How to reform the system of agricultural finance in Taiwan and establish it's corporate governance mechanism
| Autor: | Jin-Yuan Huang, 黃錦源 |
|---|---|
| Rok vydání: | 2005 |
| Druh dokumentu: | 學位論文 ; thesis |
| Popis: | 93 Ignited by the crashing run on the Farmer’s Association of Jhongli City in 1995, dozens of crashing run cases were ensued on farmer’s and fisherman’s associations island wide. By then, the rooted problems long existing in Taiwan’s grassroots farmer’s and fisherman’s financial system had finally drawn attention from the agricultural and financial circles. For a long time, Taiwan’s grassroots farmer’s and fisherman’s financial system had been controlled by the political force, so instead of well managing the organizations, election matters became the mainstay of those groups. As a result, it entailed defaults, such as properties being emptied out of those organizations or over-credited loans, and the organizations were therefore notorious for their black-gold phenomenon. However, due to the vague division for rights and obligations among the government’s competent authorities, it was easy for them to steer clear of their responsibilities and blame each other for mistakes. It fully illustrated the inefficiency of the execution of Government’s authorities. The pundits in the political and academic circles also joined the battle to express their contentions against each other. Most financial academics contended that the affairs should be unified and the Ministry of Finance should lead the unified management to rapidly and strictly dispose this issue. Nevertheless, the agricultural economic academics thought this issue should be handled by the Council of Agriculture, Executive Yuan in a manner to protect Taiwan’s agriculture. Initially, strict management was adopted by the Government. Relevant laws were modified and instituted, financial reconstruction fund was kicked off and 44 grassroots financial institutions with a negative post-adjusted net value were taken over by banks bearing all the rights and liabilities. The management continued to be made according to the grading of overdue loan ratio and the various businesses of the farmer’s and fisherman’s associations with bad business performance were restrained. Although President Chen brought up his reform resolution at the risk to lose his regime, yet defeated by the former President Lee who claimed the Government was going to eliminate farmer’s associations and led a large demonstration participated by more than 120,000 farmers, this policy blew out and turned over. The Government almost completely conceded to the agricultural economic system, enacted agriculture financial law, established a national agricultural vault, and built an agricultural financial system based on the unified management conducted by the Council of Agriculture, Executive Yuan. Even though it was positioned as a law of a compromise, the agricultural financial law has many merits for applause. For instance, independent board members take up 1/3 of the total board members in the national agricultural vault, independent supervisors and independent credit evaluation committee members also account for half of the total members, and stiff penalty is stipulated in the provisions. On the other hand, the provisions for the credit division of farmer’s and fisherman’s associations appear to be slack in comparison. While the national agricultural vault has been on the road and two-graded agricultural financial system has been accomplished, it will be the limelight to see if the Council of Agriculture that vowed to protect agriculture is competent, resolute and willing to do a good surveillance job and how the national agricultural vault plays its role as a qualified upper-level financial institution. In the introduction of the first chapter of this paper, Taiwan’s financial reforms, financial issues and the motivation of this study have been roughly elucidated. In the second chapter, the meaning and mechanism of corporate governance have been probed and literature relating to corporate governance, agency theory, financial surveillance and agricultural finance has been referred. The third chapter has investigated the background of Taiwan’s agricultural financial system and the issues confronted. In the forth chapter, Japan’s agricultural financial system and its internal as well as external surveillance mechanism have been introduced. In the fifth chapter, the reasons for a higher rate of overdue loans in the credit division have been analyzed, and the loan fraud cases occurred at Guanyin County Farmer’s Association and Yungmei Township Farmer’s Associations have been used as the case study to review the incompetence of internal surveillance and the procrastination of external monitoring mechanism. In the sixth chapter, the internal and external surveillance mechanism of agricultural financial system, and the various regulations stipulated according to the agricultural financial law for the past year or so by the Council of Agriculture have been analyzed. Conclusions as well as recommendations have been made in Chapter 7. This study suggested that dual financial surveillance would lead to looser surveillance of agricultural financial system watched by the Council of Agriculture than the surveillance of other financial institutions supervised by Taiwan Financial Supervisory Committee. Under such circumstances, we would recommend strict governance, rapid reform and recovery of share system so as to promote merger. In addition, credit management regulations shall be instituted so competitiveness and risks can be leveraged. Financial early warning system shall also be reinforced and the regulations shall be modified to prompt the withdrawal mechanism as early as possible, so as to fortify the surveillance of agriculture financial system. |
| Databáze: | Networked Digital Library of Theses & Dissertations |
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