The ‘Panama Papers’ Fallout In China

April 5, 2016, 7:59 AM UTC

The cache of leaked documents exposing offshore tax schemes known as the Panama Papers isn’t the bombshell in China that it is elsewhere.

That’s partly because authorities are heavily censoring the news—stripping out any implication of Chinese officials hiding money offshore today and mostly removing any mentions of the leak.

But also because the most salacious accounts of officials wealth have been revealed. First it was then-president-to-be Xi Jinping’s relatives business holdings worth hundreds of millions of dollars, reported by Bloomberg in 2012. Then the New York Times reported on Premier Wen Jiabao’s relatives’ wealth. Two years later the International Consortium of Investigative Journalists, which helped shepherd the latest leak, focused on the offshore holdings of Chinese leaders and businesspeople.

The hidden wealth associated with Chinese leaders and their families has been a known to outsiders for years, but Chinese leaders are adept at hiding the news from their citizens.

In keeping with the trend, over the past day Chinese censors have quickly deleted mentions of the Panama Papers and sent directives to news sites and newspapers warning them against coverage. “If material from foreign media attacking China is found on any website, it will be dealt with severely,” censors warned. Stories shared on Tencent’s WeChat social network, for instance, displayed an error message saying they couldn’t be found.

A state-run paper, the Global Times, did mention the leaks today in criticizing the Western press, which it said was using the news to sully Western opponents such as Russian President Vladimir Putin, whose associates were said to have laundered a suspected $2 billion through offshore accounts. The Global Times’ editorial did not mention the Chinese leaders whose relatives were included in the leaks.

The one advance the leaks could make in China concerns the Communist Party’s powerful seven-person Standing Committee.

Relatives of two current members, Liu Yunshan and Zhang Gaoli, are named in the papers, according to the BBC, which was one of 107 news organizations analyzing the documents.

The news could give Xi’s political opponents within the Communist Party leverage to demand changes to his monopolization of power if evidence builds that his allies are involved in the same questionable behavior as those targeted in his three-year anti-corruption campaign.

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