Case of Hangzhou 'fallen tiger' sounds alert to officials in rich regions

City launches campaign to examine govt-business relations

The anti-graft authority in Hangzhou, East China's Zhejiang Province announced on Monday that it has launched a special campaign to address problems in establishing a close but clear relationship between the government and the business sectors.

The announcement came after news on Saturday that Zhou Jiangyong, the city's Party chief, was put under investigation on suspicion of serious violations of laws and Party disciplines, casting a spotlight on the city that is home to billionaire Jack Ma's Ant Group and Alibaba Group Holding.

Chinese anti-graft experts said the 54-year-old official is the first provincial-level official investigated in Zhejiang since the 19th National Congress of the Communist Party of China was held in 2017, but the case should not be excessively interpreted before the details of the case and the results of the investigation are released.

But they warned that it should also sound an alarm to Zhejiang officials that the province has been designated as a testing ground for a national plan to achieve common prosperity - which Chinese President Xi Jinping said is the essential requirement of socialism and also an important feature of China's modernization. Thus, they should have a clear idea of the heavy burden they are shouldering in development and resources allocation.

The case also sets an example to other rich cities, said experts, as it once again demonstrated the principle of China's anti-graft campaign: there is no forbidden area against corruption.

In the special campaign, Hangzhou's Commission for Discipline Inspection listed 10 scenarios under which conflicts of interest may rise, and it asked government officials to undertake self-examination and rectify any issues within three months, the commission's official website showed on Monday morning.

It mainly focused on officials' illegal loans, and their spouses' or children's businesses. Since the launch of the campaign, 24,849 officials in the city have undergone self-examination, including those retired or dismissed from office.

If officials failed to report their spouses' and children's businesses, they would face harsh punishment on suspicion of abusing their power for personal gain.

"Hangzhou has become one of China's most affluent cities, and now it is home to hundreds of thousands of private enterprises. The highly developed market economy has brought great challenges to the establishment of a healthy relationship between the local government and business," a Beijing-based anti-graft expert told the Global Times on condition of anonymity, adding that "Zhejiang is taking the lead in achieving common prosperity and narrowing gaps between the rich and the poor."

Before further details and results of the investigation are made public, people should not jump to a conclusion too soon and make any excessive speculation about capital's involvement in Zhou investigation, the expert said.

Alibaba's financial arm Ant Group refuted online rumors that the investigated official had bought shares of the company during its IPO, saying in a Sunday statement that "the rumors about certain person taking shares in the company is false, not to mention sudden share buying or refund." Many have linked such rumor with Zhou.

The expert noted that Zhou's case has sounded a timely alarm to local officials to avoid "power corruption."

Early in 2016, Zhejiang released a guideline, drawing eight clear red lines on the relationship between the government and businesses, and stressing that it will hold a "zero-tolerance" attitude toward any violations.

For example, the guideline bans officials from arbitrary inspections, fines, charges and taking donations from enterprises. It also prohibits officials from abusing their power for personal gains in market access, licensing, project examination and approval, land acquisition, business administration, tax collection and other areas.

It also bans officials from conniving, acquiescing or instructing their spouses and children to seek illegal interests from enterprises.

The Zhejiang Gongshang University has been releasing reports on the index of close, clear government-business relations for three years. The latest one, released on May 21, showed that the overall situation is fair and internal divergences are gradually being narrowed.

The cities of Hangzhou, Jiaxing and Ningbo were ranked at the top.

Gan Chaoying, a professor from Peking University Law School, told the Global Times on Monday that the case and the special campaign show the province's determination to crack down on high-ranking officials' corruption, to clear its way to achieve the goal of common prosperity.

Private entrepreneurs are the important builders of common prosperity, Gan said, and local governments should create a healthy environment for private enterprises while remaining capable of regulating the power of capital.

In June, China issued a guideline on building Zhejiang into a demonstration zone for achieving common prosperity. By 2025, Zhejiang should achieve solid progress in building the demonstration zone, with per capita GDP reaching the level of moderately developed economies. A social structure with a middle-income population as the majority should be generally developed by then.

Authorities in Zhejiang launched a detailed roadmap for 2021 to 2025 in July that aims to increase residents' per capita disposable income to 75,000 yuan ($11,560.88) by 2025. The province is also planning the layout of advanced technologies and cutting-edge industries, like artificial intelligence, blockchain and third-generation semiconductors, to reach the world's most advanced levels in some areas.