News / Cosco box-making unit's ex-chairman 'arrested' a day after resigning

Liu Chong, former chairman of Cosco Shipping Development (CSD), the group’s ship-leasing and container manufacturing division, has reportedly been arrested by the Chinese authorities, just a day after his sudden resignation.

CSD had announced his resignation on Tuesday, saying he was “unable to devote sufficient time to perform duties by reason of personal affairs”. It added that Mr Liu had no disagreements with the board.

However, Chinese media has reported Mr Liu had been detained and his former office at CSD had been sealed. Mr Liu also stepped down as a director of China Everbright Bank, Cinda Asset Management and China Merchants Securities.

His downfall came after CSD announced on 30 October that Q3 23 net profit had plunged 90% year on year, to CNY101.1m ($13.87m), and by 67% for first nine months, to CNY1.2bn ($165.22m).

CSD, also parent of container manufacturer Dong Fang International and box lessor Florens, blamed the sharp decline in its financial performance on dismal demand for new containers, prompted by the end of the Covid-fuelled boom that saw freight rates regress from historical highs.

Caixin Global, a Chinese financial news outlet, reported allegations that Mr Liu may have been involved in corruption at another company.

Prior to becoming CSD chairman in June 2022, Mr Liu was vice-chairman of its larger compatriot peer, China International Marine Containers (CIMC).

The Chinese government has come down hard on graft in recent years, resulting in reported detentions of several executives at Chinese finance lessors. In August, there was talk that China United Lines’ co-CEO, Raymond Chen, had been detained, as the state-controlled intra-Asia carrier withdrew from all its long-haul routes and allowed its planned listing on the Hong Kong Stock Exchange to lapse.

However, days later, CULines released photographs showing Mr Chen at a company meeting, dispelling rumours.