Three more state officials were suspended Monday as probes into the bribe-taking allegations made by an executive at a Tokyo-based company continue in Vietnam, which was rocked by a similar case several years ago.
So far a total of four Vietnamese officials have been suspended after the Japanese media reported that the president of Tokyo-based railway consultant firm Japan Transportation Consultants Inc. (JTC) confessed to paying kickbacks to foreign civil servants, including a Vietnamese official, in return for orders it received for ODA (official development assistance) projects.
Tran Ngoc Thanh, chairman of Vietnam Railways Corp., the state-owned operator of the railway system in Vietnam, said Monday that two deputy general directors of the corporation, Ngo Anh Tao and Tran Quoc Dong, would be suspended for ten days to report on their management of relevant projects.
Tao currently oversees the company’s railway project management unit and Dong is the unit’s former director.
Another former director of the unit, Tran Van Luc, was also suspended. Luc is currently the head of the project management unit at the transport ministry's railways department.
Vietnam Railways Corp also announced Sunday that it had suspended the unit’s incumbent director Nguyen Van Hieu on the same grounds.
Tuoi Tre (Youth) newspaper reported on Monday that Vietnamese transport minister Dinh La Thang had instructed all individuals to halt their regular work to write reports about their involvement in the projects under investigation.
The instruction was also given to former officials involved in the projects, including those who have been appointed to other jobs or who have retired. All people involved will have to submit their reports by March 31.
Thang said his ministry would closely coordinate with the Japanese embassy in Hanoi and JICA in sharing information on the issue.
The transport ministry will set up inspection teams to inspect all projects that JTC is involved in, with railway projects coming first.
Thang instructed Vietnam Railways to suspend disbursement for contracts signed with JTC and halt negotiations with JTC on a sub-contract of the Hanoi tramway.
Japan's Yomiuri Shimbun newspaper reported Friday that Tamio Kakinuma, the president of JTC, admitted that the firm had paid kickbacks to foreign civil servants, including a Vietnamese official, in return for orders it received for ODA projects.
“The amount of each payment was determined according to the value of the orders received. For example, a total of 80 million Japanese yen was paid in return for an ODA project order worth 4.2 billion yen in Vietnam.”
The JTC president is believed to have explained that he had not known of the situation. The firm’s illegal payments were made on about 40 occasions from February 2008 to February this year, totaling 130 million yen, in relation to orders it received for five ODA projects, according to Yomiuri Shimbun.
The paper said that the company is believed to have paid the kickbacks to five government employees, including a senior official of an office responsible for project administration at Vietnam Railways and an official in a position of responsibility at the Directorate General of Railways at the Indonesian Transportation Ministry.
JTC has consulted on about 19 railway projects outside Japan since 2000, with a total investment of about 25 billion yen, Saigon Times has reported.
The company is a partner in the Vietnam Japan Consulting Joint Venture, which carried out a study on the 1,555km north-south railway in 2009. The project, whose cost was estimated at US$55.8 billion, was derailed in 2010 as the National Assembly, Vietnam's legislature, dismissed it as economically unsound.
Other partners in this joint venture are the Hanoi-based Transport Investment & Construction Consultant Joint Stock Company, Japan Railway Technical Service and Nippon Koei Company.
On Sunday, the transport ministry sent reports on the issue to the Prime Minister, the central Party Committee's Interior Commission, the Government Inspectorate, the Ministry of Public Security and the Ministry of Foreign Affairs.
At a meeting with Thang, Nguyen Van Hieu, director of the Vietnam Railways project management unit and the involved officials claimed that they did not receive a single dong from the Japanese company, Tuoi Tre reported.
Thanh, the chairman of Vietnam Railways, said it would be difficult to to prove or disprove the allegations soon due to the "half a house" of related documents involved.
“First, we will inspect documents involving the Ngoc Hoi – Yen Vien section of the Hanoi tramway project. After that, we will inspect all involved ODA projects,” he said.
Commenting on the impacts of the incident on the progress of the tramway project, Thanh said: “The biggest impact is confidence. We have to clarify everything to have trust between us and our [Japanese] friends.”
In a directive issued Monday, Deputy Prime Minister Nguyen Xuan Phuc asked the Ministry of Public Security to work with Vietnamese and Japanese agencies concerned to verify the case and launch criminal investigation into it if there is enough solid evidence.
This is the second time bribery allegations are being made involving Japanese ODA in Vietnam.
A similar case was exposed several years ago, leading Japan to temporarily suspend aid to Vietnam.
In 2008, another senior Vietnamese official was charged with taking bribes in 2003 from a Tokyo-based company in connection with a major infrastructure project -- a highway linking the east and west of Ho Chi Minh City. This project was backed by Japanese ODA as well.
Huynh Ngoc Si, former deputy director of the HCMC's transport department and head of the project, was originally sentenced to life in prison in 2010. Si was found guilty of receiving $262,000 from executives at Pacific Consultants International, or PCI, which was hired as project consultants.
An appeals court reduced Si’s sentence to 20 years in 2011.
The case rocked the country, prompting Japan, then Vietnam's biggest donor country, to suspend hundreds of millions of dollars in development loans in December 2008. Japan resumed the aid a year later.