Vietnam PM admits interest groups sway policymaking

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A man (L) stands in front of an ATM while a homeless man sleeps in front of an advertisement on a street in Hanoi January 3. Prime Minister Nguyen Tan Dung has acknowledged the surging influence interest groups have on the policymaking process, calling for increased transparency to tackle the issue.

Prime Minister Nguyen Tan Dung has become the second Vietnamese leader in the past three months to acknowledge the surging influence interest groups have on the policymaking process, arguing for increased transparency to tackle the issue.

"These interest groups could sway the decision making process [of the government]," Dung wrote in an article conveying his New Year message.

Dung has been the second leader to point the finger at this pervasive nuisance since Vietnam embarked on new economic reforms three months ago, exhibiting the country's determination to ward off one of the toughest hindrances standing in the way of fulfilling the intent of the shakeup.

At a meeting of the Party Central Committee in October, Party chief Nguyen Phu Trong stressed the necessity to restructure the economy along with overhauling the growth model, chalking out three priorities: public investment, finance and state-owned enterprises.

"The investment strategies, planning, and policies must not be swayed by interest groups," Trong said at that time.

Analysts have expressed concern that the reform path, albeit touted as a significant step, could face fierce resistance because it aims to loosen the grip powerful interest groups have on the political process. They add that special interests groups operate from behind the scenes, making their influence difficult to trace. For instance, golf courses and hydropower projects, which accrue profits for only a few interested parties, continue to sprout up in the country despite widespread public outcry.

"The execution of transparency and integrity [in the government decision-making process] will enable the public to have more of a chance to monitor government agencies, playing a crucial role in fending off the influence of interest groups," Dung wrote in his article. "That would ensure every government decision is made"¦ for the sake of the entire country."

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"Vietnam has made great strides in improving transparency in many areas, but there remains a long way to go," Victoria Kwakwa, the World Bank country director for Vietnam, said.

The Vietnam Development Report 2010, prepared by the World Bank together with other partners, pointed out that although a great many laws call for certain information to be public, in reality information is often difficult to obtain.

"Whether it is the unofficial payments that beset firms and citizens or the misappropriation of funds in state-owned enterprises, corruption forces the honest and hard-working people of Vietnam to run uphill; lack of transparency forces them to do it in the fog," Kwakwa said.

Analysts concurred that access to information is the key to curbing the unwanted authority of special interest groups.

"In Vietnam"¦ too many public policy decisions are shrouded in secrecy," Jonathan Pincus, a Ho Chi Minh City-based economist with the Vietnam Program at the Harvard Kennedy School, said.

"[The State Bank of Vietnam's] foreign exchange reserves are a state secret. This should be public information. The activities of state-owned enterprises [SOEs] are [also] state secrets," Pincus said.

"But how can we make SOE managers more accountable if these companies are not forced to release information about their activities to the public? What is the point of being a public company if information is not given to the public?"

Experts have blamed Vietnam's economic woes, including 18.13 percent inflation for 2011, on excessive investment in inefficient state-owned corporations, which gobble up capital and diversify from their core competencies into sectors such as property and stocks - both of which have faltered.

"The government needs to come out with a plan to barricade itself from influence of business interests but at the same time the government also needs to take care that Vietnamese businesses develop and prosper under fair rules for all," David Koh, a Vietnam analyst at the Institute of Southeast Asian Studies in Singapore, said.

But the bottom line is, according to analysts, the existence and influence of interest groups is not foreign to Vietnam, or any other modern government.

"Basically, everybody who should know already knows such a thing exists in Vietnam," Koh said.

"Ultimately, people will hear whatever the government says, but will only listen to whatever the government does."

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