China princeling emerges from defection scandal

WUHAN, China Tue Jun 19, 2007 7:20pm EDT

WUHAN, China (Reuters) - With an impeccable Communist pedigree, Yu Zhengsheng was a rising star in the mid-1980s until his brother, a senior Chinese intelligence official, defected to the United States.

His wings clipped by the scandal, Yu spent years biding his time in ministerial-level posts. Now, two decades later, he has emerged as a candidate to join the all-powerful Politburo Standing Committee at a Party congress slated for the autumn, sources with ties to the leadership said.

The resurgence of Yu, currently Party boss in the central province of Hubei, shows that even in modern-day, market-driven China, political staying power can depend largely on old-fashioned Party connections. His close ties are with the family of late paramount leader Deng Xiaoping.

"I wouldn't be surprised if Yu Zhengsheng enters the Politburo Standing Committee ... He's very competent," one source told Reuters, requesting anonymity.

Yu, 62, is also likely to be promoted to vice premier next March at the annual session of parliament, the sources said. Details of a reshuffle of the top ranks of both Party and government were expected to be hammered out at an informal leadership meeting in late summer.

In a country where people were commonly purged for the faults of relatives during the chaotic 1966-76 Cultural Revolution, the 1985 defection of Yu Qiangsheng could easily have scuttled his brother's political career.

TOP SPY BUSTED

The defector exposed a retired analyst for the Central Intelligence Agency, Larry Wu-tai Chin, who committed suicide in his cell in Virginia in 1986, days before a U.S. court was to sentence him for spying for China for about 30 years.

Thanks to his close ties to Deng Pufang, the wheelchair-bound eldest son of Deng Xiaoping, Yu Zhengsheng was spared the full political repercussions but fell off the fast track.

"Yu Zhengsheng had very close personal relations with Deng Pufang," said Ho Pin, New York-based co-author of a book on "Princelings" -- the sons and daughters of China's incumbent, retired or late leaders.

Deng Pufang was embroiled in a financial scandal in the late 1980s when Kang Hua, the trading empire he founded, was accused of abusing tax exemption privileges granted it for its donations to his welfare fund for the disabled.

Troubleshooting for the younger Deng, Yu closed down Kang Hua as part of an anti-corruption drive ordered by Deng Xiaoping while avoiding wider political damage.

"Yu Zhengsheng is the Deng family's representative in politics," a businesswoman with ties to the Deng family said.

After his brother's defection, Yu spent 12 years in the eastern coastal province of Shandong. Serving successively as vice mayor, mayor and then Party boss of Qingdao city from 1989 to 1997, he helped make Tsingtao beer and Haier household appliances China's best-known brands abroad.

POLITBURO

After a stint as construction minister in Beijing, Yu became Hubei party boss and made it to the Party's 24-member decision-making Politburo in 2002.

As top official in Hubei, Yu departed from tradition by plucking auto executive Miao Wei from political obscurity in 2005 to make him Party boss in the provincial capital, Wuhan.

With Yu's backing, Miao consolidated Hubei's auto industry, putting a stop to cut-throat competition between large and small carmakers. He also made sure Hubei automakers bought components from local state-owned enterprises instead of importing them.

Dispensing with the top official's usual panoply of police escorts, bodyguards and aides, Yu often ventures into the countryside to check out the work of local officials.

"The people are full of praise for him ... There has been construction everywhere since he came to Hubei," a local businessmen named Xiong said of him.

Under Yu's watch, Hubei's GDP now ranks 12th among the country's 31 provinces. Per capita income of farmers rose 10.3 percent to more than 3,400 yuan ($450) in 2006.

BLUE BLOOD

Born into a prominent family in Shaoxing, in the eastern coastal province of Zhejiang, and trained as a missile engineer, Yu is a political blue blood.

His father Yu Qiwei, a Communist underground militant who changed his name to Huang Jing to avoid arrest by Kuomintang troops, was a former husband of Jiang Qing, who went on to marry Party Chairman Mao Zedong.

Later, after the 1949 Communist takeover, Huang was to become the first Party boss of the northern port city of Tianjin.

For Yao Lifa, an activist known nationally for his dogged advocacy of elections free of Communist Party control, Yu is a princeling who will not compromise the Party's interests.

Yu visited Yao's home city late last year and "instructed the city government that independent candidates should not be elected to the local people's congress", the activist said.