China’s finance minister sacked

By Peter Harmsen, BEIJING, AFP

Chinese President Hu Jintao on Thursday sacked his finance minister amid a major political shake-up ahead of the ruling Communist Party’s crucial five-yearly gathering.

Jin Renqing, who oversaw the longest stock boom in Chinese history during his four years in the post, was removed and replaced by Xie Xuren, the head of the nation’s tax bureau, the official Xinhua news agency said.

Four other new ministers were appointed on Thursday — on top of a string of other high-profile changes in recent months — as the political establishment braces for the party’s crucial Congress that opens on October 15.

Hu is widely seen to be reshaping the top echelons of power so that he can consolidate and strengthen his base at the Congress for another five-year term.

“The Congress is like Chinese New Year. You try to clean your house beforehand,” said Jean-Pierre Cabestan, a political scientist at Hong Kong Baptist University.

Aside from the sacking of Jin, Xinhua said that China’s parliament had also approved new ministers in the state security, personnel and supervision portfolios. The supervision ministry oversees graft within the government.

A new minister was also appointed to take over at the commission that is in charge of China’s space and missile program.

An official with the information office of the State Council, or cabinet, said Jin had tendered his resignation for “personal reasons”.

Some press reports suggested that he was involved in a sex scandal, fitting in well with Hu’s desire to be seen as cracking down on corruption and moral problems within the party ahead of the Congress.

Hong Kong’s influential Ming Pao newspaper said Jin was sacked after he introduced a woman to Chen Tonghai, the chairman of oil giant China Petroleum and Chemical Corp (Sinopec), who resigned in June under suspicions of graft.

While not mentioning Jin specifically, Hu said in comments published in the People’s Daily, the party’s mouthpiece, on Thursday that there were ethical and other problems within the leadership of China’s financial team.

“In the financial system, we must strengthen efforts to ensure clean governance and behavior becoming of the party,” the paper quoted Hu as telling the politburo on Wednesday.

“We must raise the professional ethics and the ideological and political quality of all financial personnel, especially those in leadership positions.

“We must ensure a new healthy atmosphere, combat unhealthy trends and evil practices, and create an overall benign atmosphere.”

China’s stock market did not see any visible impact from the announcement of Jin’s removal, with the benchmark Shanghai Composite Index closing up 1.14 percent for the day.

This reflected the relatively moderate importance of the finance and other ministers in China’s political system, where real power rests with the politburo’s standing committee, analysts said.

“In terms of economic policy, the key figure is the premier of the cabinet,” said Zhang Xin, a professor of public administration at Beijing’s Renmin University.

“The finance ministry implements whatever policies the cabinet decides.”

The government official who confirmed Jin’s “resignation”, speaking on condition of anonymity, said he had been appointed vice-director of the State Council’s Development Research Center, a think tank.

The position of vice-director at the center is equivalent to the rank of vice minister in China’s complex political system.

Xie, 59, was until Thursday head of the State Administration of Taxation, the same position Jin held before taking over at the finance ministry.

Other high-profile politicians who have lost their posts ahead of the Congress include Li Zhaoxing, who was removed as foreign minister in April, and Chen Liangyu, sacked last year as Shanghai party chief for graft.