Xi who must be obeyed
China’s Purge Hits Hong Kong

Xi Jinping’s purges—thinning the Party ranks of those less loyal under the guise of an anti-corruption drive—have been roiling China for a few years now. Just when the purges seemed to be slowing down, however, the mysterious abduction of a billionaire in Hong Kong has renewed fears about Xi’s intentions.

In the Financial TimesBen Bland explores the repercussions of the curious case of Xiao Jianhua:

Mr Xiao was abducted from the Four Seasons hotel in central Hong Kong in the early hours of January 27 by a group of Chinese public security agents, according to people briefed on the incident. At a time when he should have been preparing to celebrate Chinese new year with his family, he was instead whisked across the border into mainland China.

His disappearance has compounded fears about Beijing’s meddling in Hong Kong, which is supposed to have an autonomous government and an independent legal system. Coming after the abduction of Hong Kong book publisher Lee Bo and four of his colleagues in 2015, Mr Xiao’s seizure underlines the impotence of the Hong Kong government in the face of Beijing’s arbitrary power, says Kenneth Leung, an opposition member of the territory’s legislative council.

It also sends a strong warning to other wealthy businessmen about the determination of Xi Jinping, China’s president, to show no quarter to those with questionable dealings or connections to his political rivals.

Xiao’s abduction appears to be tied up in the struggle between Xi Jinping and the Shanghai faction of former president Jiang Zemin. Many of Jiang’s loyalists have been targeted in Xi’s crackdown on graft, and Xiao is known to have extensive business dealings with Jiang’s circle.

But there is more to the story than a factional struggle among Chinese elites. The involvement of Chinese security agents in forcibly removing Xiao from Hong Kong has shown once again that Xi has few qualms about assertively intervening in the city’s affairs. In recent months, the “One Country, Two Systems” framework granting Hong Kong significant autonomy has frayed in the face of extensive meddling from the mainland. Xiao’s abduction, following on the heels of Beijing’s intervention in a legal dispute that barred pro-independence activists from joining Hong Kong’s parliament, has furthered the appearance that Hong Kong’s provisional autonomy is only illusory and always subject to Beijing’s whims.

Xiao’s disappearance has also spooked the markets. As the Wall Street Journal notes, the stock market in Shanghai has taken a serious hit after seeing one of China’s major financial figures targeted by the government. Xiao is hardly the first Chinese financier to be found in Xi’s crosshairs, but many observers had previously considered him safe since he did business with many different political factions and was not exclusively tied to Jiang.

There is still much that is murky about Xiao’s case; there has been some speculation that he is being squeezed by authorities in Beijing for dirt on Xi’s rivals, and may re-surface once he’s been properly used up. In any case, the news suggests that Xi is still acting boldly to consolidate his power ahead of the Party Congress later this year, and that his quest for control need not be confined to the mainland.

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