Taiwan's defence minister resigned on Saturday as the government backed down on a controversial plan to invest in a new company set up to handle its arms imports. Lee Tien-yu quit after opposition lawmakers accused members of the ruling Democratic Progressive Party of seeking to profit from the company, Taiwan Goal, which is headed by DPP heavyweight Wu Nai-jen.
"I deeply regret that the establishment of Taiwan Goal caused concerns and doubts in various sectors and I hereby tender my resignation," he said in a brief statement.
The government also said it would cancel plans to put up 45 percent of Taiwan Goal's initial capital of 200 million dollars (6.33 million US). "Collaborating with private companies would have helped boost the defence industry, but it has been stigmatised. The premier has instructed that... (the defence ministry) will not invest in Taiwan Goal or other companies of its kind," cabinet spokesman Chen Chin-chun said.
Michael Tsai, a former vice defence minister, has been appointed the new defence minister, Chen said. Tsai, 67, currently serves as an adviser at the defence ministry. Taiwan Goal will reportedly handle the government's estimated 150-billion-dollar purchase of PC-3 anti-submarine aircraft, attack helicopters and transport planes from the United States.