Tianjin warehouse blast probe points to graft

2015-08-20 08:19Global Times Editor: Li Yan

Company connections used to obtain safety permits

Owners of Ruihai International Logistics, including the son of a former local police chief, reportedly used their connections to bypass safety regulations and obtain operating licenses for a chemical warehouse in Tianjin that exploded last week, killing at least 114 people. [Special coverage]

In a lengthy interview with the Xinhua News Agency on Wednesday, Dong Shexuan, identified as one of the largest shareholders of Ruihai, admitted that he is the son of the late Tianjin port police chief, Dong Peijun, and used his connections to obtain licenses to operate the warehouse of hazardous chemicals.

In a rare, candid and swift response, Tianjin authorities also disclosed the information of all of the company's major shareholders at a press conference on Wednesday, saying that Dong, 33, who owns 45 percent of Ruihai's shares, is the son of the former police chief. They also said that the company, founded in 2012, only obtained the license to handle dangerous chemicals in June.

"I have connections with the police and the fire safety control department, while Yu is well connected to safety supervision, customs and environmental protection authorities," Dong said.

Dong and Yu Xuewei, former deputy chief of the State-owned SinoChem Group's Tianjin branch, are among the 10 senior executives of Ruihai who have been detained in connection with the blasts. Yu said he invited Dong to help him start the company in late 2012 because of Dong's family background and connections.

Both Yu and Dong chose to be shadow owners. Yu asked his wife's cousin, Li Liang, to hold his 55-percent share in Ruihai on his behalf. Dong asked his high school classmate, Shu Zheng, to hold his 45-percent share.

Dong said that he chose to be a sleeping partner to avoid a conflict of interest. "… my father's position in the public security bureau may affect public perception [about my involvement], especially when he was under investigation at that time," he said. His father died in 2014.

Ruihai received an operating license for a facility to house dangerous chemicals in June, said Zong Guoying, Communist Party of China's Tianjin Binhai district chief, at a press conference on Wednesday. Since the explosions on August 12, media and the public have questioned the company's ability to acquire a license in just a few years.

"No matter who they are and what connections they have, we will conduct a thorough investigation and will punish the culprits according to law," Tianjin Mayor Huang Xingguo said at the press conference.

Safety loopholes

Li Danyang, a public administration expert at Ji'nan University, believes that the incident exposes the loopholes in safety supervision.

"To ensure strict safety supervision is particularly crucial in the hazardous chemicals business because of its impact on public safety and far-reaching implications," Li told the Global Times.

Li's viewpoint was shared by Dong Keyong, a professor of the School of Public Administration and Policy at Renmin University of China.

"Transparency is important [in preventing similar incidents]. Specialized knowledge is required in the hazardous chemicals business, hence it is highly unlikely that the public will be aware of the risks involved, let alone knowing how to prevent such an accident," Dong told the Global Times.

Dong also admitted that the company replaced a safety evaluation firm after it refused to endorse the company's plan to run a hazardous chemicals business because it failed to comply with the proximity provision, which requires a distance of at least 1,000 meters between residential buildings and the warehouse.

"Yu told me not to worry and leave the matter to him. He replaced the safety evaluation firm and got the report," Dong said.

Another report on the project's environmental impact has not been made public, although it should have been, a local official said Wednesday.

Li said the incident will change the thrust of the country's ongoing anti-graft campaign.

"The corruption crackdown should not only target 'tigers,' but also corruption on a much lower level that affects the lives of ordinary people," Li said.

No nerve gas detected

Meantime, Huang said that chemical residue has been cleared within three kilometers from the blast zone.

Huang said over 40 types of chemicals remain on the site, including 1,300 tons of peroxide, 500 tons of flammable solids, and 700 tons of highly toxic chemicals such as cyanide. A total of 150 tons of sodium cyanide collected from the site have been removed, he said.

Local officials also denied rumors that tests found nerve gas on the site.

The disaster affected more than 170 companies and 30,000 people. "As chief of Tianjin's Party commission and municipal government, I cannot shirk responsibility," Huang said.


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