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By P.K.Balachandran/Ceylon Today
Colombo, November 6: Since he took over in 2012, China’s President Xi Jinping has been waging a war against corruption in the civil and military establishment and also the corporate sector from the top to the bottom.
According to published material, in Xi’s first year in power, more than 180,000 officials were “disciplined”, compared with about 160,000 the year before. In the next decade, 3.7 million cadres were punished by the party’s anti-graft watchdog, including about 1% of national and provincial leaders.
Xi is said to have branded top-level corrupt persons euphemistically as “tigers” and the low-level corrupt as “flies”.
Writing in The Diplomat in May 2022, Indian researcher Rahul Karan Reddy, says that the anti-corruption campaign was set in motion by a sensational scandal in February 2012 involving the head of Chongqing’s Public Security Bureau, who fled to the US consulate in Chengdu in a bid to claim asylum in the United States.
“The incident revealed the alleged murder of a British businessman, which snowballed into rumours of a coup plot against Xi Jinping by Bo Xilai, party secretary of Chongqing, and Zhou Yongkang, secretary of the Central Political and Legal Affairs Commission and a member of the 17th Politburo Standing Committee. Soon after the incident, Bo was dismissed from the CCP and eventually sentenced to life in prison for bribery, abuse of power, and embezzlement,” Reddy recalls.
“That incident was followed by another high-profile investigation, this time focused on Liu Zhijun, the minister of railways responsible for China’s sprawling high-speed railway network. Liu’s case was, by far, one of the most widely followed news stories in China and the prosecution’s recommendation that he be given a lenient sentence was met with unanimous opposition by citizens across the country.”
“These incidents cultivated the necessary public support for an anti-corruption campaign that was then in its infancy.”
Rooted Liberalisation
The theory is that corruption had taken root in China’s system as a by-product of the opening up of the economy to spur economic growth and make China a pre-eminent economic power in the world.
As Reddy writes: “Corruption became increasingly visible after the reform and opening up of 1978. The injection of capital created opportunities for Chinese Communist Party (CCP) and state officials to exploit state resources for private gain.”
“However, tackling corruption took a back seat as China embraced capital and private enterprise, reflected in Deng Xiaoping’s phrase to get rich is glorious.”
But forty years later in November 2012, China’s outgoing leader Hu Jintao warned that systemic corruption could lead to the downfall of the CCP and the government of China.
“Picking up where Hu left off, Xi Jinping, in his first speech as the CCP’s general secretary, highlighted graft and corruption as the most pressing challenge confronting the party. A decade later, Xi’s anti-corruption drive is an all-encompassing campaign sweeping across the party, state, and private enterprises, eliminating his political opponents and becoming a hallmark of his tenure as China’s top leader,” Reddy recalls.
But despite Xi’s strong and periodic purges, corruption has survived in China and is as robust as ever to this day, at the top as well as the lower levels across the board.
Top-Level Offenders
Recently, Li Shangfu, China’s Minister of National Defence, was sacked. The military investigated bidding irregularities for equipment purchases dating to when Li was director of the Equipment Development Department and also in charge of China’s weapons procurement.
Commenting on the sacking Defence Ministry spokesman Wu Qian said: “Our fight against corruption will never stop.”
Media reported that in August, two of the most senior officials in the People’s Liberation Army (PLA) Rocket Force were replaced. Fu Xiaodong, a former senior official at China Development Bank, was sentenced to 10 years in prison for accepting 4.3 million yuan (£503,466) in bribes between 2007 and 2020.
A former Director of the Supreme People’s Court Enforcement Bureau Meng Xiao, was sentenced to 12 years in prison for accepting bribes worth 22.74m yuan (£2.65m) in a space of a decade.
Xi’s campaign has been popular with the Chinese public as people are truly appalled by the amassing of wealth by the political, administrative and entrepreneurial elite.
A recent study by the Stone Center on Socio-economic Inequality, by Li Yang, Branko Milanovic and Yaoqi Lin found that in the decade after Xi took office, 91% of officials convicted of corruption were in the richest 1% of China’s urban population. Were it not for their ill-gotten gains, only 6% would have been in that elite segment, the study found.
More than 50 senior personnel of major banks and state-owned enterprises have either been investigated or disciplined by the Central Commission for Discipline Inspection (CCDI) as the Chinese Communist Party (CCP) sees financial corruption as a threat to national security.
The CCDI referred Zhao Weiguo, a semiconductor tycoon, to prosecutors for corrupt practices when he was the chairman of Tsinghua Unigroup. It had declared bankruptcy in 2021.
The CCDI had also announced investigations into Liu Liange, the former Bank of China chairman, and Li Xiaopeng, the former chairman of the state-owned financial conglomerate China Everbright Group. Bao Fan, a billionaire tech banker, was taken away by the authorities in February to assist with an investigation and hasn’t been seen in public since.
Even sports associations have taken to corruption and have been investigated. On 9 April, the CCDI said it would probe 30 state-owned enterprises and the General Administration of Sport; several football officials have already been placed under investigation.
Lack of Transparency
Lack of transparency in the highly controlled Chinese economy and political system may be at the root of corruption, says Ling Li, a lecturer at the University of Vienna.
According to Ling the very structure of the party breeds graft: a lack of transparency benefits both autocratic leaders and unscrupulous cadres.
“Corruption occurs in a very decentralised fashion. That means you always have more corruption than the anti-corruption agency has the capacity to investigate,” he submits.
Rich Stash Money Abroad
President Xi Jinping has been wary of financiers, doubting their loyalty to the CCP. That is why after his crackdown on corruption that began in 2013, China’s elites started whisking their money out of the country.
In 2014, China had nearly US$ 4 trillion in foreign reserves. But within two years that had dropped by nearly one-quarter, reports reveal.
Given the opportunities to stash money abroad, Xi’s government is trying to promote locally rooted companies and discourage companies with overseas connections.
James Palmer, the deputy editor of Foreign Policy magazine says that Chinese officials have started to talk about the need for a “sweet potato economy” – a term first used in 2021 by Xi to describe Chinese firms that stay rooted in China and under the Communist Party’s control while they expand “to absorb the sunlight and nutrients of the global economy.”
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