4 NATION APRIL 13 - 19, 2012 New repor as entrenc Foreign analysts complain nothing ever changes; history shows local firms

PHOTO: BLOOMBERG accept bribery A PetroVietnam pump outside Ho Chi Minh City. PVN chairman Phung Dinh Thuc has denied allegations that the group made losses by investing in non-core areas. as par for the course PetroVietnam leader By AN DIEN

national survey released denies group made losses last week has found that Awhile local companies By THAI SON-MAI HA wrongdoings involving more Prime Minister Nguyen Tan complain that corruption makes than VND18 trillion, including Dung. business more difficult, they see The state­owned Vietnam Oil VND2 trillion from equitization Thuc admitted the allocation bribery as not only a key to and Gas Group (PetroVietnam of its affiliates. was wrong but said the group success, but as an inseparable part or PVN) has not made any loss Prime Minister Dung has was only looking to accelerate of Vietnamese business culture. in its business activities, but has agreed with their proposals on the projects rather than waiting Sixty­three percent of respondents made ineffective investments in dealing with PVN wrongdoings. for local authorities to the survey by the Vietnam some areas, PVN chairman He has instructed PVN to to compensate relocated Chamber of Commerce and Phung Dinh Thuc said at a press review its investments in non­ residents in the sites where Industry (VCCI) said sending gifts, conference Monday (April 9). core businesses and make the projects were to be money to express gratitude to PVN held the press briefing proposals on solving its implemented. government officials is a common after the Government financial problems. He said PVN will finish custom. 48 percent of companies Inspectorate released its Thuc, the PVN chairman, told revocation of capital from non­ interviewed were willing to pay conclusions about the group reporters that PVN, which was core projects by 2015 as bribes – often in the form of cash, losing VND18 trillion (US$863 built into multi­sector group, instructed by the government. luxury vacations, or lavish dinners – million) in the use of capital and had made “great contributions” At the press briefing, Thuc did in a bid to win contracts to provide assets and the management of to the national economy over not mention the responsibility of items or services to the public sector, investment and construction the last years. Since 2009, when Transport Minister Dinh La the study said. investments.” between 2006 and 2010. the economic conditions Thang for his role at the helm of Some 70 percent of respondents The study, which interviewed Inspectors said the state­owned worsened, the company gained PVN. agreed with the statement: “In case 270 businesses in Hanoi, Ho Chi group had been found making little profit, but did not cause Thang, who has not hesitated of working with government Minh City, Hai Phong, Da Nang, investments in non­core any loss, he said. to propose and take offices, give money first and Dong Nai, and Can Tho, also said businesses like finance, According to the Government controversial measures since he everything will be easy.” 80 percent of respondents insurance, real estate and Inspectorate, PVN earmarked took office last July, was And a staggering 90 percent acknowledged corruption had banking that proved less more than VND15.6 trillion chairman of PVN between agreed that “it is impossible to hindered their operations. profitable than its main business. ($748 million) earned from October 2006 and August 2011. eliminate corruption in a relation­ While some foreign analysts They have proposed that selling oil and gas for financial In a statement after being based business culture.” took the VCCI survey as a Prime Minister Nguyen Tan activities that are not listed in appointed as Transport Minister, But none of this is very different reminder of the fact that private Dung instruct relevant agencies key oil and gas investment Thang vowed to improve traffic from the findings of other reports companies need to help fight to retrieve more than VND1.6 projects. infrastructure and reduce traffic issued years ago. corruption, others worried that the trillion (US$76.7 million) that Thuc argued that the accidents and gridlock as his “Not enough has been done on practice of giving and receiving PVN paid in advance to other government had not yet issued main initiatives. this regards and the practice under­the­table money was so companies for investment. They any criteria for key oil and gas Amid a slew of measures continues,” said Jairo Acuña­ common, and therefore “normal,” said some of the recipients had projects at that time. proposed by Thang that Alfaro, policy advisor on anti­ for local companies that they made no plans to return the The inspectors had also said subsequently came under harsh corruption for the United Nations might not regard it as a problem. money and others had not been Development Program (UNDP) in that PVN had allocated VND622 criticism, and enthusiastic Business as usual able to make repayments. billion ($29.8 million) to Soc support, were high vehicle fees Vietnam. “This new survey re­ The inspectors have also Trang, Ha Tinh, Quang Binh, to limit the use of personal cars, confirms the challenge to address According to the World proposed that relevant agencies and Hau Giang provinces to and a regulation banning the problem of ‘systemic’ Economic Forum Global affix responsibility and punish complete site clearance for its transport officials from playing corruption in Vietnam, and Competitiveness Report 2009­2010, those involved in other projects without approval from golf. VW uncovers ‘business as usual’ companies operating in Vietnam practices that hamper further cite corruption as one of the top APRIL 13 - 19, 2012 NATION 5

Upcoming events n APRIL 13-14 (FRIDAY- SATURDAY): Oratorio “Messiah” rt confirms corruption Concert with conductor Graham Sutcliffe will begin at 8 p.m. at the Hanoi Opera House, 1 Trang Tien Street. Performers will include Thang Long (Soprano), Huong Diep (Alto), Thanh Binh (Tenor), hed as ever Manh Dung (Bass), the Hanoi International Choir, Hanoi Freude conducted an Enterprise Survey as Choir, Choir of Vietnam National has been done in more than 100 Opera and Ballet and Choir of the countries around the world. “The University of Art Education. results showed that firms in Vietnam were more likely than Tickets costing VND200,000, firms in most countries in East 350,000 and 500,000 are available Asia to say that unofficial at the Hanoi Opera House or can payments are expected to get be booked at www.ticketvn.com, things done, while at the same [email protected]. For free time relatively few firms identified delivery call 0913 489 858 or corruption as a major constraint 0983 067 996. for their operations,” Anderson Vietweek n THROUGH APRIL 15 (SUNDAY): told . An exhibition on Manga art entitled The World Bank­commissioned “Women & Manga: Connecting with Vietnam Development Report 2010—Modern Institutions Cultures beyond Japan” is being apparently summed it up best, “If held in Hanoi at the Japan firms adapt to corruption to the Foundation Center for Cultural extent that it becomes normal and Exchange, 27 Quang Trung Street, less of a problem, even if no less Hoan Kiem District, Hanoi from frequent, it becomes even harder March 21 to April 15. The exhibition to eradicate.” is a visual introduction of shōjo manga, focusing on the artworks ‘Grand corruption’ of two leading Japanese comics The Finnish Embassy in Hanoi artists Hideko Mizuno and Moto said in a 2008 study that Hagio. For more information, visit enforcement of Vietnam’s Anti­ www.jpf.org.vn. Entry is free. Corruption Law 2005 was strong at first, but weakened thereafter. n APRIL 18 (WEDNESDAY): According to Vietnam’s EuroCham Annual Dialogue with Provincial Competitiveness Index HCMC Tax Authority 2012 will take (PCI) 2011, foreign enterprises do place from 8:30 a.m. to 11:30 a.m. not think highly of efforts to at Diamond A, Sofitel Saigon Hotel control corruption in Vietnam. Plaza, 17 Le Duan Street, District 1, The PCI survey recorded a HCMC. Guest speakers: Mr. deterioration of transparency Nguyen Trong Hanh - deputy associated with a continued director, HCMC Tax Department; importance of personal Mrs. Tran Thi Le Nga - chief of connections to facilitate access to Taxpayer Services Division; and businesses. Grand corruption like Mr. Do Quoc Tuan - deputy chief procurement bribes have tended to increase over time, it added. of Taxpayer Services Division. Steven Dimitriyadi, president of Admission fee: VND1 million for the Hong Kong­based Quartexx members and co-hosts and VND1.3 Holdings that provides outsource million for non-members. Contact services in Vietnam, said specific Ms. Thuy at (08) 3 827 2715 or email procurement fraud and corruption [email protected] for PHOTO: BLOOMBERG risks in Vietnam include instances more information and registration. Migrant construction laborers work on the foundation of a new restaurant in the central business district of Hanoi. 48 percent of 270 where business professionals new n APRIL 20 (FRIDAY): The Canadian companies surveyed were willing to pay bribes in a bid to win contracts to provide items or services to the public sector, according to a recent to the country are exposed to Chamber of Commerce will host national survey. longer procurement chains, a its 7th Annual VinaCapital CanCham different economic climate, ten most problematic factors for notice or reason, close formal and corruption as a significant unfamiliar trade practices, Open Charity Golf Tournament doing business in the country. informal ties with officials and constraint on their business language and cultural barriers, at the Long Thanh Golf Club Business executives surveyed in patronage systems perpetuate activities in Vietnam. Experts among others. with a Shotgun start at 11:45 a.m. the report indicated that the corruption and the ubiquitous use explained this away on the long­ “Business success in Vietnam is Registration is now open and diversion of public funds to of facilitation payments by time institutionalization of bribes, often due to contacts, but what participants are encouraged to companies, individuals or groups companies when dealing with which means that companies may may be regarded as an acceptable register in teams of four. due to corruption is quite frontline civil servants, according have learned how to live with business practice in Asia, could be Registration is limited and must common. This view was to the Bertelsmann Foundation corruption to the point that they illegal elsewhere,” Dimitriyadi be done in advance. supported by Grant Thornton 2008 report. Grant Thornton do not see it as a significant told Vietweek. Cost per golfer: VND2.5 million Vietnamʹs Investment Outlook Vietnamʹs Investment Outlook constraint on their activities. “The amounts paid to resolve for CanCham and co-host Survey 2009, in which 77 percent Survey 2009 also confirmed that “Recent surveys still suggest claims resulting from procurement members; and VND2.7 million for of the participants (all members of red tape, an uncertain legal system that although many firms fraud and corruption can be high, non-members. All proceeds will go the investment community) saw and underdeveloped encounter corruption and make but they are more likely secondary to Heartbeat Vietnam, which corruption as a substantial infrastructure have remained a unofficial payments, they often do to the loss of reputation and provides life-saving heart surgeries problem. problem for investors. so as a way of circumventing red damage to brands companies may Superfluous intermediary But businesses continue to say tape, speeding up procedures, or suffer for being associated with for poor Vietnamese children with administrative levels, a lack of what they have always said: they to get advantages for their firm,” such claims. congenital heart defects. Contact transparency in the decision­ have no choice. said James Anderson, senior “In this context, fraud and the CanCham Office at (08) 3 824 making process, administrative The World Bank Vietnam governance specialist of the World corruption prevention activities 3754 or [email protected] rules, regulations and procedures Development Report 2006 said Bank in Vietnam. may be the best investment of all.” for further details. that frequently change without only few companies ranked In 2009, the World Bank VW