How Hong Kong officials get into dirty geopolitical games
The arrest of Patrick Ho Chi-ping, former secretary for home affairs, could be related to the rivalry between the United States and China
The number of former Hong Kong officials facing charges of bribery continues to mount, as do signs that, 20 years after the handover from British to Chinese rule, the mainland’s culture of corruption has also been handed over to a city once admired as a bastion of the rule of law.
This time it is former secretary for home affairs Patrick Ho Chi-ping who has been accused, and the allegations go far beyond the cramped confines of little Hong Kong to ensnare one of China’s top energy companies, CEFC China Energy, an African president allegedly willing to sell the oil rights in his country for a US$2 million inducement, a United Nations diplomat from a second African country eager to set up dubious joint ventures in his nation in exchange for US$500,000 and a former foreign minister from a third African state who served as Ho’s go-between in this transcontinental kickback scheme.
Furthering the intrigue, Ho’s arrest this month in New York City on charges of international money laundering and violations of the Foreign Corrupt Practices Act could also be related to the alarm felt in the administration of US President Donald Trump over China’s increasing exploitation of African energy resources to advance Beijing’s ambitious Belt and Road Initiative. That’s Chinese President Xi Jinping’s grand blueprint to turn his country into a global superpower in the coming decades.
Finally, in a year in which US politics have been dominated by allegations of Russian interference in the 2016 presidential election, there may be a Russian subplot to this story as well. It turns out that Ho’s arrest occurred just days after CEFC and the Russian state-owned oil giant Rosneft struck a big oil-supply agreement that no doubt raised eyebrows (and perhaps even agitated voices calling for some sort of counterstrike) in Washington.
CEFC – a little-known company until the past few years – has rapidly grown into a conglomerate that, according to reports, earned revenue of nearly US$40 billion in 2015 and figures to play a major role in China’s voracious quest for energy resources. Moreover, CEFC now owns a 14% stake worth US$9 billion in Rosneft, currently a subject of US sanctions against Russia.
Back in Hong Kong, Ho’s arrest was greeted with little more than a shrug. After all, over the past few years the city has seen a former chief secretary, Rafael Hui Si-yan, jailed for accepting HK$11.182 million (US$1.4 million) in bribes from property developers and a former chief executive, Donald Tsang Yam-kuen, jailed for misconduct in office while narrowly escaping another, longer prison sentence on a bribery charge thanks to the indecision of two consecutive hung juries.
Yet another former chief executive, Leung Chun-ying, whose term expired just last June, is currently under investigation by Hong Kong’s Independent Commission Against Corruption as well as a Legislative Council (Legco) select committee for his failure to disclose the HK$50 million payment he received in two installments from Australian engineering firm UGL prior to and during his five-year term as CE.
Ho’s global wheeling and dealing on behalf of China’s largest private oil and energy enterprise only adds to a growing sense of unease and foreboding felt by those who worry about the future of Hong Kong
So the portly 68-year-old Ho’s global wheeling and dealing on behalf of China’s largest private oil and energy enterprise only adds to a growing sense of unease and foreboding felt by those who worry about the future of Hong Kong, still celebrated as one of Asia’s least corrupt cities, as a special administrative region of China.
Increasingly, mainland companies, mainland politics and mainland culture are transforming Hong Kong. The Hong Kong government, which has used the courts to jail democracy advocates and oust directly elected pan-democratic lawmakers from Legco, has become little more than a puppet regime whose strings are pulled in Beijing.
At the same time, mainland firms now dominate the city’s IPO (initial public offering) market while Chinese property giants such as HNA Group and Logan Property Holdings consistently outbid local property tycoons for ever more expensive land for development.
Patriotic education is being pushed on Hong Kong schoolchildren, and there is renewed talk of tough new anti-subversion legislation that would stifle dissent in a city whose handover mini-constitution, known as the Basic Law, guarantees freedom of speech and freedom of the press.
Amid this sour atmosphere comes news that another post-handover Hong Kong official has been tainted by allegations of corruption – this time on the international stage.
If the charges against Ho – an ophthalmologist by profession who left office as secretary of home affairs in 2007 – hold up, he will be spending the next 20 years of his life behind bars.
According to a criminal complaint filed by the US Justice Department in a New York City federal court, Ho, acting as secretary general of a Hong Kong-based non-governmental organization funded by CEFC, channeled US$2 million to Chadian President Idriss Déby in return for granting oil rights in his nation to CEFC.
Ho allegedly paid another US$400,000 to former Senegalese foreign minister Cheikh Gadio for his assistance in his bribery schemes, which included another payment of US$500,000 to Uganda’s foreign minister, Sam Kutesa, in exchange for the promise of sweetheart Ugandan business contracts for CEFC that included building an energy industrial park, developing a high-speed railway, acquiring a bank and more.
Gadio, 61, now the head of an international consulting firm, was also arrested this month in New York on the same charges leveled against Ho.
US prosecutors claim that the Kutesa payment was funneled to the re-election campaign of Ugandan President Yoweri Museveni, Kutesa’s brother-in-law and the country’s leader since 1986, and that the arrangement was made in the halls of the New York headquarters of the United Nations during Kutesa’s 2014-15 term as president of the UN General Assembly.
All parties charged or implicated in the case have, of course, denied that anything untoward took place. The fact is, however, that this sort of quid-pro-quo collusion is common business practice for Chinese firms operating in Africa and elsewhere and that this would hardly be the first corrupt bargain ever struck in the hallowed corridors of the UN.
Indeed, Ho and Gadio could be forgiven for feeling that they are victims of selective prosecution in a much bigger geopolitical game aimed at blocking China’s rise to superpower status and influence.
One thing is for sure: Hong Kong officials, former and present, are jumping into that dirty game.