05/07/2008, 00.00
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New scandal deals serious blow to Chen administration, funds for Papua disappear

The foreign minister and vice president in the outgoing pro-independence administration of President Chen Shui-bian are accused of embezzling millions of dollars destined for Papua New Guinea.

Taipei (AsiaNews/Agencies) – A new serious scandal has hit the outgoing administration of pro-independence President Chen Shui-bien. Two close aides to the president, the prime minister and the foreign minister have resigned to take the blame for allegations that some US$ 30 million destined for Papua-New Guinea were embezzled.

According to Taiwanese media, Chiou I-jen e James Huang were supposed to use the funds to gain diplomatic recognition from Papua New Guinea. Both Taipei and Beijing are involved in a game of chequebook diplomacy in which they pay for government projects in exchange for diplomatic recognition. In this case though, the funds disappeared.

Both leaders have denied any wrongdoing expressing their full confidence in the legal system which should shed some light on the affair.

However, the embezzlement charges, if proven, would represent a serious blow for the foreign policy of the outgoing president who was able to hang on to most commercial ties inherited from the previous Kuomintang administration.

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