China: Major scalp for corruption inquiry

The head of the commission that oversees China’s massive state-owned companies has been fired as part of a growing corruption investigation that appears to be an effort by the country’s new leaders to tighten control over government ­industries.

Jiang Jiemin. Picture: AP

The Communist Party dismissed Jiang Jiemin from his positions as director and deputy party chief of the Cabinet’s commission that runs state companies, the official Xinhua News Agency said yesterday, two days after officials announced an investigation into Mr Jiang.

Mr Jiang was formerly chairman of the huge state-run China National Petroleum Corporation, which has been the target of a corruption investigation that has netted four other top executives in recent days, including three executives at CNPC’s listed subsidiary, PetroChina.

As a full member of the party’s Central Committee, which is made up of its top 200 members, Mr Jiang is the most senior official to fall since new leader Xi Jinping took power in November. Mr Xi has made fighting widespread corruption a key campaign of his leadership so far, with promises to target both junior and high-level officials.

The probe suggests Mr Xi and Premier Li Keqiang are making a stab at tackling the powerful state-owned industries and their allies, who reformers say have hamstrung the government.

Willy Lam, an expert on party politics at the Chinese University of Hong Kong, said: “The state conglomerates, they are empires unto themselves. They have too much money and too much power. This could be a signal that the Xi Jinping and Li Keqiang leadership is finally trying to discipline them and keep a tighter rein over the conglomerates.”

A prominent Chinese newspaper, the 21st Century Business Herald, cited unidentified “insiders” yesterday as saying Mr Jiang had been close to disgraced politician Bo Xilai. Bo, whose downfall was triggered by a scandal involving his wife’s murder of British businessman Neil Heywood, stood trial for corruption and abuse of power late last month.

The newspaper said when Mr Jiang was at CNPC, he built oil refineries in places where Bo held leadership positions, including Liaoning province and the mega-
city of Chongqing, to enhance Bo’s “political performance”.

Also yesterday, some state media outlets, including the People’s Daily, reported that Zhang Shuguang, the former head of the transport bureau at what was then the railways ministry, has been charged with accepting the equivalent of more than £4.8 million in bribes between 2000 and 2011.

Earlier, unconfirmed news reports also said China’s leaders have taken the unusual step of endorsing a corruption investigation into Zhou Yongkang, a former security tsar and CNPC general manager with a power base in the oil industry.

The inquiry into China’s oil giant has also extended to one of the energy industry’s richest self-made entrepreneurs, Hua Bangsong, chairman of Shanghai-based Wison Engineering, which is a PetroChina supplier. Mr Hua, who founded Wison in 1997, is worth $1.2 billion, according to Forbes magazine.

Wison said Mr Hua was “assisting the relevant authorities” in their investigations.

The company, which provides engineering and construction services to the oil industry, said its board of directors “is convinced that factual circumstances will be clarified”.