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John Liu
Thursday, Oct 16, 2014

Asia

Taiwan govt officials hint at more oil scandals to come

The China Post/ANN | John Liu | Thursday, Oct 16, 2014

TAIPEI, Taiwan - As Namchow Chemical Industrial Co. becomes the newest company implicated in the oil scandal, government officials caution that there might be more firms using tainted oil.

At a time when the nation is still deeply troubled by the oil scandal, Premier Jiang Yi-huah said on Tuesday that there are two more "unexploded bombs" to be unveiled.

Yesterday Namchow was implicated for allegedly mixing industrial oil with food oil. As it turned out, Namchow is one of those bombs.

According to the Ministry of Health and Welfare (MHW), the case of Namchow was uncovered as a result of an extended search in the wake of the recently surfaced oil scandal.

Now that Namchow has "exploded," there is more data coming in, said Vice Minister Shiu Ming-neng, implying that there are more companies implicated in the food safety issue.

As most of the implicated companies in the food scandal are listed companies, the reason for "delayed explosions" may indicate fear of damaging shareholder interest.

Finance Minister Chang Sheng-ford said yesterday that it is preferable to "detonate the bombs," as public health is more important than creditor rights.

Reputation of Taiwanese Food Takes a Hit

In an effort to evaluate the food scandal's full impact on Taiwan, the Foreign and National Defence Committee summoned nearly 10 competent authorities to the Legislature for a report.

The National Security Bureau (NSB) confirmed that the scandal has damaged the reputation of Taiwanese foods in the global community.

Both Japan and mainland China have decided to ban imports of Taiwanese food products. The scandal has also had a negative impact on Taiwan's progress in establishing free trade agreements with other countries, said NSB Director-General Lee Shying-jow.

Deputy Economics Minister Shen Jong-chin forecast that Taiwan will incur a loss of NT$10.21 billion (S$432,000) in output as a result of the food safety scandal.

Sales of frozen dumplings and buns, seasoning sauces, cookies and pastries, oil and meat products are likely to suffer, Shen said.

The Government Ponders Change in Laws

The Ministry of Economic Affairs (MOEA) said yesterday that it has long been suspicious that Namchow imported non-food oil in the guise of edible products. The ministry is currently investigating whether it is human error or purposeful deceit.

Namchow stated that human error in customs declaration led to the alleged wrongdoing.

However, analysts found it hard to believe that a 62-year-old large-scale company could have mistaken goods that needed a tariff for those that are tariff free.

Local regulations stipulate that imports of food oil require the government's prior approval, while feed and industrial oils do not. Consequently, it is hard to keep track of oils of the latter category once they are imported into Taiwan.

The Executive Yuan has instructed competent authorities, including the MOEA and MHW, to make adjustments to the law.

In the future, all types of oils will need approval from the government before they can be imported.

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