High-speed corruption

A massive corruption scandal has engulfed China’s Ministry of Railways, the publicity shy engine behind the country’s much heralded high-speed railroad network expansion in the past few years.

Caixin magazine described how authorities are investigating “a deeply-entrenched network of fraud including equipment suppliers and subsidiary officials,” involving many millions of dollars in bribes and kickbacks. Already, the corruption investigation has felled the Railways Minister Liu Zhijun, who was ousted last month. Now state-run media reports Zhang Shuguang, deputy chief engineer – the high-speed rail guru of the ministry – had been removed as part of the corruption probe.

China is in the midst of doubling its rail network, in a construction drive sparked by economic stimulus following the global financial crisis. Its rail expansion and emergence as the world leader in high-speed rail has drawn praise and potential contracts from around the world, but the scandal could cast doubt on the system’s credibility.