• Sunday, October 04, 2015

Perng Fai-nan sets example for Taiwan's politicians

Editorial 2011-09-04 15:31 (GMT+8)
Perng Fai-nan has been one of the world's few central bankers to maintain an untarnished reputation throughout the global financial crisis and ensuing recession. (File Photo/China Times)

Perng Fai-nan has been one of the world's few central bankers to maintain an untarnished reputation throughout the global financial crisis and ensuing recession. (File Photo/China Times)

Since assuming the post of governor of Taiwan's central bank in 1998, Perng Fai-nan, who helped the nation steer through two financial crises, has topped Global Finance magazine's list of the world's top bankers for eight years in a row, receiving an "A" rating each time during his 13-year stint.

Amid power struggles between the ruling and opposition parties, in today's Cabinet few are like Perng, whose professional ability and integrity are recognized by both sides. As early as the Chen Shui-bian administration, Perng was seen as the most popular candidate for the country's premier. After President Ma Ying-jeou took power, the administration was also considering asking Perng to head the Cabinet during a reshuffle.

It is not surprising that Tsai Ing-wen, chairwoman of Taiwan's opposition Democratic Progressive Party and the party's candidate for the 2012 presidential election, targeted Perng as a potential running mate, though the offer was turned down by Perng.

In addition to his professional ability, distancing himself from politicized debates, seeking to maintain the independence of local currency and dedication to his work have impressed both the ruling and opposition parties. Some described him as working every day except the Chinese New Year's Eve.

The central bank set maintaining financial stability as its most important goal during the 1997-1998 Asian financial crisis as well as the 2007-2008 financial crisis. In the face of inflows of speculative hot money, Perng employed flexible monetary measures to stave off international speculators and maintain market order.

His professional ability was displayed on several fronts: protecting the competitiveness of Taiwan's exports by allowing foreign exchange rate flexibility, while maintaining loose monetary policy to promote economic growth and allowing domestic inflation to stay below 2%.

In addition, to curb soaring housing prices, the central bank imposed selective credit control on housing loans, raised its benchmark interest rates and reduced lending for land development and housing construction. According to statistics, as of July bank loans for housing purchases and construction had continued to increase, but growth was slowing.

The central bank governor, the manager of Taiwan's foreign exchange reserves of US$400 billion, has been praised for his integrity. Aside from NT$8 million (US$275,843) in savings, he has never owned any stocks. He earned huge sums from gold investments after opening a gold account over 10 years ago when the Central Trust of China, of which he served as chief of the board of directors, started this business. The gold price per ounce was then US$350, and has seen a rise to about US$1,800.

Perng's integrity was particularly commendable during the former Chen Shui-bian government, because corruption was rampant as the government carried out its second round of financial reforms.

The current and second term for Perng, who served through the Lee Teng-hui, Chen and Ma administrations, will last until February 2013. His high approval ratings in various public opinion surveys indicate his high popularity and the public's expectation for more political officials who can cross party lines and create new opportunities for Taiwan as a result of their professional insistence, just as Perng has done.

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Wang Enge (王恩哥)

Wang Enge is native of Shenyang in Liaoning province. Wang was born in January 1957 and graduated from Liaoning University with a master's degrees in 1985 and a doctorate degree in Physics from ...