Ineffective law enforcement has turned Hanoi into a smuggling hub where counterfeit products are produced, consumed and transited.
During a conference on the matter held Thursday in the capital, Nguyen Duc Chung, director of the Hanoi Police, said scores of forgers operate in the city, which is also a waypoint for smuggled goods moving south from China and Thai knock-offs moving north from the road through Laos.
Hanoi police recently seized 60 tons of traditional medicine and nearly one ton of firecrackers smuggled from China.
Chinese tobacco has been spotted in Hanoi slapped with stickers from the local brand Vinataba.
Chung said groups of vendors operating in major markets in the capital (such as Dong Xuan and Ninh Hiep) make direct orders for Chinese counterfeits over the phone.
The goods are smuggled via rail or truck with help from fake companies operating along the border.
Nguyen Van Can, deputy head of the General Department of Customs, said law enforcement agencies need to dig deeper into the networks operating around the border gates, Noi Bai International Airport and train stations.
Can said customs officials must pay more attention to fake food products.
He said nearly 2,000 businesses reported the importation of more than US$300 million during the past year, but a lot of that turned out to be fake products made in Vietnam.
"Go to any street in Hanoi and you can see a lot of fake products. I’m sure the ward and commune officials are aware of them.” -- Nguyen Tien Luc, deputy head of Crime Prevention Department at the Ministry of Public Security.
He said officers need to trace fraudulent products back to their point of origin and to find out if any civil servants play a role in the supply chain.
Do Hoang Anh Tuan, vice minister of Finance, said the Hanoi Customs Department must beef up surveillance as “the chances of smuggling are very high.”
Tuan said Noi Bai airport alone receives around 200 tons of cargo a day and questioned the ability of Hanoi’s Tax Department.
“There’s a household retailer in Ninh Hiep market that owns four to five trucks and employs 20 drivers. How have they got away with declaring a monthly income of VND2-3 million?”
Do Thang Hai, vice minister of Industry and Trade, criticized the loose management of low-level officials and cited rampant tobacco smuggling as an example.
“Nearly 700 million packs of cigarettes are smuggled into the country every year, but only one percent are seized, denying the economy more than VND6 trillion (US$283.2 million) in tax revenue,” Hai said.
“Illegal cigarettes are being sold all over the street. Ward and district officials could easily seize them. They need to take some responsibility.”
Nguyen Tien Luc, deputy director of the Crime Prevention Department at the Ministry of Public Security, made the same observation.
Deputy Prime Minister Nguyen Xuan Phuc speaking at a conference in Hanoi to address the poor results of the fight against smuggling on August 14, 2014. Photo credit: Vietnam News Agency
“Go to any street in Hanoi and you can see a lot of fake products. I’m sure the ward and commune officials are aware of them.”
He asked Hanoi officials to cooperate with forces in neighboring and border provinces if they want to effectively prevent smuggling.
He also said punishments for smuggling should be tightened.
Less than 10 percent of smuggling cases carry criminal charges, he said, citing official statistics.
People involved in more than 90 percent of the rest receive cash fines they can afford to ignore, he said.
A report from Hanoi's Market Management Department showed that the city busted 9,414 smuggling cases this year but only 34 people involved in 31 cases were investigated on criminal charges.
Deputy Prime Minister Nguyen Xuan Phuc, head of the country’s corruption prevention committee and the man who has spearheaded Vietnam's fight on commercial fraud, admitted that many officials have turned a blind eye to smuggling for personal gain.
Phuc asked Hanoi authorities to identify the specific responsibilities of each government unit to reduce the chance of corruption.
“District heads will be dealt with if they allow smuggling to go on in broad daylight,” he warned.