Rail minister may have taken US$ 100 million+ in bribes

By Chris Sleight07 March 2011

Liu Zhijun was secretary general of China's Minsitry of Railways from 2003 until being removed from

Liu Zhijun was secretary general of China's Minsitry of Railways from 2003 until being removed from the post in February 2011 on suspicion of taking kickbacks.

Allegations have been levelled in the investigation into bribery and kickbacks in the Chinese railway construction sector that former minister Liu Zhijun may have taken more than CNY 800 million (US$ 122 million) in illegal payments.

Mr Liu has been in charge of China's railway network since 2003 in his capacity as secretary general at the Ministry of Railways. However, he was suspended in late February pending an investigation for alleged "severe violation of discipline." Sheng Guangzu was drafted in from the head of China's customs authority to replace him.

Mr Liu is the latest in a series of high-profile Chinese ministers that have been stripped of their posts and prosecuted for accepting bribes and kickbacks. In another construction-related incident, Kang Rixin, the head of China's civilian and military nuclear programmes was arrested in August 2009 for embezzling some US$ 265 million as well as interfering with bids for nuclear power plant construction schemes.

Mr Liu is thought to have demanded as much as 4% of contract values for the award of work on China's rapidly expanding high-speed rail network. Construction of the network was one of the key aims of China's stimulus plan, and the country has set a target of building 16000 km of such track by 2015.

Some sources have reported that the investigation is also looking at deputy general engineer at the Ministry of Railways, Zhang Shuguang, another key figure in China's high-speed railway construction programme. It has been reported in some quarters that he could have embezzled several billion Dollars in bribes and kickbacks.

The investigation is currently being handled by the Chinese Communist Party's internal disciplinary arm. If it finds enough evidence, the party will hand the case over to the courts for a full criminal trial. Soliciting or accepting bribes in China can be punished by the death penalty in China.

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