Just after 1 a.m. on Jan. 27, 2017, they came for Xiao Jianhua. A group of plainclothes agents working for the Chinese government entered the Canadian billionaire’s luxury apartment overlooking Hong Kong’s Victoria Harbour. Two hours later, they re-emerged from the building, pushing Mr. Xiao in a wheelchair to a waiting vehicle.
By late afternoon, as most of Hong Kong was clocking off early to begin the Chinese New Year holiday, Mr. Xiao had been taken into mainland China. He has remained there ever since, with China blocking efforts by Canadian officials to meet with him and the federal government powerless to free him.
The apparent kidnapping of a foreign citizen – Mr. Xiao was born in China but held both Canadian and Antiguan passports – provoked immediate outrage and renewed concerns about Beijing’s encroachment on Hong Kong’s autonomy. Today, little of that autonomy is left, and a national-security law imposed in 2020 allows for people to be taken to the mainland for trial and for state security agents to operate in the city with no local oversight.
But while the circumstances of Mr. Xiao’s disappearance are no longer exceptional, the facts of the case remain striking: Five years after he was taken into custody, the financier has yet to appear in court, despite occasional reports that a trial was imminent.
Observers say this is because Mr. Xiao – widely believed to be a “white glove,” a bagman, for members of China’s elite, enabling them to do business deals under the radar – remains both too useful and too dangerous to Chinese President Xi Jinping.
“Because he was so well connected to so many top families, all the secrets about the wealth of those families are now in Xi’s hands,” said Feng Chongyi, an expert on Chinese politics at the University of Technology Sydney. “But Xiao also knows the secrets of Xi’s family.”
Born in 1972 to a middle-class family, Mr. Xiao was a child prodigy, attending Peking University on a law scholarship at 15. There, he met his future wife, Zhou Hongwen, and got involved in student politics. He was president of the student union in 1989, when thousands of young people took to Tiananmen Square to protest the government.
Mr. Xiao did not join them, instead working with university administrators to try to defuse the protests. After this failed, and the situation became increasingly heated in late spring, he retreated to the library, where he buried himself in his studies.
Unlike other student leaders, who were arrested or went into exile, Mr. Xiao emerged from the June 4 crackdown unscathed – but not unaffected. He abandoned his plans to go into politics, choosing instead to focus on business and becoming a devotee of Warren Buffett. But while he would later credit the “Oracle of Omaha” as his guiding light, Mr. Xiao – worth an estimated US$6-billion by the time of his disappearance – avoided having a high-profile persona for as long as possible.
“He made a good effort to keep many things secret,” Zhou Chunsheng, who tutored Mr. Xiao in math while he was a student at Peking University, told The Globe and Mail in 2017. Prof. Zhou described him as a “very smart guy [with] very good connections with many powerful people.”
Beginning in the late 2000s, Mr. Xiao reportedly acted as a white glove for elite families, including relatives of former top officials Zeng Qinghong and Jia Qinglin and of Mr. Xi himself.
Willy Lam, a China expert at the Jamestown Foundation, said such intermediaries are necessary “because if the leaders or ex-leaders were to get involved in, for example, buying stocks and shares or other kinds of business, they would look bad” and could even find themselves detained on corruption charges.
In January, 2013, Mr. Xiao helped Mr. Xi’s sister and brother-in-law offload a US$2.4-million investment. The couple, who had amassed a fortune estimated to be worth hundreds of millions of dollars in the decade before Mr. Xi came to power, were reportedly ordered to wrap up their business operations as the new President ramped up a massive anti-corruption crackdown.
Despite his powerful connections, the campaign appears to have rattled Mr. Xiao, who began increasingly operating outside China. He and his wife both acquired Canadian citizenship (Ms. Zhou still lives in Canada), and he moved his business operations to Hong Kong. He also became an ambassador-at-large for Antigua and Barbuda in 2015, advising the Caribbean country on trade issues.
These efforts to protect himself from Mr. Xi’s growing reach came to naught, however. After he was abducted, Mr. Xiao was taken to Shanghai, where the authorities have gradually dismantled his former empire, selling off assets and nationalizing companies linked to the financier. While there have been occasional reports of a trial on the horizon, Mr. Xiao remains under apparently indefinite house arrest.
Despite being both a Hong Kong resident and a Canadian citizen, neither government has been able to do much on Mr. Xiao’s behalf. Hong Kong police told The Globe an investigation was “still ongoing,” but according to local media, any probe has been stymied by their mainland counterparts.
Canada has proven equally powerless. “The Chinese government has stonewalled all requests for consular access,” said Guy Saint-Jacques, a former Canadian ambassador to China.
He said it remained unclear whether Mr. Xiao entered China on his Canadian passport – he also held Antiguan diplomatic papers – which would entitle him to consular protection under international law. Hong Kong authorities did not respond to a request for comment on this matter. Antigua and Barbuda’s Foreign Affairs Ministry also would not comment.
In response to an access to information request, Global Affairs Canada released 223 pages of e-mail traffic between officials regarding Mr. Xiao’s disappearance. The heavily redacted documents contained little information, however, with the majority consisting of responses to journalists over the years.
“Canada has and continues to raise the case with Chinese authorities and is closely monitoring this matter,” Global Affairs said. “To protect the privacy of the individual concerned, further details on this case cannot be released.”
Mr. Saint-Jacques said the case shows “how China can disregard its [international] obligations when it wants something or someone.
“What is also interesting in his case is that he has not been charged yet with any crime,” he added. “Xi has used him to go after people associated with other factions inside the CCP under the guise of the anti-corruption campaign. Because Xiao knows so much, I don’t think Xi will want to let him go.”
Mr. Xiao’s abduction came amid the run-up to the Communist Party’s 19th National Congress, at which Mr. Xi removed term limits on the presidency, clearing the way for him to rule for life. The 20th National Congress is due to be held later this year, at which point Mr. Xi is expected to begin an unprecedented third term as leader.
“If Xi controls your secrets, then you have to co-operate with him becoming a red emperor,” said Dr. Feng, adding that, after the key party meeting, “when things settle and Xi is secure on his throne, maybe Xiao can be released.”
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