Has China President Xi’s graft crackdown run out of steam? Analysts say candid coverage of ‘consultations’ may indicate leadership lacks will to take action

Has Xi’s graft crackdown run out of steam?

Tuesday, 09 July, 2013, 12:00am

Cary Huang cary.huang@scmp.com

Analysts say candid coverage of ‘consultations’ may indicate leadership lacks will to take action

President Xi Jinping has consulted retired party leaders on his anti-corruption and austerity campaign, the Communist Party’s official newspaper reported on Monday – a move some analysts believe is a sign that the current leadership lacks the confidence or political will to ring the changes of real political reform.

People’s Daily yesterday gave a rare glimpse into behind-the-scenes details of the intensive politburo meetings on June 22-25. The meetings assessed the anti-corruption and frugality measures that Xi launched earlier this year.“Entrusted by General Secretary Xi Jinping, Liu Yunshan, Zhao Leji, Li Zhanshu, and Zhao Hongzhu have heard opinion from old comrades who were members of the Politburo Standing Committee, through various channels during late May and early June,” the People’s Daily reported.

The Politburo meetings, which lasted 61/2 days, took more than two months to prepare, the report said. The preparations also included consultations with nearly 500 senior central and regional party or government officials.

Since becoming Communist Party chief more than six months ago, Xi has intensified a campaign to crack down on corruption and launched a high-profile drive to improve party officials’ performance, including cutting red tape and extravagance – moves that raised hopes that the new leaders would eventually introduce meaningful political reform.

Now analysts say that the latest sanctioned revelations in state media indicate that the new leadership is more cautious or conservative than previously thought, particularly on politically sensitive issues.

“Reports that the new leaders have consulted retired leaders over this campaign suggest a lack of confidence among current leaders, because it shows the incumbents are concerned that their drive would meet strong resistance from vested interests,” said Professor Gu Su , a political affairs analyst at Nanjing University.

Chen Ziming , a political affairs analyst, said it indicated a lack of political will and determination on Xi’s part to push through meaningful political reform to root out corruption.

So-called “consultation with former leaders” often smacks of political compromises that result in “less tough measures and more lenient punishments” for the anti-graft campaign, Chen said.

Gu was doubtful that Xi’s anti-graft campaign would succeed if political reform were placed on the back-burner.

“The party won’t succeed [in stamping out corruption] if it insists on keeping it an internal affair of the communist party without external checks and balances,” Gu said.

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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