Rocky road ahead for Vietnam's new leadership
The internal politicking is over, the bloodletting has been
accomplished and Communist Vietnam's new government has
had its democracy credentials rubber-stamped.
However, the twin tasks of addressing fundamental economic
weaknesses and eradicating rampant corruption, key factors
in declining foreign investment levels, are likely to prove more
of a long-term headache.
The primary issue is whether or not Prime Minister Phan Van
Khai and his new cabinet have the credentials and the teeth to
steer the country towards its ultimate destination, World
Trade Organizaton (WTO) membership.
Last week, the National Assembly, often derided for being a
Communist Party drum used to beat its democracy credentials, toed the line and approved the final steps in a
government shake-up involving 14 ministerial changes.
The reshuffle was decided in July by the Party's secretive Central Committee, which also ousted two senior
members for links to southern crime boss Nam Cam in a gesture towards an unprecedented wave of public
discontent over official corruption.
More than 100 other officials have been suspended or arrested, but despite unsavoury rumours about the reach of
Nam Cam's cash-offering tentacles within the Party, no other high-ranking heads have rolled.
During its two weeks of closed-door deliberations, the 150-strong committee also agreed to maintain the status
quo in the country's leadership troika by reappointing Khai and President Tran Duc Luong to sit alongside Party
supremo Nong Duc Manh.
Emphasizing their policy of maintaining stability, those appointed to head the justice, industry, transportation,
construction, planning and investment portfolios were all deputy chiefs of their ministries.
Just as significantly, Vu Khoan, who pushed through the tariff-slashing bilateral trade agreement (BTA) with the
United States despite opposition from conservatives, was elevated to one of three deputy prime ministerial posts.
"We feel there is a strong sense of momentum," said Andrew Steer, the World Bank's director in Vietnam.
"Good plans have been made in a number of very important areas and now the name of the game is
implementation. So there are certain advantages to having those who designed the plans being in charge of the
implementation."
Steer cited banking reform, improving the climate for private enterprise, widening Vietnam's trading window with
the rest of the world, budget transparency and better allocation of public funds as the main areas likely to benefit.
But he cautioned: "Although these have started there is still a long way to go to implement them."
Steer also said legal and public administration reform needed urgent attention, two areas where the principles of
change have been agreed but the blueprints remain on the drawing board.
Carl Thayer, political analyst at the Australian Defence Force Academy, believes the new line-up keeps Vietnam
on track to joining the WTO, which World Bank officials say could happen as early as 2006-07.
"Vietnam is now better equipped to move forward on implementing the BTA with the United States and eventually
achieving WTO membership than ever before."
Other analysts are not convinced that Khai, a 68-year-old Soviet trained economist, is the right man to helm the
sluggish Vietnamese reform vessel.
"Phan Van Khai has had a mixed record. Personally I think he has been a let down," said Zachary Abuza, political
scientist at Simmons College, Boston.
"When he came into office fellow Vietnam watchers had really high expectations for him and believed he was the
man to usher in great reforms.
"But people I have spoken to who know him say that his heart is in the right place but he has always been busy
fending off attacks from conservatives to do anything."
However, agreement is universal on the importance of taking meaningful steps to tackle corruption, a phenomenon
that has raised alarm bells within the international donor community guiding Vietnam's transition to a market
economy.
"The all pervasiveness of corruption in Vietnam, inaction on complaints made against 90-plus National Assembly
deputies and the failure to punish top level officials will continue to lead to cynicism," said Thayer.
"The Party knows that corruption is the cancer eating away at their legitimacy but they want to treat the symptoms
not the cause."
This, Abuza says, is having a direct impact on the bottom line. "Foreign investors are not making enough money to
justify this added 'cost of doing business'."
If WTO membership and repeating its feat of halving poverty and doubling gross domestic product between 1990
and 2000 by 2010 are to be realized, the message is loud and clear: the government cannot afford to stand still.
Agence France Presse - August 11, 2002.
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