Corruption in China

Learn from past mistakes, warns Shanghai mayor

PUBLISHED : Friday, 25 January, 2008, 12:00am
UPDATED : Friday, 25 January, 2008, 12:00am

A scandal involving misuse of pension funds had smeared Shanghai's image, highlighting the need for better institutions as the city seeks to become an international financial and trade centre, Mayor Han Zheng said yesterday.

The case, which came to light in 2006, implicated more than 25 government and state company officials, including former Shanghai Communist Party Secretary Chen Liangyu , who was sacked for his role in embezzling from the fund.

'Violations committed by Chen Liangyu and the social security fund case had extremely serious consequences, caused enormous damage and have left us with grave lessons to ponder,' Mr Han told the annual session of the Shanghai People's Congress. 'They have brought disrepute on the party and the nation, and projected a negative image of Shanghai's efforts for reform and development.'

He gave no hint about the fate of Chen, who is awaiting trial.

The case was believed by many to be the outcome of a political struggle as President Hu Jintao sought to remove political opponents from the powerful 'Shanghai Gang' of leaders from the city.

After Chen's removal, the central government shuffled the city's leadership, introducing officials without links to Shanghai.

When the congress ends next week, deputies will confirm several new government appointments, with speculation over whether even Mr Han will retain his post. 'This year will witness the beginning of a new Shanghai administration,' Mr Han said, but gave no other details.

The chairman of Shanghai's municipal Chinese People's Political Consultative Conference, Jiang Yiren, is expected to step down and be replaced by Executive Vice-Mayor Feng Guoqin . Recently appointed Vice-Mayor Tu Guangshao is expected take over the financial portfolio from Mr Feng.

The chairman of the Shanghai People's Congress, Gong Xueping , is also thought to be leaving, with vice-chairman Liu Yungeng tipped to replace him.

Mr Han promised to deliver double-digit growth this year with a forecast of about 10 per cent. He gave no figure for last year, but said average annual gross domestic product growth for the past five years was 12.6 per cent.

Shanghai would increase its GDP to 2 trillion yuan within the next five years, up from 1.2 trillion yuan last year, Mr Han said. Hosting the World Expo in 2010 would boost the local economy, he added.

Mr Han also pledged to make growth more sustainable and promote integration with the rest of the Yangtze River Delta area.

'We must proactively explore new paths to build Shanghai into a modern world-class city with a socialist identity. We must preserve the city's essential qualities epitomising a modern China and give full play to the city's several roles as a magnet, a hub, a logistics centre and a locomotive,' he said.