Legislature freezes part of Taiwan's ADB donation over designation

Taipei, June 8 (CNA) The Legislative Yuan's Finance Committee decided on Monday to freeze nearly a quarter of the funding Taiwan has proposed to give the Asian Development Bank in 2026 in protest against the bank's change of Taiwan's designation 40 years ago.

Lawmakers across party lines, including Wu Ping-jui (吳秉叡) of the ruling Democratic Progressive Party (DPP) and Lai Shyh-bao (賴士葆) of the opposition Kuomintang (KMT), agreed to freeze NT$30 million (US$949,968) of the NT$126.84 million ADB funding budget proposed by the Ministry of Finance (MOF) for 2026.

They said the NT$30 million will not be unfrozen until the ADB responds to Taiwan's concerns over the designation.

Though the Republic of China (Taiwan) was one of the founding members of the ADB in 1966, its designation was changed to "Taipei,China" (space after the comma deliberately omitted) in 1986, after the People's Republic of China joined the bank.

Wu said the ADB has failed to treat Taiwan fairly, yet despite annual protests against the designation without a response, Taipei still provides normal funding to the bank.

Wu said Taiwan would not include the NT$30 million portion of the budgeted funding until the ADB changed the designation.

Lai said Taiwan has been belittled at the ADB, and he initially suggested not providing any funding to the bank other than its NT$1 million in annual basic administrative fee.

The NT$126.84 million budgeted to fund the ADB in 2026 is up NT$44.26 million from 2024.

Li Ming-chi (李明機), head of the MOF's Department of International Fiscal Affairs, said the ministry followed other donors to the ADB who were raising their donations.

Li said the NT$126.84 billion budget is divided into two parts. The first totals NT$93 million and will go to the Asia Development Trust Fund, which has 35 donors and provides member countries natural disaster relief.

Taiwan's allies such as Palau have been beneficiaries of this fund, and without sufficient donations, these Pacific countries could be affected.

The second part totaling NT$33 million will go to the Domestic Resource Mobilization Trust Fund, which was set up by Taiwan and Japan in 2017 and is aimed at providing financing to improve the fiscal resilience and taxation capacity of developing member countries, Li said.

Finance Minister Chuang Tsui-yun (莊翠雲), who protested Taiwan's designation at the ADB's 59th annual meeting in May for the third time since assuming her post at the end of January 2023, said Taiwan has voiced opposition to the designation through many diplomatic channels.

Chuang also noted, however, that Taiwan has not received any unfair treatment in other areas related to the ADB and said it was more important for Taiwan for the time being to engage in meaningful participation in the bank rather than risk "being kicked out."