China Resources

China Resources is a company of the government of the People's Republic of China, founded in Hong Kong in 1938 as Liow & Co. In the 1990s it became the principal mainland partner of the Riady family's Lippo Group, bought 15 percent of the Lippo-owned Hong Kong Chinese Bank in 1992, and put tens of millions of dollars into Lippo Land. Congressional committees investigating the 1996 federal election campaigns examined its chairman's meetings in Washington arranged by the Lippo executive John Huang.¹²³

Liow & Co.

According to the company, its predecessor, Liow & Co., was established in Hong Kong in 1938 "to unite democrats resisting the Japanese aggression in Hong Kong and overseas, to collect, store and manage contributions and materials donated in support anti-Japanese war effort, and to procure military supplies and medicines for anti-Japanese bases," "under the leadership of the previous generation of proletarian revolutionaries," Zhou Enlai and Chen Yun, and was headed by Yang Lianan. During the war it worked with the China Defense League of Soong Ching-ling, carrying donated material to the anti-Japanese bases and buying military supplies and medicines for the Eighth Route Army and the New Fourth Army. In the civil war it ran the blockade to deliver supplies to the mainland, and in 1948 and 1949 it moved more than 350 democrats and more than 700 cultural figures and overseas Chinese from Hong Kong to the Northeast Liberated Areas for the first session of the Chinese People's Political Consultative Conference.¹

In 1948 Liow & Co. was restructured and renamed China Resources, the second character of the Chinese name being taken, according to the company, from the style name of Mao Zedong, and Qian Zhiguang became the first chairman of the board. From 1953 to 1982, the company's "General Trading Agency Phase," it organized in 1956 the first Chinese Export Commodities Fair, precursor of the Canton Fair; its subsidiary Ng Fung Hong ran the "triple express trains" carrying fresh and frozen food to Hong Kong from 1962; and in the early 1970s it helped carry mainland oil to Hong Kong. In 1983, with the completion of the China Resources Building in Hong Kong, it was restructured as China Resources (Holdings) Co., Ltd. In 1992 it invested in Winland, a listed company, which was renamed China Resources Enterprise.¹

Lippo

The House Committee on Government Reform and Oversight described China Resources as "a Chinese Government owned company which is a joint venture partner with the Lippo Group and partner in the Lippo controlled Hong Kong Chinese Bank." In late 1992 China Resources bought 15 percent of the bank, and it "subsequently infused the failing LippoLand with tens of millions of dollars, effectively bailing the Riady family out of a precarious financial situation. Since 1993, the Lippo Group and China Resources entered into dozens of joint venture projects in the People's Republic of China."²

The Senate Committee on Governmental Affairs called it "a company wholly-owned and operated by the PRC government" and Lippo's "principal partner on the mainland." In the spring of 1997, according to the Senate committee, Stephen Riady announced that the Hong Kong Chinese Bank would be renamed the Lippo China Resources Bank "to reflect that China Resources is now an equal partner with Lippo in the bank," and when Lippo Land, the Indonesian company building two new cities outside Jakarta, faced a cash flow crisis that threatened a run on Lippo Bank, China Resources "injected tens of millions of dollars into Lippo Land and became a substantial partner in that entity as well." The committee recorded the testimony of Thomas Hampson, president of Search International, that China Resources "is widely reported to be a corporate agent of economic and political espionage serving the government of China." The committee added: "Intelligence officials have confirmed in the press that the Chinese intelligence establishment is heavily involved in the operation of China Resources, and that China Resources selects overseas business partners in part on the basis of their value as potential intelligence gatherers."³

James Alexander, a former chief executive of LippoBank, told the Senate committee that in 1991 Huang was sent to Beijing to negotiate with China Resources over a Lippo proposal to join forces to buy the Hong Kong branch of the Bank of Credit and Commerce International.³

Shen Jueren in Washington

In 1993 Huang and Mochtar Riady asked Commerce Secretary Ron Brown to meet Shen Jueren, chairman of China Resources and "a major partner of the Lippo Group." During the same visit Huang and Riady arranged a meeting between Shen and Vice President Al Gore. In a letter of October 7, 1993, Huang thanked Gore's chief of staff, Jack Quinn, for meeting Shen at the White House; Quinn told the House committee he had no recollection of meeting Shen or of the letter. The Senate committee found that Gore "may have met with Shen Jueren in the White House and also exchanged words with him at a subsequent DNC event," a Democratic National Committee function in Los Angeles on September 27, 1993, recorded on a White House audio tape. On September 23, 1993, Huang had drawn two checks of 15,000 dollars each payable to the DNC on the accounts of the Riady companies Hip Hing Holdings and Toy Center Holdings, and a third on September 27 on San Jose Holdings; the Senate committee described them as overseas-funded contributions from companies that lost money that year.²³

While Huang was at the Commerce Department, his telephone records showed four calls to David Chan, president of the Hong Kong Chinese Bank, "an interest jointly owned by Lippo and China Resources."⁴