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April 11, 2018 6:40 pm | FILED UNDER: politics

Zeman Laid Groundwork For CEFC’s Dealings With Russia

By ČTK Milos Zeman Ye Jianming Xi

Prague, April 11 (CTK) – Czech President Milos Zeman helped the CEFC Chinese firm establish contacts with Russian officials, according to China’s investigative magazine Caixin, which cites Ye Jianming, Zeman’s Chinese aide and CEFC protagonist who has been investigated in China recently, server Info.cz has written.

 

Addressed by CTK, Zeman’s spokesman Jiri Ovcacek has called the information a speculation he would not comment on.

 

According to Caixin, the CEFC based a part of its business on fictitious deals, thereby increasing its member companies’ turnover and its own chance in loan-drawing procedures.

 

Some time ago, the CEFC chose the Czech Republic as the headquarters of its activities in Europe. At the same time, it bought stakes in several Czech companies.

 

In the spring of 2015, Zeman appointed CEFC board of directors head Ye Jianming his adviser. He has repeatedly promoted the trading with China.

 

However, Ye got into troubles in China earlier this year. According to the information from the Czech Presidential Office, he has been investigated on suspicion of a breach of law.

 

It was the Caixin magazine that highlighted Ye’s troubles first. According to Info.cz, however, most of Caixin’s article about the CEFC’s foundation and business in China has been removed as a result of censorship.

 

An English translation of the article was released by Australian sinologist Andrew Chubb in late March.

 

The article is based, among others, on former interviews with Ye. In connection with the planned purchase of a part of the Russian Rosneft oil giant by the CEFC, Ye said the CEFC had dreamt about cooperation with Russia since 2011-12, when Zeman pulled the strings and built “bridges” between the CEFC and high-ranking Russians.

 

Zeman, whom Ye described as “our good friend”, was not Czech president at the time. Nevertheless, some members of the Czech Social Democratic Party (CSSD) worked in China [in support of the CEFC], Ye is quoted as saying.

 

The CEFC-Rosneft deal worth 9.1 billion dollars has not been struck yet.

 

Citing a member of the CEFC management, Caixin wrote that it is not difficult to gain contacts with influential people in the Czech Republic, mainly via mediators. Among them, one of the most important is Jaroslav Tvrdik, former Czech defence minister for the CSSD, who is now deputy head of the CEFC Europe board of directors.

 

In an interview with Caixin, Ye Jianming said the CEFC’s main goal is to penetrate the Czech market and use it for investments in international banking. In the Czech Republic, it mainly meant the acquisition of the J&T Finance Group, in which the CEFC bought a 10-percent stake. Later it wanted to increase its stake to 50 percent, but the deal was halted by the Czech central bank (CNB), and the CEFC eventually withdrew its application following its troubles in China in March.

 

The Sinopsis.cz project, cited by Info.cz, describes the CEFC business model as “acquisitions with the help of banking loans”. This system helped the CEFC increase its turnover many times in the past eight years. According to Ye, the firm’s goal was to join the world’s 500 biggest companies as soon as possible.

 

The CEFC also artificially raised its turnover by buying goods and formally re-selling them among various parts of the CEFC chain, Info.cz wrote.

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