PREMIER CONTINUES TO MOVE CLOSE AIDES TO KEY

C O N F I D E N T I A L SECTION 01 OF 02 TAIPEI 001151

SIPDIS

DEPT PASS AIT/WASHINGTON
DEPT PLEASE PASS USTR

E.O. 12958: DECL: 03/16/2015
TAGS: ECON ETRD PGOV TW
SUBJECT: PREMIER CONTINUES TO MOVE CLOSE AIDES TO KEY
POSITIONS


Classified By: ROBERT W. FORDEN, AIT KAOHSIUNG PRINCIPAL OFFICER.
REASON: 1.4(B/D).


1. (C) Summary. According to long-time allies of Premier
Frank Hsieh, Hsieh will continue to move key staff from the
Kaohsiung City Administration to the Executive Yuan.
However, political considerations are forcing a slow pace in
the announcements. Sources told AIT/K that former Kaohsiung
City Finance Director Kenneth Lin is likely to be named
Minister Without Portfolio in the next month, to assist Hsieh
in economic policy. Lin would replace former Economic
Minister Lin Yi-fu who is expected to be appointed Taiwan,s
representative to the WTO. Also likely to move to EY
positions in the coming months are Kaohsiung City Social
Affairs Director, Jason Hung, and Kaohsiung City Finance
Director, Ray Dawn. End Summary.


2. (C) Several long-time allies of Taiwan Premier Frank
Hsieh in Kaohsiung have told AIT/K that Hsieh continues
preparations to move his long-time aides into key positions
in the LY. In particular, Hsieh is preparing to make moves
in several EY Minister Without Portfolio positions that
traditionally have been filled by the Premier,s key advisors
in core policy areas.

New Minister/Economic Advisor and Representative to WTO
-------------- --------------


3. (C) Jason Hung, Kaohsiung City Social Affairs Bureau
Director and a key player in Hsieh,s former Kaohsiung City
Government team, told AIT/K March 14 that former Kaohsiung
City Finance Director Dr. Kenneth Lin will soon be appointed
to the Minister without Portfolio position now held by former
Minister of Economic Affairs Lin Yi-fu. Lin Yi-fu, Hung
said, will leave that position to become Taiwan,s new
Representative to the World Trade Organization (WTO). Hung
added that Lin Yi-fu,s move to Geneva became likely after
former Mainland Affairs Commission (MAC) Chairwoman Tsai
Ing-wen expressed no interest in taking up the WTO post.
Hung noted that the holder of this Minister without Portfolio
position was traditionally the Premier,s key advisor on
economic issues. The above appointments, he said, would
likely be announced in April.

New Minister At-Large for Social Affairs?
--------------


4. (C) Another Minister Without Portfolio position, vacated
by Chen Chi-Mai when he moved last month to become Acting
Mayor of Kaohsiung, has also been the subject of media
speculation. Former Kaohsiung Finance Director Kenneth Lin,
current Kaohsiung Finance Director Ray Dawn, and current
Kaohsiung Social Affairs Director Jason Hung had all been
mentioned as possible candidates. However, both Jason Hung
and Ray Dawn told AIT/K that the Ministerial position vacated
by Mayor Chen was one that had traditionally taken charge of
social and cultural issues. Thus, it was unlikely that
either Kenneth Lin or Ray Dawn would be appointed to this
position. As for Hung, however, his background and
experience fit. Hung declined to answer whether he had been
offered the post, but emphasized to AIT/K that his relations
with Premier Hsieh went way back and he expected to again
serve Hsieh in the future. Separately, however, Hung,s wife
told AIT/K staff that Premier Hsieh had already told Hung to
prepare to move to Taipei in mid-summer.

Other Hsieh Aides Wait Patiently
--------------


5. (C) Other former key advisors to PM Hsieh are also
expected to find new positions in the EY. In denying media
reports that he would be appointed to one of the two Minister
Without Portfolio positions described above, Dr. Ray Dawn,
the current Kaohsiung City Finance Director, told AIT/K that
he expected to be named to another position in the
not-too-distant future. He pointed out the Premier is under
a great deal of pressure to find positions for DPP nominees
who failed in their December 2004 LY election bids. Dawn
said that he expected to move to a new position in Taipei,
but meanwhile he needed to be patient.

Political Considerations Slowing New EY Appointments
-------------- --------------


6. (C) According to Hung, there are a number of reasons that
Premier Hsieh is moving slowly to install his own team in the
EY. First, Hsieh does not want to force out incumbents who
have been in their positions for a very short time. Instead,
he has tried to signal to them that they should work to find
new positions and allow them time if possible to prepare for
a graceful exit. Moreover, Hung said, Hsieh consults with
President Chen on all major appointments and will not make
any moves until he gets Chen,s concurrence. Finally, in
order to ensure completion of major projects started during
Hsieh,s tenure as Kaohsiung Mayor, Hsieh will not move key
members of the Kaohsiung City Government until he is certain
that acting-Mayor Chen Chi-Mai has selected replacements
capable of seeing the projects through to completion.

Comment: Hsieh Moving Deliberately to Take EY,s Reins
-------------- --------------

7. (C) Both Hung and Dawn are long-time contacts of AIT/K,
which considers them reliable. Both have longstanding and
close relationships with Premier Hsieh and served in key
advisory roles in Hsieh,s Kaohsiung City administration.
Their comments about the factors that are influencing the
slow pace of Hsieh,s appointments to key EY positions are
consistent with what we have heard from a variety of
contacts. They are also consistent with Hsieh,s management
style. When Hsieh took up the reins of the Kaohsiung City
Government six years ago, he also moved slowly to position
his closest aides into positions, being careful to ensure
that he and his allies had a strong command of the issues
before replacing experienced incumbents. Hsieh is also
widely expected to be a leading DPP candidate for President
in four years. In assembling his government, he wants to
ensure positions for key DPP figures, some of whom were
defeated in the LY election. This will be important for
broadening his support for a future presidential run.

FORDEN

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