Speculation rife as Beijing's elite puzzle over loss of their clubs

Mainland stock markets may have had their worst performance this year, down 20 per cent and the international community has been nervously watching the European sovereign debt crisis and the plunging euro.

But Beijing's rich and elite have been transfixed by something much more mundane and personal over the past week - the decision by police on May 11 to raid and close the city's top-notch nightclubs for six months. Many a dinner-table conversation is lamenting the sudden loss of venues where the upper crust could wallow in the most decadent luxury, drink the most expensive wine and be surrounded by beautiful, fair-skinned young hostesses. And the participants in those conversations are all wondering why.

It is well known that owners of the clubs, including the Passion Club and No 8 Mansion, are well connected, with a few even close to the mainland's most powerful families. Over the past decade or so, the clubs remained open despite the city's annual campaigns to combat the booming sex industry.

State media have hailed the latest crackdown and in particular heaped praise on Fu Zhenghua, the city's new police chief, who reportedly ordered the shutdown and personally orchestrated the raids. For someone who just took up the new job and should care about his future, shutting the clubs and standing up against powerful families was more like career suicide than a sound decision to make his mark, some observers say.

Perhaps Fu, 55, has the direct backing of the mainland leadership, as some have speculated. However, there is little sign indicating Fu, a career crime-buster, has any direct link to Zhongnanhai, the Communist Party headquarters.

This has naturally stirred up intense speculation that the latest crackdown on the sex industry could escalate to a wider campaign similar in scale to the anti-triad crackdown in Chongqing . In June last year, Chongqing party secretary Bo Xilai took advantage of an unsolved murder to launch a citywide crackdown on the so-called mafia elements and their protectors in the judiciary system, resulting in arrests and convictions of hundreds of criminals and judiciary officials.

This culminated in the recent death sentence for Wen Qiang, a former police chief. Although Bo's decision was controversial, he attracted heavy praise from ordinary mainlanders nationwide, with some analysts speculating that his decision may have strengthened his chances of stepping up to become a member of the Politburo Standing Committee in 2012. Indeed, the latest speculation in some parts of the country has been that the crackdown in Beijing could pave the way for Bo, a well-known princeling and a son of former party veteran Bo Yibo, to be transferred soon to Beijing and become its party secretary, replacing Liu Qi .