Monday, December 1, 2003
Red tape, graft hinder business in Vietnam: Survey
Reuters Hanoi, December 1
Foreign businesses blame Vietnam's red tape and corruption for their decisions not to invest in the country, which is falling behind booming China, a survey showed on Monday.
Hanoi has been trying to address those problems, but the Vietnam Business Forum, a private sector group that seeks to improve investment conditions in the country, on Monday issued a survey of business sentiment that expressed continuing concerns.
Of the 143 foreign and local firms that responded to the October survey, about 23 per cent said they planned no expansion of their business, with 54 per cent of those complaining that bureaucracy and corruption were the biggest hindrances.
Vietnam this year held a high-profile trial of the Nam Cam mafia gang that implicated bribe-taking former government officials. Last week prosecutors put in the dock two former vice ministers of agriculture accused of embezzlement.
It has also begun a "one-stop" approval process for investment and other procedures to cut away layers of bureaucracy that have long been the bane of investors.
While acknowledging progress, the forum, attended by scores of foreign and local businesses and government officials, said too many issues remained unresolved in the economy, which is one of Asia's most robust but is not performing as well as giant neighbour China.
"At the present rate of reform, it will take another 16 years" before Vietnam's economy can take off, said Tony Salzman, a businessman based in Vietnam who heads the manufacturing and distribution working group of the forum.
"China is rolling forward," Salzman told the audience, who included Deputy Prime Minister Vu Khoan and Minister of Planning and Investment Vo Hong Phuc.
Khoan said Vietnam needed to continue to improve the investment environment. Its priorities included "combating corruption and red-tape and building a cleaner and more effective apparatus," he said.
But those pledges are not new to the foreign businessmen who have attended previous gatherings.
"Vietnam has committed to doing things in its own time and way," said one. Salzman said it was clear Vietnam had much more to do on fighting graft, noting that an attempt to set up a working group on transparency in awarding contracts by tender had fizzled after government respresentatives declined to join.
The issue "is considered so hot that no one wanted to attend the meeting", he said.
Hanoi said recently that up to 30 per cent of infrastructure project capital had been diverted into the pockets of "unscrupulous" officials, consultants and contractors.
© Hindustan Times Ltd. 2003.