Puffer-fish protests and Xi’s China dream; ordinary Chinese have been watching their unelected representatives gorge themselves on their tax renminbi for decades

April 30, 2013 6:19 pm

Puffer-fish protests and Xi’s China dream

By Patti Waldmeir in Shanghai

Officials are discovering the power of the middle-class Nimby, writes Patti Waldmeir

Something about the tale just did not add up: several hundred people turn up to protest because officials of a provincial city in China are eating swordfish, puffer fish and other forms of lethal seafood at the taxpayer’s expense?

Sure, there’s an austerity drive on in China: these days, bloated bureaucrats are not meant to be eating, drinking or being merry at public expense. But ordinary Chinese have been watching their unelected representatives gorge themselves on their tax renminbi for decades. Surely it takes more than another government anti-corruption campaign to rouse them to revolution?Granted, there is no shortage of public anger in China at governmental graft, greed and gluttony. That, presumably, is why almost half a million people watched the video of the puffer fish protest online – complete with lingering shots of the masticated detritus of the meal and moving footage of Zhang Aihua, the government host, apparently kneeling on the table to beg forgiveness. No one can quite agree on exactly what he said then, or even whether he was really kneeling. He may have said something like: “I am your son, your grandson, I know I am wrong,” or maybe it was more like: “All of you are my parents who pay me.” And maybe he just lost his footing: some onlookers say he was pleading with people to leave the prefabricated building where the banquet was held, for fear it would collapse – not asking forgiveness for the size of his publicly funded gut. But whatever he said, it was too little too late: with an alacrity not normally associated with local governments in China, he was removed from office pronto.

So it’s not hard to understand why social network-savvy Chinese would fire up their iPhones to watch Mr Zhang humiliate himself. But what were hundreds of people doing at the government offices watching him eat in the first place – rather than being at home on the couch watching Qing dynasty soap operas or reality television shows like they normally would be?

And that is where the story gets more interesting – not to mention more worrying for China’s leaders. As it turns out, the reason so many people were hanging around the offices of the state-owned Taizhou Binjiang industrial park, in the eastern city of Taizhou, was because they had a bone to pick with Mr Zhang quite apart from the aforementioned fish bones.

Local newspapers report (and calls to local residents confirm) that the banquet protest was almost accidental: the protesters went to the park offices to complain about a land dispute. The local government is forcibly expropriating their land, in the name of economic development – and there’s nothing new about that in China. They say they are not being paid enough money to move out of houses threatened by proximity to a new petrochemical plant. So the puffer fish protest was really part environmental and part plain old Nimby dispute. And those are a lot harder to handle than official eating disorders.

As you read this, residents of the Shanghai suburb of Songjiang – appropriately, the same suburb that has recently had more than 10,000 dead pigs floating in its water supply – are trying to find a way to resist the construction of an electric car battery plant on their doorstep. (It is the same suburb whose river recently turned white because of illegal dumping by a local Apple supplier.)

But it remains to be seen whether a protest against the battery plant planned for today’s May Day holiday will go ahead: security police have been making uninvited visits to both the Songjiang and Taizhou protesters. The government knows that ifPresident Xi Jinping is to deliver the “China dream” of greater affluence for ordinary citizens, he needs petrochemical plants and probably electric car battery factories to do it. And there is no shortage of government officials willing to take a bribe to make sure those plants get built in their backyards, whatever the environmental consequences.

So that may be the real message of the Taizhou dinner revolt: you can put government officials on a diet of Yangzhou fried rice and water for a while, and you can even banish Rolexes from their wrists and Porsches from their parking lots. But until the link between corruption and development can be severed, no government official can safely savour his swordfish. The growth of the middle class in China means the rise of the Nimbies – and Mr Zhang may not be the last one who ends up kowtowing for his life to them.

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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