By Chris Buckley

BEIJING, July 11 (Reuters) - China on Wednesday hailed the swift execution of the nation's former drug safety chief as a warning to other corrupt officials while detailing a web of graft that thrived for years without punishment.

Zheng Xiaoyu, former head of the State Food and Drug Administration, dominated television and print news a day after he was executed for taking some 6.5 million yuan ($850,000) in bribes to let medicine companies slip past his regulatory net.

The People's Daily, voice of the ruling Communist Party, said the punishment was intended to deter other wayward officials.

"Corrupt elements will be thoroughly investigated no matter who they are, how high their post, or how deep they hide, and there can be no appeasement or softness," the newspaper said.

"Whoever dares to spurn the state's laws and commit such outrages will be harshly punished by party rules and national law."

President Hu Jintao is preparing for a party congress later this year that is set to extend his tenure as party chief, which he has used to promote an image of tough, clean government.

But even as the media celebrated Zheng's death as a sign of the central leadership's commitment to clean government, official reports described a system of kickbacks and favours that went back a decade without public exposure.

From 1997, Zheng exploited his grip on drug approval powers to squeeze bribes that went to his wife and son, Xinhua news agency reported.

One company in Zhejiang province in the east fed "consultancy fees" and other rewards worth 2.9 million yuan to them, the report said.

From 2001, Zheng used a shake-up of drug approval rules to concentrate power with him and some close associates, and companies -- including some investigated for using fake ingredients -- were allowed to register substandard medicines for a price.

His demise "fully expressed the party's and state's unwaveringly staunch commitment to stamping out corruption", the People's Daily said.

His execution marked the first time China has imposed a death sentence on an official of his rank since 2000.

But advocates of political reform said that while the execution may scare some officials for a while, it would do little to staunch deeply rooted corruption that feeds of a booming economy.

"Zheng Xiaoyu's execution will satisfy ordinary people's desire for revenge and show that party leaders sympathise, but an occasional execution can't stop corruption," said Hu Xingdou, a professor of Beijing Institute of Technology.

"Corruption is so widespread because the risks to officials are so low. I think a lot of them will think Zheng lost out in a political fight or didn't pay off the right people."

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