economic Planning and Development, Directorate-General of Budget, Accounting and Statistics, Ministry of Finance and Public Construction Commission to cooperate closely so as to specifically promote their selection of model case as soon as possible.