Cracks in a great wall of silence

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 media.

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 suspicious cash 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 Chinese media.

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 analyst.

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.

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Author: Wu Zhong, China Editor
Original Source: Asia Times
Date Published: Nov 19, 2008
Web Source: http://www.atimes.com/atimes/China/JK19Ad01.html
Date Accessed Online: 2008-11-24