SUN WUKONG Cracks in a great wall of silence
By Wu Zhong, China Editor
HONG KONG - Although China promised in October to indefinitely extend the
greater freedoms granted to foreign journalists' during the Olympic Games, its
domestic media remains under the tight scrutiny and control of the ruling
Chinese Communist Party (CCP). Yet one plucky business reporter has decided to
take a courageous one-woman stand against the party's monolithic control of the
The CCP's Bureau of Publication and Press in Inner Mongolia in September
ordered the China Business Post, a business weekly with circulation of around
400,000, to suspend publication for three months after it ran a report exposing
transfers at a public bank in Changde City, Hunan province.
The bank was a branch of the Agricultural Bank of China (ABC), one of the
country's "Big Four" state commercial lenders and the only one that has not yet
sold its shares to the public.
Unconvinced by the charges, Cui Fan, the journalist who wrote the report, filed
a lawsuit with a court in the Inner Mongolian capital of Hohhot against the CCP
press body, demanding a reversal of its decision and for it to make a symbolic
compensation payment for damaging her reputation.
Although an official at the Hohhot court has told the Associated Press that the
case will probably be rejected, Cui's challenge of the government through the
courts is still a major breakthrough, as she has garnered unprecedented public
support for her one-woman campaign, and the case is bound to awaken
journalists' awareness in safeguarding their own rights, analysts say.
Cui's lawsuit is the first against the government for interfering in the press,
and highlights the growing assertiveness by the media.
It is a common practice in China for the government to suspend a publication if
its reports offend a powerful organization such as a government department or a
big state-owned enterprise, and the publisher and/or editor of the publications
normally swallow the charges without complaint so as to maintain the survival
of the publication and their own career.
Cui's report in the July 11 issue of the China Business Post alleged that ABC's
Changde Branch twice transferred bad debts and non-performing loans (NPL) in
2003-04 and 2008 worth a total of nearly six billion yuan ($879 million)
without first seeking proper approval. Irregularities were also involved in the
process, such as selling the bad assets at remarkably cheap prices to the local
branch of China Great Wall Asset Management. Great Wall is one of four
institutions set up in 1999 to take on the bad loans of the large banks which
for decades had had to follow government directions to lend to unprofitable
companies and projects.
Cui's report came out at a sensitive time, when ABC, which has 24,000 outlets
and nearly half a million employees, was preparating to start a restructuring
into a joint-stock corporate firm. The other three of the "Big Four", the
Industrial and Commercial Bank of China, China Construction Bank and Bank of
China have already completed the restructuring and sold shares in the Shanghai
and Hong Kong markets.
The crux of ABC's restructuring is to get rid of it bad debts and NPLs so that,
with a capital injection from the Chinese government, it increases its capital
adequacy ratio while bringing down the NPL ratio. The ABC has to rid itself of
bad debts and NPLs worth at least 800 billion yuan, according to reports.
ABC saw the China Business Post's report as very unfavorable at this crucial
time in the build up to its sale of shares to the public. The bank plans to
complete preparations for an initial public share offering in the second half
of next year, according to Bloomberg.
Under China's press laws, if the ABC thought the report was not true, it could
lodge a protest with the newspaper demanding a clarification and an apology, or
file a lawsuit against it. But the state lender did neither, instead filing a
complaint with the Communist Party's propaganda authority, the big boss of
On September 25, China Business Post carried a notice on its website saying it
had been ordered by Inner Mongolia's Bureau of Publication and Press to suspend
publication for three months for violating rules such as, "a local medium must
not [expose scandals] on other localities"; "news coverage must comply with
proper application procedures"; and "sensitive news stories must be checked
with the concerned parties before publication". The bureau never clarified
whether the report was found to be true or false.
Cui filed her lawsuit at the end of October, claiming that while the state has
the legal authority to halt distribution of a particular issue of a paper, it
cannot suspend a paper from publishing for three months. She has demanded one
yuan in compensation and that her legal fees are paid.
Zhou Ze, Cui's lawyer and an associate professor at the China Youth University
for Political Sciences - the top training school of the Chinese Communist Youth
League - told the media last week that Cui's report was based on a thorough
investigation, and that by running the report the China Business Post was
fulfilling the duties of the fourth estate.
Furthermore, Zhou said the three charges on which the Inner Mongolian media
watchdog based its charges were completely "fabricated" as they were not found
in existing laws and regulations. "There is no such punishment for the media as
suspension of publication for reasons such as carrying false reports," Zhou was
quoted as saying.
Some Chinese analysts doubted that the Inner Mongolia court would accept the
case. "The ABC is a vice-ministerial-level government institution in the
country's administrative hierarchy. How would the Inner Mongolia court, which
is much lower in ranking, dare to handle a lawsuit against ABC?" a
Beijing-based analyst said.
But Cui's move is a still a breakthrough, as she managed to bring her case to
the public's attention. "So if she fails this time, with her taking the lead,
other journalists may follow in future to take similar cases to the court. The
party's propaganda authorities will have to become more cautious and careful
when handling out administrative punishments to the media," said the Beijing
The public have their own doubts about the ABC case. "If the ABC thinks the
report is totally false, why has it not dealt with it in accordance with the
law. Why did it appeal to the party's propaganda authority?" one blogger wrote.
"Is it like the old Chinese saying: 'The more one tries to hide, the more one
is exposed'," said another.
Because of her stand, the public will now keep a closer eye on ABC's upcoming
restructuring, so Cui's stand has helped China's media fulfill its supposed
role. It also highlights the small but growing cracks in the great wall China
has put up against a free press.