China’s Rail Minister Could Face Prosecution

May 29, 2012 Updated: October 1, 2015
former railway minister Liu Zhijun
Photo taken on March 5, 2009 shows China's former railway minister Liu Zhijun (R) being interviewed in Beijing. (STR/AFP/Getty Images)

China’s former rail minister, Liu Zhijun, will face prosecution over allegations of corruption, the country’s leadership has announced. This represents the result of a 15-month investigation into Liu and the Chinese Ministry of Railways, which began last February after Liu was suspected of corruption and suspended from his eight-year tenure as railway minister.

The Chinese Ministry of Railways is often seen by observers as a state within a state, and has long been under the control of the faction of former regime leader Jiang Zemin. Liu, aged 59, was said to have been part of Jiang’s faction, and rose through the ranks to become the railway minister in 2003 under Jiang’s influence and protection.

However in 2011 Liu was linked to a corruption case involving a Chinese businesswoman named Ding Yuxin. Ding had illegally obtained almost one billion yuan ($158 million) in commissions by acting as an intermediary between the railway ministry and private contractors, according to the Financial Times, which cited unspecified Chinese media as its source. She is said to have split the money with Liu, while also providing him with a series of mistresses.

Liu was then dismissed from his position as railway minister on Feb. 12, 2011 and placed under investigation for corruption.

During his tenure as railway minister, Liu had presided over the rapid expansion of China’s high-speed rail network. The safety of the high-speed rail network was called into question following a tragic accident which happened just months after his dismissal, when two bullet trains collided in Wenzhou on July 23, 2011, killing 40 and injuring 172. A People’s Daily report stated that “the tragedy (has) been blamed on improper management.”

In the aftermath of the accident, Wen Jiabao was widely reported to have burst into a rare scene of outrage and vehemently criticized the railway ministry as being an “independent empire.” He then pressed for further investigations into the railway ministry, which had already begun following Liu’s dismissal, and this resulted in further cases of scandals and corruption in the ministry being uncovered.

A source told The Epoch Times that after Zhou Yongkang and his faction had quietly initiated a hike in railway ticket prices, which provoked a public backslash, and then following the dismissal of Liu shortly afterwards, an urgent notice was issued: “Recently the Central News Agency has conducted undercover investigations into the railway ministry regarding the ticket price hike. No one is permitted to accept interviews. At any sign of undercover reporters, report to your superior immediately. Special attention must be paid to opinions by business owners. This is a very important issue. Any necessary arrangements must be carried out right away, and any problems must be promptly reported to a party propaganda assistant.”

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Liu was officially expelled from the Chinese Communist Party (CCP) on Monday and his case has been referred to “judicial organs,” according to the CCP mouthpiece, the People’s Daily. The report cited his “discipline violations” and the Wenzhou train collision as contributing factors to his expulsion.

The recent developments do not bode well for Chinese Security Chief Zhou Yongkang, of whom Liu is understood to be a political ally. Once a key figure in the Party, Zhou has since been weakened in political power following the fall of his ally Bo Xilai, another key party official being investigated for corruption.

Washington, D.C.-based China expert Shi Zangshan said, “Politically, the challenge by Zhou Yongkang to Wen Jiabao has ended in utter failure. However, Zhou has put up a tough fight economically.The corruption and price hike by the railway ministry were long under the watchful eyes of both Hu and Wen. In fact, the railway ministry has taken a leading role in hindering the economic policy of Wen. Nonetheless, the sudden dismissal of Liu Zhijun, and the message sent out by the rail ministry all hinted that Zhou was in dire trouble. The moves by Hu and Wen came as a warning.”

Economist Hu Xingdou of Beijing Institute of Technology told Radio Free Asia, that the purging of Liu was not enough to restore the public’s faith in the ruling Party.

“This is far from enough for a highly centralized society,” he was quoted as saying. “Fundamentally, it is more important and effective to establish property openness, press freedom, and judiciary independence in governance.”

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