Following the September arrest of Evergrande chairman Xu Jiayin, Chinese social media has been awash with revelations about the former billionaire. Mr. Xu has reportedly confessed to collusion with a large number of high-ranking officials, with whom he had illicit financial dealings.
“The admission of Xu Jiayin’s ties to high-ranking officials has sent shockwaves throughout China,” according to a report last week on YouTube channel “China Truths,” a production of digital platform Ganjing World.
Soccer Bribes, Dance Troupe Scandal
According to one online report, Mr. Xu spent nearly 270 million yuan (about $37 million) to foster relationships with China’s General Administration of Sport and the Football Association. He reportedly paid 80 million yuan (about $11.14 million) in bribes to the sports administration’s deputy director and bribed a number of soccer administration officials, including some who were arrested earlier this year.Evergrande purchased Guangzhou Football Club for 100 million yuan in 2010, subsequently changing its name to Guangzhou Evergrande Football Club. The Evergrande name became synonymous with China’s booming soccer scene as it poured money into the sport in the hopes of becoming a world soccer power.
Chinese media has also been buzzing lately with stories about Mr. Xu’s Evergrande Song and Dance Troupe. Founded in 2010, the performing group featured hundreds of dancers. Its annual budget was enormous, with wages alone costing about 100 million yuan ($13.7 million) annually. Salacious rumors allege that the troupe’s duties went far beyond dancing; the performers were said to offer private services to Evergrande’s executives or CCP officials.
Power–Money Collusion
In China, for a company to become as big as Evergrande, there must be power–money collusion behind the scenes, with officials from various government agencies giving it the green light.Independent commentator Zhuge Yangming told The Epoch Times that if the revelations about Mr. Xu’s financial dirty dealings are true, the implicated officials at all levels will definitely feel uneasy, wondering whether they have also been exposed.
And if the revelations were made at the behest of Mr. Xi, those unlucky officials are likely to be the next targets of the political purge.
“The most nervous officials at the moment are those who have accepted Xu Jiayin’s bribes but are not yet in trouble,” commented one online post.
The ‘White Glove’
Mr. Xu was known to be a “white glove” for CCP interest groups, particularly for prominent political figure Zeng Qinghong.In China, a “white glove” is an intermediary who conducts a business in the foreground with CCP elites backing him. A white glove “does the dirty work,” allowing CCP officials to keep their hands clean.
As a white glove, Mr. Xu most likely did not expect that the CCP would sacrifice him to address the real estate debt crisis. However, Mr. Xi clearly didn’t care to follow the old rules.
Mr. Zeng, whose family owns Fantasia Holdings Group, a large property developer, was a close ally of former CCP general secretary Jiang Zemin. He was instrumental in helping Jiang hold onto power. For years, Mr. Zeng was the primary force behind the CCP’s organization and personnel and controlled the pro-Jiang faction.
“I think Xi Jinping is worried that the anti-Xi forces would form an alliance with Zeng Qinghong’s family, and if that happens, he will be in even greater trouble. That’s why he wants to handle Xu Jiayin’s case quickly and use this opportunity to crack down on the Zeng family,” Mr. Zhuge said.
Mr. Xu is in an unfortunate position. Former Chinese journalist Li Feng told The Epoch Times that Mr. Xu’s arrest may be a setback for Mr. Zeng’s faction. However, it’s hard to predict whether Mr. Xi will take action against Mr. Zeng directly.
“If Xi Jinping now affects Zeng Qinghong’s interests, such as Zeng Qinghong being investigated or deprived of his family’s interests as a result of Xi’s anti-corruption campaign, the two sides may end up in a hostile and incompatible situation,” Mr. Li said.
“At the same time, they both know that to protect their own interests, they must retain the CCP’s rule,” he added.
Shifting Blame
Japanese journalist Akio Yaita, director of the Taipei branch of Japan’s Sankei Shimbun national newspaper, said in a Facebook post that he believes that Mr. Xi has another main purpose in arresting Mr. Xu, which is to shift the responsibility for China’s economic deterioration onto others.In the future, if migrant workers aren’t paid, or properties aren’t delivered to buyers who have paid for them, it will be convenient to blame it all on Mr. Xu, Mr. Akio said.
“After the arrest of Xu Jiayin, other big names in the private sector may also run into trouble,” said Mr. Zhuge. The purge, and the scapegoating of Mr. Xu, might take pressure off in the short term.
Nonetheless, he said, “No matter who Xi Jinping arrests, it won’t change [China’s] economic decline, and it will only make the CCP’s crisis more and more dangerous.”
