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Sunday 23 November 2008
China’s Stimulus Package: Inspection Goes along with Investment to Prevent Corruption
With the announcement of the central government’s 4 trillion yuan investment plan, 24 inspection and supervision teams have been dispatched to conduct project oversight in order to prevent waste and corruption.
China’s Stimulus Package: Inspection Goes along with Investment to Prevent Corruption
22 November 2008
With the announcement of the central government’s 4 trillion yuan investment plan, 24 inspection and supervision teams have been dispatched to conduct project oversight in order to prevent waste and corruption.
Whenever large-scale investment takes place, a tendency towards corruption is inevitable, a tradition not least in East Asian countries. After the 1997 Asian financial crisis, China invested massively in highways to stimulate the economy, and provincial officials in department of transport from 17 provinces were prosecuted because of corruption.
At present, it is difficult for China’s large projects to undergo a fair bid and contract process. Recently a cave-in at a subway project in Hangzhou killed at least 10 people with 13 missing. The subway project was subcontracted and conducted by untrained workers.
People worry that if 4 trillion yuan worth of projects are launched in haste, it will bring about such disasters on a string.
Among the announced investment projects, a number of large water conservancy and subway projects are included, some of which have been waiting a long time, perhaps with good reason, for approval.
And corruption is only one of the possible problems. It is reported that Beijing hotels near the National Development and Reform Commission (NDRC) offices are overflowing with officials from local governments, vying for a piece or two of the gigantic rescue package pie. NDRC is the most influential department among all Chinese economic departments, as all big and many “pet” development projects need its approval. The total amount of engineering/financial expertise held by these mostly small district political leaders cannot be substantial.
He Guoqiang, who is in charge of supervision for a clean and honest administration and is a member of the Standing Committee of the Politburo, (an all-powerful 9-person group of China’s highest decision-makers), held a mobilization meeting November 21 on expanding domestic demand and conducting supervision and inspection work. He emphasized that discipline inspection departments must follow up on time and fully participate to ensure transparent and efficient management and use of the financial investment.
The Chinese Communist Party has set up a working group led by the Ministry of Supervision, made up of the National Development and Reform Commission, Ministry of Finance, and the Audit Commission. He Yong, deputy secretary of the Central Commission for Discipline Inspection of the CPC, is the group director. Ma Wen, deputy secretary of Central Commission for Discipline Inspection of the CPC and Minister of Supervision, and Liu Jiayi, deputy director of the Audit Commission, are deputy directors. At the same time, 24 inspection teams were set up and dispatched to 31 provinces and autonomous regions to carry out supervision and inspection work.
The central government announced two weeks ago an investment stimulus plan of 1.1 trillion yuan over two years, pulling in an investment from various other sources totaling of 4 trillion yuan. Local governments are also implementing their own measures, and investment plans totaling at least 10 trillion yuan have been announced.
The central government is sending 24 inspection teams to all provinces to ensure appropriate use of the massive economic stimulus funds newly endorsed by the State Council, state media reported yesterday.
The special taskforce will fan out across 31 provinces and regions, including restive areas of Tibet and Xinjiang , in a bid to pre-empt any malpractice in the use of 100 billion yuan (HK$113 billion) the central government has allocated for the fourth quarter, Xinhua reported.
The 100 billion yuan is the first instalment of Beijing’s massive stimulus package. On November 9, the State Council unveiled a 4 trillion yuan spending plan through 2010 to expand domestic demand amid the economic slowdown.
He Guoqiang , the Communist Party’s disciplinary chief, said at a meeting of the taskforce that the purpose of the large-scale inspection was to ensure a “safe, transparent, efficient” use of central funds, Xinhua reported.
The taskforce was a joint effort involving several ministries including the Ministry of Supervision, the National Development and Reform Commission, the Ministry of Finance and the National Audit Office.
The funds are intended for infrastructure, ecological construction and projects that can help enhance people’s livelihoods. Ensuring the funds were used for what they were intended for was the main goal of the taskforce, Mr. He said.
The inspection teams plan to monitor use of the funds, from the approval process through to the spending stage.
Emphasis would be given to preventing the funds from being invested in “high energy-consuming and high-polluting” projects, Xinhua said.
Also off-limits was the building of extravagant and luxurious government buildings, a common practice in recent years.
Officials found to have been involved in embezzlement, taking bribes and making blind investments in wasteful projects would be severely punished, it said.
All provincial governments, which have been scrambling to apply for the funds, will be strictly supervised by the special taskforce.
By sending out the inspection taskforce the central government is sending a clear message to the provinces with regard to the long and checkered history of infrastructure construction.
Government-invested construction, often using shoddy materials, has resulted in a number of fatal accidents. The latest was the collapse of a subway tunnel in Hangzhou last week, in which 21 labourers working underground died.
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China’s Stimulus Package: Inspection Goes along with Investment to Prevent Corruption
22 November 2008
With the announcement of the central government’s 4 trillion yuan investment plan, 24 inspection and supervision teams have been dispatched to conduct project oversight in order to prevent waste and corruption.
Whenever large-scale investment takes place, a tendency towards corruption is inevitable, a tradition not least in East Asian countries. After the 1997 Asian financial crisis, China invested massively in highways to stimulate the economy, and provincial officials in department of transport from 17 provinces were prosecuted because of corruption.
At present, it is difficult for China’s large projects to undergo a fair bid and contract process. Recently a cave-in at a subway project in Hangzhou killed at least 10 people with 13 missing. The subway project was subcontracted and conducted by untrained workers.
People worry that if 4 trillion yuan worth of projects are launched in haste, it will bring about such disasters on a string.
Among the announced investment projects, a number of large water conservancy and subway projects are included, some of which have been waiting a long time, perhaps with good reason, for approval.
And corruption is only one of the possible problems. It is reported that Beijing hotels near the National Development and Reform Commission (NDRC) offices are overflowing with officials from local governments, vying for a piece or two of the gigantic rescue package pie. NDRC is the most influential department among all Chinese economic departments, as all big and many “pet” development projects need its approval. The total amount of engineering/financial expertise held by these mostly small district political leaders cannot be substantial.
He Guoqiang, who is in charge of supervision for a clean and honest administration and is a member of the Standing Committee of the Politburo, (an all-powerful 9-person group of China’s highest decision-makers), held a mobilization meeting November 21 on expanding domestic demand and conducting supervision and inspection work. He emphasized that discipline inspection departments must follow up on time and fully participate to ensure transparent and efficient management and use of the financial investment.
The Chinese Communist Party has set up a working group led by the Ministry of Supervision, made up of the National Development and Reform Commission, Ministry of Finance, and the Audit Commission. He Yong, deputy secretary of the Central Commission for Discipline Inspection of the CPC, is the group director. Ma Wen, deputy secretary of Central Commission for Discipline Inspection of the CPC and Minister of Supervision, and Liu Jiayi, deputy director of the Audit Commission, are deputy directors. At the same time, 24 inspection teams were set up and dispatched to 31 provinces and autonomous regions to carry out supervision and inspection work.
The central government announced two weeks ago an investment stimulus plan of 1.1 trillion yuan over two years, pulling in an investment from various other sources totaling of 4 trillion yuan. Local governments are also implementing their own measures, and investment plans totaling at least 10 trillion yuan have been announced.
Teams to Check How Stimulus Funds are Used
He Huifeng
23 November 2008
The central government is sending 24 inspection teams to all provinces to ensure appropriate use of the massive economic stimulus funds newly endorsed by the State Council, state media reported yesterday.
The special taskforce will fan out across 31 provinces and regions, including restive areas of Tibet and Xinjiang , in a bid to pre-empt any malpractice in the use of 100 billion yuan (HK$113 billion) the central government has allocated for the fourth quarter, Xinhua reported.
The 100 billion yuan is the first instalment of Beijing’s massive stimulus package. On November 9, the State Council unveiled a 4 trillion yuan spending plan through 2010 to expand domestic demand amid the economic slowdown.
He Guoqiang , the Communist Party’s disciplinary chief, said at a meeting of the taskforce that the purpose of the large-scale inspection was to ensure a “safe, transparent, efficient” use of central funds, Xinhua reported.
The taskforce was a joint effort involving several ministries including the Ministry of Supervision, the National Development and Reform Commission, the Ministry of Finance and the National Audit Office.
The funds are intended for infrastructure, ecological construction and projects that can help enhance people’s livelihoods. Ensuring the funds were used for what they were intended for was the main goal of the taskforce, Mr. He said.
The inspection teams plan to monitor use of the funds, from the approval process through to the spending stage.
Emphasis would be given to preventing the funds from being invested in “high energy-consuming and high-polluting” projects, Xinhua said.
Also off-limits was the building of extravagant and luxurious government buildings, a common practice in recent years.
Officials found to have been involved in embezzlement, taking bribes and making blind investments in wasteful projects would be severely punished, it said.
All provincial governments, which have been scrambling to apply for the funds, will be strictly supervised by the special taskforce.
By sending out the inspection taskforce the central government is sending a clear message to the provinces with regard to the long and checkered history of infrastructure construction.
Government-invested construction, often using shoddy materials, has resulted in a number of fatal accidents. The latest was the collapse of a subway tunnel in Hangzhou last week, in which 21 labourers working underground died.
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