Bo’s Fall and the Macau Web

Bo Xilai, the former Party secretary of the municipality of Chongqing, was removed from his post on March 15 after a flurry of rumors dominated the lianghui (two-sessions) of the National People’s Congress (NPC) and Chinese People’s Political Consultative Conference (CPPCC) about Bo’s demise. Rumors swirled in the opening days of the two sessions after the South China Morning Post reported that Hu Jintao called Wang Lijun a traitor in an internal briefing of the CPPCC a week earlier. The worst came when Premier Wen Jiabao criticized Chongqing party members for the Wang Lijun scandal near the close of the NPC session culminating in Bo’s demotion a day later. [1]

In recap, the downfall of Bo was set off by a chain of events starting with the Wang Lijun scandal, where the former vice-mayor and police chief of Chongqing entered the U.S. consulate in Chengdu to seek asylum. Although the circumstances are unclear of why he entered the consulate and what might have been discussed, it was clear that Wang had possibly crossed swords with his former patron, Bo, and the Princeling faction. Wang Lijun has been protected by Bo and by extension, the Princeling faction since his service under Bo in Liaoning province. During the crackdown of mafia linked corruption in the municipality of Chongqing, Wang had become close friends with Weng Zhenjie, arguably the most powerful mafia boss in the municipality that was untouched by the crackdown of Bo.

Why was Weng unscathed? The root of power for Weng is derived from his wealth and reputation with China’s military industrial complex where, after he left the PLA in the 1990s, he joined the Carrier (Kaili) Group, which is one of the two main arms trading companies in China. The Kaili Group is controlled by Ye Xuanning, the spiritual leader of the Princeling faction and son of Ye Jianying, a former PLA general and the 5th NPC Chairman. Ye Xuanning is also the current Director of the liaison office of the General Political Department of the PLA. More importantly, Ye’s father had helped Mao establish pre-eminence over the Chinese Communist Party (CCP) during the early days of the Party while protecting Zhou Enlai from the Kuomintang (KMT). Furthermore, during the era of Deng’s rise, his father prevented assassination attempts on Deng’s life as well as helped to overthrow the Gang of Four.

Now back to modern day, Weng’s association with Ye Xuanning meant that he is protected by a family deeply associated with the PLA and established with other leading families of China. Although Weng makes no direct deals or associations with the Ye family, he sits on the board of major Chinese companies with the families key financial office, Li Junyang, and he has made connections through his gambling habits in Macau. Furthermore, Weng runs an environmental organization with the brother of Xi Jinping. To top it off, Weng had also donated RMB100 million to the Chongqing police force to ensure their health in the event they are wounded from Bo’s mafia crackdown campaign. [2]

Looking at the Wang Lijun scandal, one ponders then why would someone connected with such a powerful patronage network have run aground with luck? The actual reason for Wang’s dash for the U.S. consulate in Chengdu remains shrouded in mystery along with his sudden fall from grace with the Princelings. According to the Hong Kong Economic Times, there might have been factional infighting between Shanghai and Chongqing within the Princeling faction. [3]However, the scandal allowed Hu Jintao and the Communist Youth League (CYL) faction to go on the offensive against the Princeling faction.

What did the CYL faction bargain with to get the Princeling faction to accept Bo’s fall? The real answer is unknown. However, it is possible that Wang Lijun had an extensive knowledge of how deep the corruption network reached in Chongqing but of greater threat could be his knowledge of the associations between Weng, Xi, and Ye. As Beijing got a hold of Wang Lijun after his sudden “medical leave”, it meant that Hu had acquired ammunition that could potentially coerce the Princeling faction’s next leader, Xi.  A compromise might have been reached when they jointly allowed for Bo’s dismissal. To add more to the mystery, Zhang Minyu, a tycoon from Chongqing, had been publicly saying that he had a recording of Wang Lijun’s dirty secrets, which led him to be arrested by Chongqing security forces in Beijing on March 14. The awkwardness of the last sentence was that Chongqing security forces would have no authority in Beijing as the central government would have absolute authority over the deployment of security forces in the capital. The arrest of Zhang and his resulting disappearance from public could have signaled that a consensus was already reached in high power politics where the government would draw a distinct line between Bo and the rest of the Princeling faction. [4] [5]

Prior to the possible consensus that led to the removal of Bo, Bo Xilai did make two high profile public appearances in the preceding month once in Macau with Edmund Ho, the former chief executive of the administrative region, on February 23, and a second time with the founder and owner of Foxconn, Terry Gou, on the following day.[6]Although the reason for meeting Terry Gou did not seem to go beyond an investment agreement for Foxconn to bring factories and R&D centers to Chongqing, the meeting with Macau’s former chief executive could have had other implications. [7]

Edmund Ho had been the chief executive of Macau between 1999 to 2009 when he was selected by Zhu Rongji, the former Premier, to take up the position after the administrative region’s return to China. Interestingly, Edmund had been on the same committee handling Macau’s return as Ye Xuanping, the former governor of Guangdong and son of Ye Jianying. On the same committee was also the son-in-law of Ye Jianying, Zou Jiahua, who is married to his daughter, Ye Xiangzhen (also known as Ling Zi). Ye Jianying was not just a great PLA general but in the days after his military career, he was selected to become the first mayor of Guangzhou since he was born in Guangdong and was associated with the Guangzhou Uprising, which contributed to the fall of Imperial China. It is unclear whether only business was discussed, but given the associations Edmund has, it is distinctly possible that more than just business was discussed between the two. [8] [9]

Reviewing all these complex relationships while making some implied associations, one can argue that the Ye family through its history in the Guangdong province has a diverse relationship with both the Princeling and CYL factions. It seems the Ye family has harnessed a myriad of relationships with both the elites and populist market reform factions.[10] Furthermore, their dealings in Macau, a city infamous for money laundering activities through junkets, might have granted the family with a very deep set of knowledge about many powerful members of the CCP. In the end this is all speculation, but if these presented assumptions are true, then one can also conclude that Macau could have a role in the “dark side” of power politics in China.  With Bo making high profile appearances before his downfall and information scarce on the situation thereafter, it is nearly impossible to gauge the truth. Regardless of the various foods for thought, the conclusion remains the same: Bo could not avert the fate of a setting Red Star.

Corrections (3-27-12): Thanks to the Economonitor audience, it has been brought to my attention that there were some factual discrepancies between translated sources and the original. The largest discrepancy was the fact that Bo Xilai did not meet Edmund Ho or Terry Gou in the Guangdong province. Rather it was the other way around with Edmund and Terry visiting Chongqing and Bo Xilai. With the fact that Edmund visited Chongqing and not the other way around, the plausible political relationship between the two’s meeting weakens. Similar to Terry’s visit, it is likely that Edmund then was just there for business. However, as information is very scarce, I would keep the political reason for the meeting as food for thought. I could not find information regarding whether the meeting was arranged soon after Edmund’s visit to Chongqing in late 2011, or whether it was planned very close to the actual date of meeting say sometime within a week before Wang Lijun’s scandal or anytime thereafter. The timing of the meeting could be of importance although it would still remain within the realm of speculation.

2 Responses to "Bo’s Fall and the Macau Web"

  1. Mikecheck   May 8, 2012 at 2:04 am

    Why does it seem strange that the son and son-in-law of Ye Jianying would be on the same Macau return committee as Edmund Ho? The Ye family is from Guangdong and have long-term political and business ties to almost anything that would touch Guangdong. Making any connection here with Bo based on him meeting Ho and Ho "knowing" the Yes seems like a bizarre stretch.

    • Kevin Y.   May 8, 2012 at 5:36 pm

      If the post comes off as implying the Edmund-Ye family as being strange, then it could be my choice of words that was the problem. I was trying to state that the relationship is implied. And for the case of Bo's relationship to the Ye family, it isn't just based on the case of Edmund's meeting but more onto the implied history of the modern Chinese military and prominent families of China, which I don't go in depth into since that can get as long as a book.