Why Yan Xie has to go!
You must first enable the government to control the governed; and in the next place, oblige it to control itself.― James Madison, The Federalist Papers
THE relationship between the government and the people can be as simple as Madison, one of the founders of the United States Constitution, put it in the Federalist Papers. The principle is simple; the people give the government control over themselves and the government learns to control itself.
It is not about the legal constraints that may or may not exist. It is about knowing what is right and what is wrong. The relations between the government and the people in the final analysis are regulated by moral ethical issues and self-regulation. Let no one say, “I can do it.” It is about whether it should be done and whether it is the right thing to do.
The June 2017 elections in Lesotho removed a government which had outlived its usefulness as a result of lack of accountability and also rampant corruption. The expectations of those like me who voted were high and we do not want to go back to the trenches with the new government. But the new government must, at the same time, show that it respects the people. It is not enough to say that the people have conferred power to the government; such a government in Madison’s terms is obliged to control itself. Let us not hear any of the government surrogates uttering the usual mumbo jumbo that it is the prerogative of the minister or the prime minister to do certain things. We have to see the difference between what we rejected and what we voted for. Prerogatives are not a licence to do whatever one wants. They are expected to be exercised with diligence.
Let us also not hear the surrogates telling us about the honeymoon period! Only human beings deserve such. Institutions need no respite from public pressure and are not entitled to a honeymoon. The people gave the government power to rule, but not to disrespect them. The announcement by the Acting Government Secretary to the effect that “….the Office of the Right Honourable the Prime Minister has appointed Mr Yan Xie as the Lesotho Head of Special Projects and Prime Minister’s Special Envoy and Trade Advisor on China-Asia Trade Network” brought a chill down my spine. At first, I thought it was fake news, but soon realised that it was not. Our government had acted in a manner that brings shame to us as citizens.
In every country there are places and institutions in government which are restricted or protected from everyday interactions and people. The office of the Prime Minister is one such place. In all the countries of the world, offices like those are sensitive and places of pride. Those are places where it would not be acceptable to find foreign nationals, heading strategic organs. I already hear, the usual mumbo jumbo that Mr Xie is a naturalised Mosotho. I have lived through all post-colonial governments in Lesotho and have witnessed with horror how those naturalisations or outright sale of Lesotho passports have taken place. This is how, a large number of countries which used to allow visa free travel for Lesotho citizens withdrew those privileges. I am not impressed. Mr Xie may have been naturalised, but it is well-known that he is not clean.
I will therefore not waste my time trying to find out whether he got Lesotho citizenship legitimately or otherwise. Those who have the time and energy may follow events in Australia before they howl, oh he is a citizen. I’m reminded that in South Africa close by we have some corruptors who have also acquired South African citizenship under opaque circumstances. We are now witnessing a clamour for a judicial inquiry into whether they have captured the state. Issues about citizenship and loyalty to the state are too complex to be discussed in a flippant manner that government surrogates would like us to do. In some countries, issues of nationality and citizenship are taken so seriously that there are stipulations on what a naturalised citizen can and cannot do. The Australian cabinet crisis shows the sensitive nature of citizenship.
More importantly, and as already alluded to above, Mr Xie is a well-known personality in Lesotho. His business empire is in retail, construction, and pharmaceutical and the meat industry. Except in retail and construction, his businesses are takeovers under opaque circumstances of government businesses. But also significant thing is that he tends to hide his real ownership of most of those businesses, claiming that he finances them but does not own them. Fortunately, the Lesotho Revenue Authority (LRA) has not bought into his claims. The question therefore is who exactly is Mr Xie? We have to explore whether Mr Xie has the necessary credibility to head a unit in the Prime Minister’s Office, let alone be a “..Prime Minister’s Special envoy…”
Yan Xie’s world
Yan Mr Xie has been in business in Lesotho for a long time now. He is generally regarded as the leader of what has come to be called the Shanghai group of Chinese in Lesotho who run all types of businesses from cafes to construction. They generally are under his wing. Mr Xie represents them and often collects donations from them for distribution when the need arises. Mr Xie knows and sponsors most politicians who matter in Lesotho. It was well known that since 2006, his Jackpot Supermarket was a shop of choice for several ministers, who did not have to pay for their routine grocery requirements. In return, Mr Xie is well looked after with government tenders and acquisition of government businesses whenever they go for sale. It is through his connections that he has been able to acquire the Lesotho Pharmaceutical Company in Mafeteng and Meraka Lesotho Abattoir among others. In all those acquisitions, Mr Xie charms his way to politicians whom he sponsors in any case.
Mr Xie acquired his citizenship on 22 December 2006 in terms of Certificate No: NAT.23/2006. There is no need for now to spell out the background to his naturalisation. But it is important to note that at that time up to the present, Mr Xie has brought under his wing politicians of all stripes and used his Jackpot Supermarket before it was reconstituted, as a cash cow for several ministers. In addition, he has dished out money and other favours to a long list of politicians including funding their election campaigns. Being a benefactor of the powerful, Mr Xie had become untouchable until LRA summoned the courage to investigate him culminating in his 2011 debacle where several of his businesses were raided and closed for some time for suspicion of fraud.
In reports at the time, the LRA suspected that Mr Xie had been understating tax obligations for Jackpot Supermarket, his other retail shops and the two construction companies. He was also suspected of making false customs declarations for goods that his businesses imported from South Africa. Overall, LRA suspected that he owed over M20 million in taxes for submitting documents which understated his income; he also understated his customs funds obligations, and generally did not run a clean business. With the assistance of the police, most of his known businesses were raided and closed. The benefactors of Mr Xie were up in arms, but LRA stood its ground.
Two things are important here:
a) All known businesses of Mr Xie were closed while LRA went on with its investigations. It is not known whether and how much Mr Xie settled his obligations since LRA does not disclose such issues about its clients unless there is a court order. But what is known is that Mr Xie liquidated his businesses and months later resumed business under new companies. The old companies which owed LRA no longer existed. As a result of the closure and the liquidation of those companies, a number of local companies which were owed money had no alternative but to write-off substantial amounts of moneys owed. One company whose records I have seen wrote off almost M500 000 of the debts Mr Xie’s company owed.
b) Mr Xie also runs a lot of companies as a silent or a hidden partner. For example, he ran a company called Jackpot Wholesalers which was under a different organisation as opposed to Jackpot Supermarket. He claimed then that he was not the owner but the financier of that wholesale. It was closed, but I have no confirmation that it was liquidated like the other companies. He has a string of such companies.
Mr Xie doesn’t seem to care about those businesses as long as they are a front and a means through which he stays in the front seat for government tenders. He is a ruthless tenderpreneur.
As a result of his connections, Mr Xie has acquired several government-linked businesses as already mentioned. But more significant, is that in most of the businesses he has acquired are run by some of the people who gave him the tenders without tendering. For now I will resist the temptation to mention them by name, but should the need arise, I am more than willing to expose the scams our new envoy is engaged in. He has also won a large number of government construction businesses from Metolong to closer home in Maseru. I now know that he is already circling around to be awarded a contract to complete a new State House without tender.
Whenever he is assured of winning a government tender without going through the normal process, he is willing to do so. But quite often he uses his surrogates to tender while he lobbies for them in government. As soon as they win the tender Mr Xie either takes over directly by buying them off or uses one of his well-known tricks of saying that he finances that business. This is exactly what happened recently in the scandalous police uniform tender whereby Mr Xie’s surrogates were awarded a tender illegitimately and then he won the trophy by buying out the main shareholder and director of the company. Without doing anything but use his influence he had a M7 000 000 police uniform tender. The matter is still running its course in the lethargic Lesotho courts but by the time judgement is issued, Mr Xie’s time as a supplier of police uniforms will probably have expired. He will have fulfilled the terms of the contract and those who challenged will probably win a Pyrrhic victory. If they ultimately win several years down the line, the best they can get is to sue for compensation.
An interesting thing here is that Mr Xie is an ever smiling character but he has around him a former police officer who does his other dirty work. People know that this is the guy who navigates Mr Xie from falling in the hands of the law enforcement officers. If in Lesotho, we can have a person charged for delaying to register with the tax authorities, but it only remains with LRA to wrestle him and no charges follow you should know that something is wrong. Both his connections and the connections of his police friend matter!
The question therefore is whether Mr Xie is fit for office? Is he a fit and proper person to be appointed to such an important position?
Why Yan Xie must go!
Anybody who understands global developments knows that China is an evolving economic superpower. Over and above the setting up of BRICS funding mechanisms, China has established and committed billions of dollars in development finance for Africa over the past decade as Beijing seeks to secure its political and economic clout on the continent. Any country in the world, developed or developing is scrambling to have a share in development finance and trade with this emerging giant. Dealing with this giant requires an active engagement and also sensible strategies lest one chases a passing chimera. This is why most countries have established specific Councils which are able to strategise on how to take advantage of the potential development and trade bonanza. It is not just about grabbing anybody who is from China and assigning him to head special projects and become an envoy.
More critically, it is about identifying knowledgeable and credible people who could advance our interests as a country. I fear that the global business community will see us as a captured state with a corruptor as our envoy.
Let us just consider what he has done with “these gifts” of the businesses he has acquired as a first step. None of those businesses have prospered. He, for all intents and purposes runs a medium size supermarket and those businesses he has been gifted by successive regimes in Lesotho. The rest of his empire is dependent on government tenders.
In most countries, for people to be eligible to key positions, they require that an ethics test be passed. This is a test which attempts to find out whether the person is a fit and proper one to be entrusted with key responsibilities. Unfortunately in Lesotho, our system does not require people to be evaluated on their ethically propriety. Indeed, if Mr Xie was evaluated, on the basis of his business dealings alone, he would have been barred from assuming any public office. He has sponsored key people in the old regime and he sponsors others in the present regime. For now, I will not release the nature and extent of the sponsorship, but am horrified how people are indebted to him.
This is why I call upon the government to release Mr Xie from his appointment in order not to continue to embarrass us. We have gone through too much to be settled with a corruptor. To both the old regime and the present one, I wish them silence. The old regime doesn’t have to do anything but keep quiet about Mr Xie. For the new regime, we only require them to release Mr Xie from his post. I don’t think it will be good for anybody if we were to engage in a damaging debate about the extent of Mr Xie’s control over them. This government needs to be protected from itself. The opposition is too weak to pose any danger to this government, but the recklessness of this government on this matter will ensure that it does not last five years. Let me repeat Mr Xie’s sponsorship of key politicians in Lesotho is extensive and those who want to challenge me on this are advised to sit back and relax lest all is revealed. Mr Xie must go!
- This article was originally published on Prof Sejanamane’s blog lesothoanalysis.com His views do not necessarily reflect the views of the Lesotho Times.