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Apparent Suicide Raises Questions Over BRI Corruption
Chairman of one of China’s biggest SOEs apparently leaps to death amid corruption probe

By: Toh Han Shih
There are unanswered questions over the apparent August 16 suicide of Chen Fenjian (above, left), a former top executive of two large Chinese state-owned enterprises (SOEs) engaged in the Belt and Road Initiative, one of which, China Communications Construction Company (CCCC), was recently sanctioned and accused of corruption by the US government.
One of BRI’s most active companies, CCCC is one of a long list of Chinese firms involved in China’s massive US$1 trillion-plus effort to build infrastructure across a huge swathe of the world. The BRI, planned by Chinese leader Xi Jinping as the capstone of China’s global expansion, has instead turned into what one critic called a “global trail of trouble” that has saddled country after country with massive debt and has been tarnished with accusations of corruption. In 2009, CCCC itself was debarred for six years by the World Bank for alleged fraudulent bidding on a Philippine highway project.
Chen was chairman of China Railway Construction Corporation (CRCC) from September 17, 2018 until his death less than two years later. He was President of CCCC from April 2014 to July 2018 and deputy chairman of the Shanghai and Hong Kong-listed company from December 2016 to July 2018. CRCC, whose revenue was RMB830.45 billion (US$121 billion) in 2019, is one of the world’s largest rail builders and has built infrastructure projects around the world including Russia and Africa. CCCC, whose revenue was RMB552.54 billion in 2019, is one of the largest port builders and dredging companies in the world
Chen fell to his death from a tall building in Beijing at the age of 58, apparently of suicide, according to Chinese media reports. Chinese police are investigating his death, reported the state-owned Global Times. CRCC, which is listed in Hong Kong and Shanghai, announced on August 18 that Chen passed away and the company’s operations are normal, but gave no further details.
CRCC’s Chinese-language website has been down for more than 10 days since Chen’s death, although its English-language website is functioning. It was only on August 29 when CRCC’s Chinese website was functional again. The CRCC website may have been down because management was deciding on the best “message” to put out, said Dane Chamorro, a Singapore-based senior partner of Control Risks, an international risk consultancy.
“The fact that the Chinese website was down so long suggests there could be an internal crisis within the company and they were stalling for time,” said a Hong Kong-based investigator who declined to be named. “It is odd that a large, listed company would have its website down so long. The website is one of the best ways for the company to provide information to the public. As a public company, shareholders want to know what is going on in the company.”
Investor confidence in CRCC was rattled after its chairman’s death, with its Hong Kong share price falling from HK$6.84 on August 17 to HK$6.15 on August 28, while its Shanghai share price declined from RMB9.27 on August 17 to RMB8.88 on August 28.
One day before Chen’s death, an investigative team of the State-owned Assets Supervision and Administration Commission (SASAC), the Chinese government body overseeing SOEs, completed its inspection of CRCC. The timing has aroused speculation on whether Chen’s apparent suicide might be linked to corruption, but there is no evidence that he was corrupt.
However. several chairmen of Chinese state-owned companies and state-owned banks have taken their lives to evade punishment and avoid revealing information on co-conspirators to Chinese investigators. Since Xi launched his anti-corruption campaign in 2012, more than 260 senior Chinese officials and company executives have died unnaturally through means such as falling off buildings, hanging, poisoning, gunshots or drowning, according to the Hong Kong-based Apple Daily.
CCCC sanctioned
The US Commerce Department sanctioned 24 Chinese companies including CCCC and some of its subsidiaries on August 27 for helping the Chinese military build artificial islands and place military installations on these islands in the South China Sea. Under the sanctions, US companies are restricted in selling products and technology to these Chinese firms.
According to a transcript of a US State Department briefing on August 26, an unnamed senior State Department official said, “In doing this, we have various aims, including, of course, to impose costs on bad actors and to encourage all sorts of parties and institutions and governments around the world to assess risk and reconsider business deals with the sort of predatory Chinese state-own0ed enterprises that we’ve identified here, to include China Communications Construction Company and its subsidiaries that have been so central to the militarization and coercion in the South China Sea.”
“CCCC, which led on the dredging, is also one of the leading contractors used by Beijing in its global “One Belt One Road” strategy. The company and its subsidiaries have engaged in corruption, predatory financing, environmental destruction, and other abuses in countries all around the world,” the senior State Department official added.
The senior State Department official cited the East Coast Rail Link (ECRL), a railway project linking the east and west coast of peninsular Malaysia where CCCC was the prime contractor. The project was initiated in 2016 while Chen was CCCC President and Najib Razak was Malaysian prime minister. The initial cost of the project at RM65.5 billion (US$15.7 billion) was several times more expensive than the market rate, which aroused much suspicion.
After Najib’s Barisan Nasional coalition lost the Malaysian election in May 2018, the ECRL project came under severe scrutiny by the new government which replaced him. In July 2018, the Malaysian Anti-Corruption Commission (MACC) raided the offices of ECRL, but to date, no corruption charges have been laid. In 2019, Mahathir Mohamad, who succeeded Najib as Malaysian Prime Minister, signed a revised deal with the Chinese parties which lowered the cost of ECRL to RM44 billion from RM65.5 billion. On July 28, the Malaysian High Court sentenced Najib to 12 years jail and fined him RM210 million on seven charges related to the multi-billion dollar international money laundering scandal involving the defunct Malaysian sovereign wealth fund 1Malaysia Development Berhad (1MDB).
In Bangladesh, CCCC’s subsidiary, China Harbor Engineering Corp, was blacklisted by the Bangladeshi government from projects after bribing an official in that South Asian nation, the senior State Department official pointed out.
In 2011, a Bangladeshi court sentenced Arafat Rahman Koko, a son of former Bangladesh Prime Minister Khaleda Zia, to six years in prison for taking over US$2.66 million in bribes from China Harbor Engineering and German electronics giant Siemens. Koko was also found guilty of laundering more than US$2.66 million to Singapore.
“In most cases, it is no surprise that these contracts can involve kickbacks. The biggest weakness of the Belt and Road Initiative is not the debt, but the fact that most of these contracts are ‘no bid’ and negotiated in secret, which leads to huge potential for corruption on both sides of the deal,” Chamorro said.
Infrastructure projects are prone to the risk of corruption because of the huge amount of funds involved and projects like road and rail require the acquisition of land or right of way, which “drive corruption on a grand scale just about everywhere in the world,” Chamorro added.
The senior State Department also cited CCCC Dredging, one of CCCC’s subsidiaries which were sanctioned by the US government. In late 2015, CCCC Dredging aborted its planned US$1 billion initial public offering (IPO) on the Hong Kong Stock Exchange. CCCC Dredging played a significant role in dredging the Spratly Island outposts, but the company was unwilling to disclose this on its IPO prospectus, the official added.
On August 27, CCCC issued an announcement playing down the impact of the US sanctions, saying CCCC Dredging accounted for only 6 percent of the new contract value of CCCC’s 2019 revenue.
“China's construction activities on its own territory are entirely within its sovereignty and have nothing to do with militarization,” Chinese Foreign Ministry spokesman Zhao Lijian told a press conference on August 27. “The participation of Chinese companies and individuals in domestic construction activities is legitimate, lawful and beyond reproach.”
The US action, Zhao said, “grossly interferes in China’s internal affairs and violates international law and basic norms governing international relations. It is hegemonistic logic and power politics that are at play here. China is firmly opposed to this.”
CRCC and CCCC did not reply to Asia Sentinel’s questions.
Toh Han Shih is a Singaporean writer in Hong Kong.
Apparent Suicide Raises Questions Over BRI Corruption
Helping third world leaders laundering corruption , it is destroying poor world economies and causing more hardships & inflation to poor countries society
Good article. So suicide/murder is part of the plan.