Vice-premier quits party to take heat over funds scandal

Taiwanese Vice-Premier Chiou I-jen quit the Democratic Progressive Party yesterday and vowed to step down from politics after May 20, to take responsibility for a diplomatic scandal involving the alleged embezzlement of US$30 million.

Mr Chiou's action is widely seen as an effort to limit the damage the scandal has already inflicted on the party and President Chen Shui-bian's government, and a response to mounting calls from both within and outside the party for him to shoulder responsibility.

'I am full of shame towards the country and people because of the Taiwan-Papua New Guinea diplomatic scandal,' Mr Chiou said.

'Besides co-operating with the judicial investigation, from now on I withdraw from my beloved Democratic Progressive Party.'

He also said he would 'forever step down from the political arena' after leaving the government in a short time, referring to May 20 when the new Kuomintang government, led by president-elect Ma Ying-jeou, comes to power.

Dubbed the 'wisest guy' in the pro-independence party, Mr Chiou is known for his close links to Mr Chen. He admitted earlier that, at his suggestion, the Taiwanese Foreign Ministry transferred the US$30 million to two middlemen, Wu Shih-tsai and Ching Chi-ju, to help the island establish diplomatic ties with Papua New Guinea.