China's Foreign Minister Wang Yi says clarification needed on Panama Papers

China needs clarification on the Panama Papers leak, said China's Foreign Minister Wang Yi.
China needs clarification on the Panama Papers leak, said China's Foreign Minister Wang Yi. PHOTO: REUTERS

BEIJING (Reuters) - China needs clarification on a massive leak of documents from a Panamanian law firm that revealed the offshore financial arrangements of some of the world's rich and powerful, including family members of China's top leaders, Foreign Minister Wang Yi said on Friday (April 8).

The Foreign Ministry has denounced accusations arising from the release of the so-called "Panama Papers" as groundless after their leak this week revealed offshore companies linked to the relatives of Chinese President Xi Jinping and other powerful current and former Chinese leaders.

Mr Wang's comments, made at a joint press briefing with the visiting German foreign minister, makes him the most senior Chinese official to acknowledge the matter.

The ministry has repeatedly said it will not comment when asked if Beijing would investigate.

"We have noted that the Panama side is making some explanations and clarifications. I'm afraid we first must get clarity and understand what it's really about," Mr Wang said.

Panama's government has said it will form an independent commission to review the country's financial practices and work with other countries over the leak.

Mr Wang did not elaborate on the documents or say if China was in touch with the Panama government about them. He said China's anti-corruption fight would continue.

"With the broad support of the Chinese people, China's anti-corruption struggle is continuing to move forward. As our leaders have said, we will always be on the path of anti-corruption," Mr Wang said.

China is in the midst of a massive crackdown on corruption overseen by Mr Xi, but the government has repeatedly had to swat away criticism that the campaign is more about an internal power play than actually tackling graft.

State media have largely avoided any reporting of the documents, which also revealed financial arrangements of prominent global figures, including friends of Russian President Vladimir Putin, relatives of the prime ministers of Britain and Pakistan, as well as Ukraine's president.

Iceland fell into political crisis this week after the papers linked the then Prime Minister Sigmundur David Gunnlaugsson to an offshore company that held millions of dollars in debt from failed Icelandic banks. He stepped down on Tuesday.

While holding money in offshore companies is not illegal, the International Consortium of Investigative Journalists (ICIJ), which has been reviewing the leaked documents along with dozens of other media organisations, said they could provide evidence of wealth hidden for tax evasion, money laundering, sanctions busting, drug deals or other crimes.

Mr Hu Dehua, the son of China's late reformist leader Hu Yaobang, was the first Chinese relative named in the documents to say he had an offshore company, telling Hong Kong media that he had nothing to hide.

Mr Hu said the registration was "above board" and that he used his own passport and real name, the South China Morning Post reported on Friday.