Intelligence agencies report on Chinese corruption in highest echelons of its government

NEWS AND ANALYSIS:

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U.S. intelligence agencies are working on a report expected to reveal extensive corruption and hidden wealth held by Chinese Communist Party leaders, including President Xi Jinping, who also holds the post of party general secretary. The report is required in law by a section of the fiscal 2023 National Defense Authorization Act signed by President Biden in December.

Angela Sohn, spokeswoman for the Office of the Director of National Intelligence, said work on the report is underway. The office “is aware of and working to fulfill this requirement,” she told Inside the Ring.

Section 6501 of the over 1,000-page act mandates that Avril Haines, the director of national intelligence, has a year from December to complete and make public the unclassified report, together with Secretary of State Antony Blinken, on “wealth and corrupt activities of the leadership of the Chinese Communist Party.”

Those targeted in the report include Mr. Xi and senior officials of the 98 million-member party. They include the 205-member Central Committee, the 25 most senior officials of the Chinese Communist Party in the Politburo, and the highest-ranking party organ, the seven-member Politburo Standing Committee, the collective leadership headed by Mr. Xi.

U.S. spy agencies will also assess and report on the regional party secretaries in 29 locations in China and whether they have any hidden wealth or links to corruption.

The report is likely to upset the Biden administration’s effort to stabilize relations with Beijing. As part of new detente and engagement policies, the administration has sought to limit criticism of Beijing under the rubric of “responsible competition” that officials say seeks to avoid future conflict.

Corruption is said to be widespread within the Chinese communist system. Mr. Xi himself has launched numerous political purges of suspected corrupt party and military officials.

The ODNI, in its annual threat assessment made public last month, said Chinese leaders are “almost certainly” dealing with “the ongoing impact of corruption on the military’s capabilities and reliability, judging from a purge of high-level officers, including the defense minister, in 2023.”

Corruption is among several problems facing Chinese leaders, the assessment stated: “Xi continues to regularly reprimand, publicly warn, investigate, and conduct firings based on the dangers of corruption.”

One of the most notorious examples of hidden wealth was the case of former Prime Minister Wen Jiabao, who amassed a $2.7 billion fortune by funneling money to family members. The case was exposed by The New York Times in 2012.

“Public anger over corruption terrifies Xi and the rest of the Chinese Communist Party’s leadership,” former diplomat and retired Marine Corps Col. Grant Newsham stated in his book, “When China Attacks.”

Mr. Newsham said he was skeptical of Mr. Xi’s yearslong anti-corruption campaign, one that appears more focused on sidelining potential rivals than ending illicit activities. The problem of corruption in China is too deep-seated within the communist system for Mr. Xi to root out, he argues.

The leak of more than 11 million legal and financial records from around the world in 2016, known as the Panama Papers scandal, also revealed evidence that leading Chinese government families used offshore companies to hide large amounts of money. In the early 2010s, both The New York Times and the Bloomberg news service were harassed for reporting Chinese leaders’ corruption, including vast overseas wealth reportedly maintained by Mr. Xi.

“The United States must expose ruling-class corruption, perhaps starting with the top 500 CCP leaders and their families, and trumpet it repeatedly and widely,” Mr. Newsham said. “That corruption is the juice that speeds along the [Belt and Road Initiative] and Chinese influence efforts in the Pacific, Africa, Latin America and elsewhere.”

The CIA Open Source Enterprise, which tracks publicly available material, has cataloged numerous cases of Chinese corruption. But its reports, once made available to the public, are now secret.

The legislation requiring the report was added to the annual Defense Authorization Act last year by the staff of Sen. Marco Rubio of Florida, the ranking Republican on the Senate Intelligence Committee. A Rubio spokeswoman did not immediately respond to a request for comment.

Paul Berkowitz, a China expert and former congressional aide, said the report could help explode the foundational myth of humble, self-sacrificing Chinese Communist Party leaders. The Rubio legislation will reveal their enormous individual wealth, somehow compiled while living on government salaries, he said.

“Author Edgar Snow breathlessly described in his book ‘Red Star Over China’ how Mao’s guerrilla army supposedly paid for the chickens they took from defenseless peasants,” Mr. Berkowitz said. “Those chickens are about to come home to roost.”

Taiwan to practice for Chinese drills turning into attacks

Taiwan’s military, facing extensive military coercion from the Chinese army over the past two years, plans to hold war games from April 19 through April 26 that simulate a Chinese military exercise-turned-attack, the island’s defense ministry said this week.

Tung Chih-hsing, a military officer in charge of the ministry’s joint combat planning department, told reporters on Wednesday in Taipei that the exercises will include practice on how military forces can quickly respond to a Chinese exercise around the island that suddenly becomes an actual attack.

Since August 2022, China’s warplanes and warships have routinely conducted extensive activities in the skies over Taiwan and in the waters surrounding the democratic-ruled island. The flights have included hundreds of aircraft, many that cross the median line that serves as an unofficial border between the two states and violate the fragile status quo that has kept the peace since the late 1970s.

China’s military activities require Taiwan’s military to respond, giving Chinese military analysts a chance to study Taipei’s defenses as part of pre-invasion or pre-blockade planning.

Mr. Tung said the annual exercises known as “Han Kuang” this year will include setting up kill zones at sea designed to break a Chinese blockade. The exercises also will simulate Chinese military drills that become attacks.

The computerized war games will be conducted using U.S.-built Joint Theater Level Simulation software, which will be used to assess and respond to what the military calls “gray zone” tactics — those below the level of direct conflict — and naval blockades and other possible Chinese invasion scenarios, Mr. Tung said. The war games will combine naval, air and coast guard forces, shore-mounted anti-ship weapons, and drones to set up a maritime “attack-and-kill chain,” he said.

“In addition, [we will] use naval and air forces and coast guard ships to jointly carry out escort operations” to make sure sea and air links from the island to the outside world remain open, Mr. Tung said.

The Chinese army held its largest exercises in decades around Taiwan following the August 2022 visit to Taiwan by then-House Speaker Nancy Pelosi. China has vowed to take over Taiwan in the coming years, either peacefully or through military action.

Chinese President Xi Jinping said on Wednesday in a meeting with former Taiwanese President Ma Ying-jeou that outside inference will not stop a planned “family reunion” between the mainland and Taiwan.

China claims Taiwan as its territory. The United States says it does not support “independence” for Taiwan but also has not recognized Chinese sovereignty over the island.

Chinese nationalist forces fled the mainland to Taiwan in 1949 when the communists took power, but now favor engagement and greater contacts with Beijing.

China sends high-level delegation to North Korea

Amid growing North Korea-Russia ties, China’s government this week dispatched a high-level delegation to Pyongyang in an apparent effort to woo the regime of Kim Jong Un back into its orbit, according to published reports in Beijing.

Zhao Leji, the No. 3 official in China, is leading a “goodwill visit” to North Korea, Pyongyang’s official Korean Central News Agency and China’s Foreign Ministry disclosed. Mr. Zhao is the highest-ranking official to visit North Korea since President Xi Jinping traveled there in June 2019.

At the Chinese Foreign Ministry, spokeswoman Mao Ning told reporters Tuesday that the visit “reflects the deep friendship between our two countries and the great importance China attaches to it.”

Chinese leaders in the past have described the relationship between the two communist regimes to be “as close as lips and teeth.”

North Korea’s ties with Russia have deepened in recent months as Pyongyang has been supplying Moscow with weapons and ammunition for use in the war on Ukraine. In exchange, North Korea has received large amounts of aid from Russia.

• Contact Bill Gertz on X @BillGertz.