It is Denmark's turn to suspend aid to Vietnam on fraud report

TN News

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Denmark has suspended aid for three climate-change research projects in Vietnam due to reports of fraud, its development minister said.

Danish Minister of Development Cooperation Christian Friis Bach said an independent review by London-based accounting firm Price Waterhouse Coopers had uncovered "numerous irregularities" in the three projects funded by Danida, the Foreign Ministry's aid organization.

"It is important to crack down on those caught misusing Danish aid funds in order to clearly demonstrate the consequences," Friis said on the ministry's website.

"Those that cheat must be stopped and punished."

The fraud report found "excessive charges for local services, questionable service contracts, major discrepancies between project ledgers and unauthorized spending," the Copenhagen Post reported.

An official investigation is under way but the alleged fraud is estimated at around US$548,400.

Friis has asked the Vietnamese government to assist with the investigation.

In 2008 Denmark started a pilot research program on climate change in Vietnam, providing $7.5 million, including nearly $3 million in grants.

The program supported four projects studying the relationship between climate change and livelihood in Vietnam's deltas and mid-central.

Similar programs were launched in Ghana and Tanzania at the same time, and the minister said he would look into those too.

He said the misuse would be made public on Danida's website.

Vietnam's other foreign donors too have raised concerns over the country's use of their ODA at annual Consulting Group conferences, especially since a bribery scandal related to Ho Chi Minh City's VND13.4 trillion ($642.7 million) East-West Highway came to light.

Huynh Ngoc Si, former deputy director of the city's transport department, was sentenced to life in 2010 for taking bribes of $262,000 from Tokyo-based Consultants International to help the company win contracts to build the Japanese-funded highway.

The revelation led Japan, Vietnam's top ODA provider, to suspend development assistance to Vietnam from December 2008 to February 2009.

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