Economy

Fantastic Mr Fox

Wang Qishan looks overseas, and to a new right-hand man, to fight graft

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More hawk than dove? Liu Jinguo (pictured right) has got a promotion

Hunting down corrupt officials who have fled abroad is the new action item on China’s graftbusting agenda. But the enormity of the challenge first came to light at a meeting on fighting economic crime in 2004. In the prior six years at least 230 corrupt officials had been repatriated, it was revealed. But 500 more were still at large, with the money involved topping $8.75 billion.

The man then in charge of the probe was public security minister Zhou Yongkang. Ironically enough Zhou is today the biggest catch (so far) in Chinese President Xi Jinping’s more recent anti-corruption drive.

If official figures are any guide, the problem of fleeing officials is much worse than 10 years ago. No estimate for missing assets is available from government sources, although the Washington-based Global Financial Integrity Group has suggested that that some $2.8 trillion flowed illegally out of China between 2005 and 2011.

Post-Zhou, it looks like Beijing will step up its efforts to track its errant officials overseas and the government launched Operation Fox Hunt in July to “block the last route of retreat” for civil servants who line their pockets and then skip the country. The Ministry of Public Security also said last week it has captured 180 officials who fled abroad with stolen cash – a number already surpassing last year. Among these, 104 were arrested by police (mainly in Southeast Asia) while 76 returned to China to give themselves up. Of the group, 44 had hidden offshore more than Rmb10 million each ($1.65 million).

Why is Operation Fox Hunt proving more effective than earlier campaigns?

Some put it down to the grim determination of Wang Qishan, head of the Party’s disciplinary watchdog and a leading member of the Politburo elite. His boss Xi Jinping has made graftbusting one of the priorities in his policy agenda. But according to the Beijing Times, the Chinese authorities are also now more willing to split any monies recovered in the cross-border hunts with foreign countries. Previously they had insisted that state-owned assets must be recovered in full, which often led to the breakdown of talks. Now it seems different. The Beijing Times notes that China signed an agreement with Canada last year to share the assets of Chinese fugitives caught sheltering there. The American authorities, the newspaper says, typically request a 50% to 80% split on major cases, but Beijing has been willing to work with countries that demand a bigger cut too. As a result, foreign governments are more willing to devote their time to finding and repatriating Chinese criminals, even if it means kicking out some of their wealthiest immigrants. The Australian police announced an agreement last month to assist Beijing in the extradition of fleeing officials as well, and the Sydney Morning Herald has reported that the first cases of asset forfeiture are expected within weeks.

This is important progess as the People’s Daily reckons that Australia, Canada and the US are favourite destinations for China’s disappearing bureaucrats. In the past their governments have been reluctant to send offenders home, anxious that they might face the death penalty. Beijing’s decision to drop capital punishment for economic crimes means that foreign governments are now more willing to help, the People’s Daily says.

Vice Public Security Minister Liu Jinguo, the man in charge of Fox Hunt, may deserve some credit too. Partly because of his achievements in hunting down the exiles, he was entrusted with the additional role of vice Party secretary of the Central Commission for Discipline Inspection last week. His appointment follows an unusually stark warning by his boss Wang Qishan that the anti-graft fight goes on (it began in late 2012). “Some Party cadres are still undeterred. Some have become even more corrupt… anyone who dares to remain undeterred will pay a price for it,” a statement on the watchdog’s website insisted.

In fact, Century Weekly has suggested that Liu’s appointment is a sign that the anti-graft drive is becoming more institutionalised. Xinhua also reported this week that a new anti-graft bureau will soon be set up under the judiciary. And if the media reports about Liu are accurate, Wang may have found himself a useful right-hand man (Doc Holliday to Wang’s Wyatt Earp, if we stretch the sheriff symbolism). Wang has a reputation as “the fireman” because of the numerous times that he has been assigned to trouble spots (see WiC176). But Liu has credentials for fighting flames too – in his case literally. In 2010 he led firefighters at an oil refinery blast in Dalian. Liu put his command headquarters at the site, impressing netizens, who believed that he risked death from ensuing explosions as 1,500 metric tonnes of oil spilled into the Yellow Sea.

Liu has a good reputation within the Party too and was selected as one of 10 people “Moving China” in 2011, a title for people who have performed heroic deeds or shown moral leadership. According to the Legal Evening News, a state-run newspaper, his wife has been working as a part-time clerk for 30 years, while the couple required a bank loan to purchase their apartment in Beijing. Both tidbits are astonishing pieces of news, as far as a jaundiced public is concerned.

During Liu’s tenure in the public security ministry, he also worked on projects that granted hukou – much desired city residency permits – to rural migrants. The Legal Daily said he approved 200,000 such cases but that, tellingly, the status of 38 of his relatives as rural citizens went unchanged.

Sounds too good to be true? Three years ago WiC introduced another security chief, Wang Lijun, who was enjoying a glowing reputation in the Chinese press. Wang is now in prison, brought low by the Bo Xilai scandal (see WiC129 for his initial appearance).

But according to Wen Wei Po, a pro-Beijing newspaper in Hong Kong, Liu doesn’t seem downcast by the doubters. “Many people suggest I have been faking my integrity. So I think I need to fake it all the way until I am dead. If Communist Party members all do the same, then it will become true,” the newspaper quoted him as saying.


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