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AisinGioro
Talker
Joined: Sep 21, 2006
Posts: 104
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 Posted:
Sep 26, 2006 - 10:43 AM |
 
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| Post subject: Shanghai's star slips with party chief's fall |
SHANGHAI (Reuters) - Are Shanghai's days as the freewheeling, red-tape slashing golden boy of China's economic boom coming to an end?
The dismissal in a corruption probe of the city's most powerful official, local Communist Party secretary Chen Liangyu, suggests Shanghai might no longer take the lead as China pushes economic reforms and develops huge new economic projects.
The demise of one of its top political patrons shows the city's relative status is slipping as it lobbies the central government in Beijing for resources and regulatory freedom, corporate executives and analysts said.
"In past years there was an awful lot of emphasis placed on pouring benefits into Shanghai," said Arthur Kroeber, managing director of Dragonomics, a Hong Kong-based research firm.
"Now it's very clear that the government has started to pursue other channels of development."
Shanghai's spectacular economic success in the 1990s and through the early part of this decade, symbolized by the futuristic skyscrapers of the financial district, was partly based on politics.
Former Chinese President Jiang Zemin was previously a mayor of Shanghai, and he brought a train of senior Shanghai figures to Beijing with him.
But the influence of the "Shanghai gang" has been fading since President Hu Jintao became Communist Party leader in 2002. While Chen's dismissal this week was part of Beijing's efforts to fight corruption nationwide, many Shanghainese believe it would not have occurred if their city was still pre-eminent.
Shanghai, which boasts the world's busiest port, the country's main banking center and China's largest unofficial municipal population of 18 million, will remain an economic giant.
TOO IMPORTANT
In contrast to past decades, when leadership changes in China could signal drastic policy shifts, few expect the city's business-friendly environment to change. Rapid economic growth has become too important to the stability of the central government.
In a sign of continuity, the official Xinhua news agency said Chen would be temporarily replaced as city party boss by Shanghai Mayor Han Zheng. Vice Mayor Zhou Yupeng told Reuters that there would be "no change at all" to economic policies.
But corporate executives said that in future, the city might find it harder to justify special economic treatment by Beijing, and might be forced to implement central policy directives -- such as those designed to crack down on excessive industrial investment and real estate speculation -- more strictly.
While the benchmark Shanghai stock index dropped only 0.2 percent on Monday in response to news of Chen's dismissal, Shanghai-focused property stocks tumbled as much as 5 percent, showing investors fear the regulatory environment for the city's real estate market could worsen.
"I have to say the city's investor confidence will be affected to some degree by this," said a foreign banker in Shanghai, who added that Chen's dismissal was significant enough for the chief executive of her bank to be informed immediately.
"Shanghai is now looking more like a 'normal' city or province. The central government has recently given more priority to places like Tianjin, and not Shanghai any more. These things may be signs of the future."
FRAUD PROBE
Earlier this month, the government announced it would conduct a trial liberalisation of China's foreign exchange trading system in the Tianjin Binhai New Area on the northeast coast, and not in Shanghai as some had hoped.
Billions of dollars are being earmarked to develop the Tianjin area's port, rail and communications infrastructure, raising the possibility that the city near Beijing could eventually become a counterweight to Shanghai in the national economy.
The investigation into misuse of Shanghai's social security funds has over the past few months implicated at least two other city officials and several executives from Shanghai Electric Group, China's biggest power gear maker, and Fuxi Investment, one of the city's biggest private investment firms.
The way in which the probe is being conducted has, at times, seemed calculated to underline the central government's power over Shanghai.
More than 100 investigators from Beijing have taken over an entire luxury hotel near the city center, setting out in cars with tinted windows to grill officials and executives.
Hearing that officials from Beijing were in town, several local residents appeared at the hotel with petitions and complaints about problems in the city before a heavy police guard moved them away, residents in the area said.
As an individual, I don't care the status of the city, but there are still so many Chinese from other provinces coming to Shanghai to work. Half of the talents in my company are from other parts of China, our office language is Mandarin, I'm used to speaking Mandarin with my colleagues, even if they are Shanghainese  |
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Jboy
SuperStar
Joined: May 18, 2005
Posts: 1402
Status: Offline
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Sep 26, 2006 - 12:06 PM |
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This was actually the biggest news in the entire city. The news was announced at 10am and for the rest of the day you could hear citizen discuss nothing but. Though I am sure most of the expat population was oblivious |
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Shut up Leslie and drink. |
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frenchlover1999
Shanghai Royalty
Joined: Sep 18, 2004
Posts: 8730
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Sep 26, 2006 - 12:13 PM |
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For those of you who read the forum regularly, you have seen that the Frenchlover gave you a serious hint last week (and got pitted because of it). |
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That was no shark. That was my personal submarine. But enough of this polite conversation. What is the purpose of your visit? |
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AisinGioro
Talker
Joined: Sep 21, 2006
Posts: 104
Status: Offline
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Sep 26, 2006 - 12:30 PM |
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| Jboy wrote: |
| This was actually the biggest news in the entire city. The news was announced at 10am and for the rest of the day you could hear citizen discuss nothing but. Though I am sure most of the expat population was oblivious |
True, we are having a lunch break, everyone is discussing it. We talk about kleptocracy, and the prospect of lower housing price  |
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AisinGioro
Talker
Joined: Sep 21, 2006
Posts: 104
Status: Offline
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Sep 26, 2006 - 12:38 PM |
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I wouldn't mind Shanghai's fall from favor, I hope beautiful cities like Chengdu and Beijing or Hangzhou can win the favor of the central government and I'll move there. |
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thewalrus
Board Royalty
Joined: Apr 28, 2004
Posts: 7358
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Sep 26, 2006 - 01:21 PM |
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| I hope beautiful cities like Chengdu and Beijing or Hangzhou can win the favor of the central government and I'll move there. |
So you're saying you are living here only due to the fact that it's in favour with the Central Government? |
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AisinGioro
Talker
Joined: Sep 21, 2006
Posts: 104
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Sep 26, 2006 - 01:28 PM |
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No, I was born here, and it happens that Shanghai is in favor with govt. But I like these 3 cities more. |
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shanghaiceltic
Board Royalty
Joined: Sep 20, 2005
Posts: 7614
Location: Perth WA
Status: Offline
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Sep 26, 2006 - 01:29 PM |
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Just took this from a post to the News & Comments section. I read it at the beginning of this month. It just took time for the news to break through in China. FL was correct.
This appeared in the Econmist on Sept 7th.
China
Looting the aged
Sep 7th 2006 | BEIJING
From The Economist print edition
A corruption scandal in Shanghai makes political mileage for Hu Jintao
EVEN if they were well managed, China's social-security funds would find themselves hugely in the red in a few years' time, as a bulge of retired workers start demanding pensions. But recent allegations of massive corruption in the management of Shanghai's fund, involving the illicit use of $400m, reveal just how much officials can worsen the problem.
For a city that is trying to promote itself as China's sophisticated financial capital, the scandal is a serious blow. For President Hu Jintao, eager to display his authority in the run-up to an important Communist Party conclave next year, it may be beneficial. In his handling of the allegations, he has shown a willingness to crack down on waywardness in the provinces, which have been frustrating the central leadership's efforts to rein in the economy. As a particularly powerful enclave, which enjoys the status of a province, and is reputed—though evidence for this is debatable—to be a bastion of Mr Hu's political rivals, Shanghai was a perfect case for Mr Hu to act upon. More than 100 officials have been dispatched from Beijing to investigate the alleged graft, according to the government news agency, Xinhua.
China's official media have described it as Shanghai's biggest financial scandal in many years. It allegedly involves the misappropriation of one-third of the city's $1.2 billion social-security fund. Since the scandal was uncovered in July, the director of Shanghai's Municipal Labour and Social Security Bureau, Zhu Junyi, and a district government chief, Qin Yu, have been sacked. Mr Qin happens to be a former top aide of the city's party chief, Chen Liangyu, who is also a member of the ruling Politburo. Several prominent people in the business world are being questioned. On September 5th Chinese media said Wu Minglie, the chairman of one of Shanghai's biggest property developers, New Huangpu Group, had been detained.
According to Chinese press reports, the fund lent money that was used to invest in risky toll-road and real-estate projects. In theory, social-security funds should mainly be invested in treasury bonds and bank deposits, which yield very low returns. The government has been cautious about allowing funds to be put into stocks because China's capital markets are still rather rough and ready. It also fears that any loosening of controls could encourage abuses by local officials. But a lack of transparency in the management of funds, combined with pressures to make up pension deficits, still result in frequent wrongdoing. Xinhua quoted an official as saying that 16 billion yuan ($2 billion) had been embezzled from the funds since 1998.
Shanghai's case is the latest in a series of big corruption stories reported by the Chinese media in recent weeks. A deputy mayor of Beijing, a chief prosecutor in nearby Tianjin, a deputy commander of the navy and a deputy governor are among those who have been arrested. But the scandal in Shanghai has aroused particular attention because of widespread public concerns about meagre pensions and unemployment benefits as well as the fast-rising cost of health care. A commentary on one official newspaper website spoke of a “crisis of confidence” in the social-security system generated by the Shanghai case. The famous words of Lord Acton, a 19th-century historian, were quoted in another: “Absolute power corrupts absolutely.”
The Chinese media say government auditors are now examining accounts at social-security departments across the country. Such checks are conducted regularly, but this time they are being carried out by officials from other regions, in an apparent effort to minimise the possibility of cover-ups.
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Who took the cork off my lunch? W C Fields |
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I have parrallel bars at home, one for gin and one for whiskey |
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thewalrus
Board Royalty
Joined: Apr 28, 2004
Posts: 7358
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Sep 26, 2006 - 01:32 PM |
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| No, I was born here, and it happens that Shanghai is in favor with govt. But I like these 3 cities more. |
Why don't you move to these other places then? |
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AisinGioro
Talker
Joined: Sep 21, 2006
Posts: 104
Status: Offline
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Sep 26, 2006 - 01:32 PM |
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AisinGioro
Talker
Joined: Sep 21, 2006
Posts: 104
Status: Offline
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Sep 26, 2006 - 01:33 PM |
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| thewalrus wrote: |
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| No, I was born here, and it happens that Shanghai is in favor with govt. But I like these 3 cities more. |
Why don't you move to these other places then? |
Even worse job opportunities, trust me! |
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Jboy
SuperStar
Joined: May 18, 2005
Posts: 1402
Status: Offline
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Sep 26, 2006 - 01:57 PM |
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Shanghai is still going to be the face of china in the forseeable future. So don't abandon ship just yet. |
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Shut up Leslie and drink. |
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beautiful_mind0905
Board Lord
Joined: June 18, 2006
Posts: 5646
Status: Offline
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Sep 27, 2006 - 11:46 AM |
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| AisinGioro wrote: |
| Even worse job opportunities, trust me! |
There are plenty of job opportunities in Beijing... |
_________________
Women are the ones who maintain the world while men throw it into disarray with their historic brutality. |
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beautiful_mind0905
Board Lord
Joined: June 18, 2006
Posts: 5646
Status: Offline
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Sep 27, 2006 - 11:47 AM |
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Just because you were born in a city, it does not mean that you have to live in that city forever. |
_________________
Women are the ones who maintain the world while men throw it into disarray with their historic brutality. |
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shanghaiceltic
Board Royalty
Joined: Sep 20, 2005
Posts: 7614
Location: Perth WA
Status: Offline
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Sep 27, 2006 - 03:00 PM |
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AisinGioro
Talker
Joined: Sep 21, 2006
Posts: 104
Status: Offline
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Sep 27, 2006 - 03:04 PM |
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Actually Shanghainese celebrate that! |
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shanghaiceltic
Board Royalty
Joined: Sep 20, 2005
Posts: 7614
Location: Perth WA
Status: Offline
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Sep 27, 2006 - 03:06 PM |
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Yes I heard that. Many Shanghaiese seem very happy that these corrupt folk are at last getting their come upance.
Pity it wont stop people from still doing it though. |
_________________
I have parrallel bars at home, one for gin and one for whiskey |
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AisinGioro
Talker
Joined: Sep 21, 2006
Posts: 104
Status: Offline
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Sep 27, 2006 - 03:13 PM |
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I can't go too far in that regard, I'm afraid I will be arrested. Maybe I will get arrested for saying I fear getting arrested. |
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Jboy
SuperStar
Joined: May 18, 2005
Posts: 1402
Status: Offline
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Sep 27, 2006 - 03:26 PM |
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There are about 1,000 people in various governmental post in shanghai that is very nervours right about now. 30 billion RMB gone wasn't done by one person or even a small group of people.
And there are alot of shanghainese people very happy right about now. |
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Shut up Leslie and drink. |
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shanghaiceltic
Board Royalty
Joined: Sep 20, 2005
Posts: 7614
Location: Perth WA
Status: Offline
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Sep 27, 2006 - 03:46 PM |
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There was an article about 1 months to 2 years ago in the South China Morning Post about corruption in China. An unamed govt official who was interviewed stated "we do not need to build prisons for these corrupt officials, just put steel doors and bars on the buildings they work in and you will have got them all' |
_________________
I have parrallel bars at home, one for gin and one for whiskey |
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TwirlingTurd
Talker
Joined: Sep 20, 2006
Posts: 114
Status: Offline
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Sep 27, 2006 - 04:18 PM |
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Must say a high percentage of the people happy that the corrupt folks are in jail would do the same had they had the chance to steal the same money.
It's not satisfaction for justice prevailing, it's just the relief of having one less thing to be jealous about.
TT. |
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AisinGioro
Talker
Joined: Sep 21, 2006
Posts: 104
Status: Offline
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Sep 27, 2006 - 04:21 PM |
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You hit the mark. But I don't steal, never will! |
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TwirlingTurd
Talker
Joined: Sep 20, 2006
Posts: 114
Status: Offline
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Sep 27, 2006 - 04:26 PM |
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Had you had the chance, you would, just like anyone else.
And like everybody, you deny it in public but drool and lick your thick lips in private.
Or should I say lick thick privates in public?
Well. |
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AisinGioro
Talker
Joined: Sep 21, 2006
Posts: 104
Status: Offline
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Sep 27, 2006 - 04:29 PM |
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I DON'T !! YOU DO!! YOU DO!!!! |
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