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EL ESPECTADOR

China Hunts Fugitives As Corruption Crackdown Goes Global

In its bid to root out financial corruption, China's government is hunting down fugitive suspects from Canada to Colombia, U.S. and Australia.

Alleged smuggling kingpin Lai Changxing signs a warrant issued for his arrest as he arrives at the Beijing Capital International Airport on July 23, 2011.
Alleged smuggling kingpin Lai Changxing signs a warrant issued for his arrest as he arrives at the Beijing Capital International Airport on July 23, 2011.
Daniel Canal Franco

BOGOTA —Wu Ping is the first Chinese citizen facing charges of economic wrongdoing deported from Latin America. But despite his debt, he's considered a small actor whose misdeeds pale in comparison to many multimillionaires who have disappeared from China without leaving anything but a criminal dossier behind.

"I went to Colombia, as it seemed the most remote place on the planet," Wu told the Chinese daily Qianjiang Evening when he returned to China in police custody. "I wanted to return to China. I missed my family, but my family would not let me, for my debts. My creditors wanted to lynch me."

Wu had fled after buying about $650,000 worth of goods he couldn't afford. He did odd jobs in Colombia for two years as "you don't need work papers there," and says he lived in constant fear of a natural disaster or the drug dealers he could see on his street.

When the Zheijiang police department located him, they launched an operation with Colombian police that led to his Sept. 2 arrest in Bogota. Wu had already distributed his goods across Europe but had not yet been paid.

There are many more like Wu, but dealing in much bigger figures, who haven't been tracked. That's because, says Liao Ran of Transparency International, "Firstly, civil servants must make a detailed declaration of their assets and their origins. Secondly, the financial system facilitates capital flight, and lastly, money laundering controls are very weak."

Businessmen who prospered during China's economic boom and have since faced charges such as corruption, fraud, illegal funding or embezzlement of public funds have fled the country and are termed "economic fugitives." The Chinese government has launched an unprecedented global campaign to catch them, wherever they are. "When the immigration police arrived, I knew something was up," Wu says, recalling his arrest.

Xi's pet project

This is Chinese President Xi Jinping's "Fox Hunt" operation — to identify, find and bring back the fugitives with international help. The anti-corruption campaign has already netted one big fish, Zhou Yongkang, China's former public security minister and so-called "oil czar." Arresting him would be like the U.S. nailing someone who simultaneously heads the CIA and Halliburton.

The measures have made Xi popular amid China's problem of "generalized" corruption of businessmen paying bribes and officials receiving them, says historian James Palmer.

One of the "foxes" to disappear is Liao Rongna, the Zhengling Group magnate cited in the 2009 Hurun Report as one of the 100 richest Chinese. When police arrived at his corporate offices in Liuzhou, they found 1,500 contracts worth some $520 million, which Liao had not honored.

Liao, who founded 20 companies in different sectors, isn't the only one in his family suspected of being a scam artist. His younger son, Zhengling, was held in June, and his wife, Yi Zhiqun is on the run. In August, Interpol issued a Red Notice against Liao Rongna, and President Xi hopes to smoke him out of his lair with foreign help.

He may well be in the United States, Canada or Australia, these being "the favored destinations for economic fugitives," says Liao Ran. Their strong judicial systems make it hard for them to be deported. "Precisely for the solidity of their systems, whoever can afford a good lawyer can have a good defense," Liao Ran says. Also, none of these countries has an extradition treaty with China.

China has repatriated 730 suspected economic criminals since 2008 from 54 countries, and 150 are thought to be living in the United States right now.

In evading deportation, they often say that rights are not respected in China. Their lawyers say they could be executed if convicted of economic malfeasance and that, until recently, torture was deemed a legitimate interrogation tool there. Such arguments helped Lai Changxing, the best known fugitive of the past decade, remain safe in Canada for 12 years.

In 1999, Lai discovered he was to be arrested for allegedly bribing state officials and having led a trafficking ring for a decade. He immediately left Xiamen, where he had built his empire, for Hong Kong, from which he fled to Canada three days later. In Xiamen, he had built the Red Mansion motel, a copy of the Forbidden City where he entertained party officials. People began to call him the Emperor, and he helped create a new expression there — "rich as Lai."

He was finally deported to China in May 2012, where he was sentenced to life imprisonment, after having been convicted of trafficking and bribing 64 officials from 1996 to 1999.

Xi's anti-corruption campaign can be seen as a step toward a new era, wherein a more mature China views itself as a frontline, and first-class, global player.


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Future

Livestream Shopping Is Huge In China — Will It Fly Elsewhere?

Streaming video channels of people shopping has been booming in China, and is beginning to win over customers abroad as a cheap and cheerful way of selling products to millions of consumers glued to the screen.

A A female volunteer promotes spring tea products via on-line live streaming on a pretty mountain surrounded by tea plants.

In Beijing, selling spring tea products via on-line live streaming.

Xinhua / ZUMA
Gwendolyn Ledger

SANTIAGO — TikTok, owned by Chinese tech firm ByteDance, has spent more than $500 million to break into online retailing. The app, best known for its short, comical videos, launched TikTok Shop in August, aiming to sell Chinese products in the U.S. and compete with other Chinese firms like Shein and Temu.

Tik Tok Shop will have three sections, including a live or livestream shopping channel, allowing users to buy while watching influencers promote a product.

This choice was strategic: in the past year, live shopping has become a significant trend in online retailing both in the U.S. and Latin America. While still an evolving technology, in principle, it promises good returns and lower costs.

Chilean Carlos O'Rian Herrera, co-founder of Fira Onlive, an online sales consultancy, told América Economía that live shopping has a much higher catchment rate than standard website retailing. If traditional e-commerce has a rate of one or two purchases per 100 visits to your site, live shopping can hike the ratio to 19%.

Live shopping has thrived in China and the recent purchases of shopping platforms in some Latin American countries suggests firms are taking an interest. In the United States, live shopping generated some $20 billion in sales revenues in 2022, according to consultants McKinsey. This constituted 2% of all online sales, but the firm believes the ratio may become 20% by 2026.

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