While I was ensconced in writing the first draft of this paper, the Hong Kong business community was shaken by the news that Zhou Guanwu, aged 77, head of Shougang, China's largest and most powerful state-owned steel manufacturer, had been forced into retirement and that, the following day, his son, Zhou Beifang, head of a Hong Kong–based holding company of this enterprise, was under arrest and investigation in Beijing for his possible connection to serious economic crimes. Zhou Guanwu was reported to be close to Deng Xiaoping, a relationship that became manifest when Deng visited the company in 1992, a gesture of approval for the company's adherence to Deng's policies. Since then, Shougang obtained exclusive rights to launch businesses bearing no direct connection to the production or marketing of steel. This special treatment was widely seen to be linked to the cordial relationship between Deng and the Zhous. Furthermore, one of the subsidiaries of Zhou's holding company in Hong Kong had among its partners no other than Hong Kong tycoon Li Ka Shing and another Shanghai-based company in which Deng's second son, Deng Zhifang, was a vice managing director. The news broke amid rumors of Deng's deteriorating health. Many speculated that this event represented a showdown between two megapowers. Backed by the intertwined relation network (guanxi wang) between the two families, Shougang had reportedly been resisting the new tax reforms initiated by government policy makers, which would drastically reduce the profitability of the giant enterprise.