Foreign studies call for land policy reforms

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International experts have called on Vietnam to fight land management corruption by increasing transparency


Farmer Nguyen Van Tran works on a rice field adjacent to an industrial park on the outskirts of Hanoi. Experts have called for policy reforms and transparency to reduce the risk of corruption in land management.

Nguyen Thi Thanh Huong sold her house in Ho Chi Minh City's District 8 on Friday (January 21) after paying VND30 million ($1,540) to a real estate dealer.

In addition to the dealer fee, Huong says she shelled out several million more to a broker who promised to "lubricate" official procedures.

"It's great to have the dealer conducting almost all procedures because I wouldn't know what documents to file or steps to take," said the 50-year-old housewife.

Huong said she would be ready to pay any fees the broker demanded in order to ensure the smooth sale of her house before Tet, Vietnam's Lunar New Year.

Dang Thi Thanh Nga managed her house sale alone. Brokering the sale on her own took more time but less money, she says.

Nga and the buyer of her District 5 home spent a lot of time studying official procedures in order to sell her house on Nguyen Thi Street in District 3 last month.

"Obviously, the process was complicated but we finally managed to complete the sale," she said. "Sometimes we had to return to an office twice or three times just to complete a single step because we lacked some necessary papers."

Clearing the air

Experts at home and abroad are calling on Vietnam to tackle land management corruption by simplifying official procedures.

"It is natural to wonder about the level of corruption, but it is much more important to understand the reasons for the corruption and what can be done to reduce the risk" said Victoria

Kwakwa, Country Director of the World Bank, in a statement on Wednesday (January 19) during the release of two new studies concerning the issue.

A recent study commissioned by the Embassy of Denmark, the World Bank, and the Embassy of Sweden, entitled "Recognizing and Reducing Corruption Risks in Land Management in Vietnam" systematically examined the process of obtaining a land-use rights certificate and the processes associated with land acquisition and allocation.

Imminent domain

The practice of compulsory land acquisitions, especially when prices are set below market values, creates large uncontested profits for some, and this can contribute to corruption, the report found.

"Sometimes such acquisitions are needed, for example when building a road or a public project, but direct negotiations are better for private projects", said Professor Dang Hung Vo, former deputy minister of Natural Resources and Environment and a contributor to the report.

"When compulsory land acquisition is necessary, an independent mechanism for determining prices is needed to bring them more in line with market prices," he said. "This would help reduce the large number of complaints about compensation."

The report also found the process of obtaining a land-use rights certificate to be unnecessarily complex and time consuming.

"This creates incentives to cut corners by working through intermediaries or by making unofficial payments," the report found.

The report's authors also called for new approaches from both the officials who handle land transactions and for those entrusted to investigate allegations of wrongdoing.

They also urged Vietnam to push for income and asset disclosures from key officials as a stronger tool for fighting corruption.

Full disclosure

According the "Survey Report on Information Disclosure of Land Management Regulations," nearly all state websites contained instructions for obtaining a "red book" [Vietnam's equivalent of a deed]. However other key documents were much harder to find.

The parallel study, commissioned by the World Bank and carried out by the Vietnamese think tank Development and Policies Research Center (DEPOCEN), sought to evaluate how well various transparency provisions are implemented in practice.

The report's authors stressed that improving transparency would make corruption more difficult to hide and would provide citizens and the business community with much needed confidence in the integrity of the decisions that affect them.

The study also included a "best practice" survey of 12 provinces and cities. At the communal level, Ho Chi Minh City was found to be the best performer, followed by Khanh Hoa, Hanoi and Hung Yen.

At the district level, Khanh Hoa, Hanoi and Da Nang were listed as the nation's top performers, followed by Can Tho and Ho Chi Minh City.

At the provincial level, the top performers were again Da Nang, followed by HCMC, Hung Yen, Thai Binh, Can Tho, Tien Giang and Ben Tre.

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