Markets

China Vows Anti-Corruption Crackdown on Financial Sector

 

China’s top decision-making body has pledged to increase its efforts to crack down on corruption in the financial sector and in public firms, according to a report by Chinese state media Xinhua.

“(We) need to…promote those who do not dare to, cannot and do not want to (engage in) in corruption,” officials said in the meeting chaired by Chinese President Xi Jinping, according to a Xinhua readout.

Officials said the efforts were aimed at increasing the sectors’ economic contributions. Their remarks came a day after party inspection teams concluded investigations into dozens of state-owned enterprises.

 

Also on AF: China Bans Top Nomura Investment Banker From Exiting Mainland

 

The vow to step up anti-graft efforts comes at a time when Beijing is already cracking down on its $57 trillion financial sector.

Over the past year, that has led to developments such as top tech dealmaker Bao Fan being “taken away” by authorities for a corruption investigation and banking and investment sector employees being instructed to taper down their opulent lifestyles.

In March, Beijing also announced plans to set up a new watchdog for the financial sector, the National Financial Regulatory Administration (NFRA), to oversee all aspects of the sector, apart from the securities market.

“The meeting emphasised that (we) should continuously enhance the … core competitiveness of state-owned enterprises, and … increase the efforts of financial enterprises to serve the real economy and national strategy,” the Xinhua report said.

Ensuring that businesses in the country serve “the real economy”, and the country, is a key aspect of the Chinese Communist Party’s ‘common prosperity’ agenda.

Last year, Xi vowed that China will steadfastly promote common prosperity and improve wealth distribution. The drive has already led to salary reductions in finance and other sectors.

 

 

‘Minimising risks’

The Xi Jinping cabinet — including officials handpicked by the Chinese president — have not been spared by the anti-corruption crackdown either. Top officials including former foreign minister Qin Gang and defence minister Li Shangfu seem to have ‘disappeared’ over the past few months.

The vanishing of officials in China is often followed by the announcement of investigations into suspected disciplinary infractions but Beijing has yet to explain why Qin and Li remain out of public sight. Qin has been missing for three months and Li for one month.

With tensions over Taiwan, the South China Sea, and over US export controls that target the Chinese military and advanced tech sector, Xi’s rule has been marked by a focus on national security risks within the party, government, and large industries.

The Wall Street Journal reported earlier this month that foreign minister Qin was removed due to an “extramarital affair” during his tenure the top Chinese diplomat to the US, which created a ‘national security’ issues.

“It is necessary to … establish a mentality of red lines and (willingness) to be extreme, take effective measures to prevent and resolve major risks, and firmly maintain the bottom line of safety,” the politburo was quoted as saying in Wednesday’s meeting.

 

  • Reuters, with additional inputs from Vishakha Saxena

 

Also read:

 

China Bankers to Shun ‘High-End Taste’ Fearing Regulatory Ire

 

JD.com Cuts Exec Salaries Under ‘Common Prosperity’ Pressure

 

Investors Dump Private China Firms, Embrace ‘Common Prosperity’

 

China’s ‘Common Prosperity’ All About Control, Says Academic

 

Missing China Banker Wanted to Move Wealth to Singapore – FT

 

Chinese Minister, ‘Mistress’, Rocket Chiefs All Missing – A/Sentinel

 

 

Vishakha Saxena

Vishakha Saxena is the Multimedia and Social Media Editor at Asia Financial. She has been working as a digital journalist since 2013, and is an experienced writer and multimedia producer. As a stock market trader and investor, she is keenly interested in economy, emerging markets and the intersections of finance and society. You can tweet to her @saxenavishakha

Recent Posts

China’s PBOC Has Room for More Reserve Ratio Cuts: Ex-Official

A former People's Bank of China official predicted on Sunday that policymakers would implement a…

52 mins ago

Wealthy Families, Private Firms Moving Billions Out of China – NYT

Rich Chinese families and private companies have taken or sent an estimated $50 billion a…

2 hours ago

Indonesia, ADB, Owners to Shut Coal Power Station Early

Jakarta and the Asian Development Bank have agreed to a deal that will see a…

2 hours ago

COP28: Over 110 Nations Join Deal to Triple Renewable Energy

The pledge by over half the world's countries to triple renewable energy was perhaps the…

1 day ago

Toyota and Honda Announce Cuts to Car Production in China

Honda Motor said on Saturday it was dismissing about 900 workers at its JV with…

1 day ago

US Pledges $3 Billion for Green Climate Fund at COP28

The US will give $3 billion to the Green Climate Fund, sources said Saturday. The…

1 day ago