Limited backlash after foreign media probe Chinese officials' hidden wealth

While the reports may embarrass Chinese leaders, the government may be mindful to avoid a spiral of negative reports and a further backlash.

By , Correspondent

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    China's President Xi Jinping stands in the Great Hall of the People in Beijing, Nov. 13, 2013. A report released this week by the International Consortium of Investigative Journalists' found evidence of some of China's top leaders, or their family members, using offshore tax havens.
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Officials in China are lashing back at an international group of investigative journalists for its report on piles of money moved to offshore tax havens by some of the country’s elite, but are expected to keep the retaliation brief to avoid more negative coverage.

China blocked the International Consortium of Investigative Journalists’ website from domestic views following its report this week based on 2.5 million leaked financial records from the British Virgin Islands and Samoa. It says 15 of China’s wealthiest people and relatives of the top leaders have moved money to tax havens in those countries. Beijing also blocked four foreign news websites.

Although the report further embarrasses China, where leaders were suspected of denying visas for foreign journalists who covered former premier Wen Jiabao’s family wealth in 2012, the Communist government may curb its anger this time to avoid a self-destructive spiral of negative reports, more backlash, and then more reports.

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“If they introduce a strong hand to fix the journalists, that will create more problems for both sides,” says Andrew Yang, a China-specialized professor with National Sun Yat-sen University in Taiwan, who believes that China may become more “honest” with the foreign media in order to protect its image.  

The journalist group’s report says between $1 and $4 trillion in “untraced” assets have left China since 2000. Among the 22,000 Chinese clients involved, the report says, were Chinese President Xi Jinping’s brother in-law, a first cousin once removed of former president Hu Jintao, and two relatives of Wen Jiabao.

Beijing worries particularly about news reports that imply wrongdoing by Communist party officials, who hope to stay clean as the Chinese public grows weary of corruption and the government pursues an anticorruption campaign. 

China already has legal control over its domestic media. But it has retaliated less against negative coverage in the foreign media since the 2008 Beijing Olympics. It realized then that some media will write what they want regardless of the official line, a veteran public relations firm executive in Beijing says.

“The order of the day is the domestic issues,” he says. “There isn’t as much obsession about who’s saying what about them. They do worry about [graft] issues becoming public, but I think they’ve grown up around how they handle them.”

The journalist group’s report withholds the names of some contributors to the report, but calls Taiwan’s CommonWealth magazine, Hong Kong newspaper Ming Pao, and German newspaper Süddeutsche Zeitung as “partners” in the investigation.

China has expressed displeasure over the journalist consortium’s report but hinted at no long-term follow-up. Foreign ministry spokesman Qin Gang told reporters this week the report was “hardly convincing” and that it raised “suspicions over the motives behind it.”

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