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Background Briefing: Vietnam Corruption Barometer Carlyle A. Thayer July 10, 2013

[client name deleted] Towards Transparency justreleased the 2013 Global Corruption Barometer and the report specifically focuses on views and experiences of Vietnamese citizens. Here is the link to the report: www.towardstransparency.vn/gcb. We request your assessment of the following issues: Q1. What do you make of the key findings of the report? ANSWER: The key findings of the 2013 Global Corruption Barometer report confirm that public perceptions of corruption in Vietnam have become more negative over the last two years and the governments efforts to eliminate corruption have proved largely ineffective especially among the urban population. What the report does not tell us is how significant public perceptions of corruption are compared to other social issues such as inflation, drug use, human trafficking, fake goods etc. It should be recalled that senior party officials identified corruption as a major threat to the Vietnam Communist Party on the eve of the tenth party congress. During the period reviewed by the Report the control of the Anti-Corruption Steering Committee passed from the Government to the party. This Report should be instrumental in setting priorities in the campaign to end corruption. Q2. According to the report, only 24% of respondents perceive government anticorruption efforts to be effective. In contrast, 38% of respondents consider anticorruption efforts to be ineffective or very ineffective. Furthermore, the findings suggest a considerable loss of trust by urban respondents in Government anticorruption efforts over time, with respondents in 2013 indicating a far more negative view. Why has the public trust in the governments anti-corruption efforts been on the wane? ANSWER: Reporting on corruption in Vietnam is now much more widespread including both the official press and on the Internet by bloggers. There is greater public awareness of the issues, especially large-scale corruption cases such as Vinashin and Vinalines. A second factor is likely to be the downturn in the economy coupled with inflation. This suggests that government officials on fixed salaries are accepting bribes in order to make ends meet.

2 Q3. The police, medical and health services and land services were found to have the highest incidence of reported experiences of corruption. Once again, a majority of respondents (90 percent) who reported paying a bribe to the police noted that their last bribe was paid to the traffic police. What do you make of these findings? ANSWER: The police are one of the most important daily interfaces between the public and the state. The police, like other public servants, are on fixed wages. They too need to accept gifts and bribes in order to survive in a difficult economic climate. Besides, there is a legacy of corruption by traffic police that creates the environment for further corruption. Q4. Sixth per cent of Vietnamese respondents believe that ordinary people can make a difference in the fight against corruption. However, when comparing these figures to responses in neighboring countries, Vietnamese respondents are actually the most pessimistic concerning their ability to effect change. On average, 76% of respondents from Southeast Asia believe that ordinary people can make a difference. What accounts for such pessimism? ANSWER: The Vietnamese political system mobilizes the people for all sorts of issues. Millions belong to mass organizations under the Vietnam Fatherland Front. Vietnam also has a system of letters of denunciation and a degree of tolerance. aggrieved citizens are permitted to stand in public with placards drawing attention to their complaints. Vietnam is still a developing country. While Vietnam encourages the people to voice their grievances, Vietnam also lacks effective independent and autonomous institutions found in other Southeast Asian countries that can take up public complaints of corruption on behalf of the people. Vietnamese people pay bribes largely to speed up the process in order to resolve an outstanding matter. But little progress has been made in reducing pervasive corruption by key institutions such as the police, judiciary, and land services. 5. According to the report, Vietnamese respondents are less likely to refuse paying a bribe than their peers in other Southeast Asian countries. Only 27% of Vietnamese respondents who had been asked for a bribe had ever refused to pay the bribe, strikingly fewer than any other country surveyed in the region. In contrast, 71% of Indonesian respondents had ever reported refusing to pay a bribe and between 4152% of respondents from Cambodia, Malaysia, the Philippines and Thailand have all refused to pay a bribe. Is it fair to say that the practice of offering and receiving under-the-table money has become an entrenched norm in Vietnam? How would that have a bearing on the countrys socio-economic development and on foreign companies doing business here in Vietnam? ANSWER: Vietnamese pay a bribe because it expedites whatever matter they are concerned with. In this sense paying bribes has become entrenched in societal norms. The Global Corruption Barometer did not address corruption involving foreigners doing business in Vietnam. Some foreign countries have laws making it illegal to pay bribes. Other countries do not have such laws and their businessmen presumably give gifts and facilitation payments to advance their business interests. Corruption of this nature increases transaction costs and make doing business more expensive. Corruption distorts market forces and makes the economy less efficient.

3 6. Any further observations you care to make on the findings of the report? ANSWER: This report has set a bench mark for Vietnam. National Assembly deputies can now focus on the portfolios of ministers whose sectors have been identified as most corrupt and judge their efforts when the next Global Corruption Barometer Report comes out. At the same time party officials will have to look critically at their own anti-corruption efforts and redouble their efforts before leadership selection at the next national party congress.

Suggested citation: Carlyle A. Thayer, Vietnam Corruption Barometer, Thayer Consultancy Background Brief, July 10, 2013. All background briefs are posted on Scribd.com (search for Thayer). To remove yourself from the mailing list type UNSUBSCRIBE in the Subject heading and hit the Reply key. Thayer Consultancy provides political analysis of current regional security issues and other research support to selected clients. Thayer Consultancy was officially registered as a small business in Australia in 2002.