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The swelling number of state-provided cars in Vietnam is a luxury that the country's struggling economy cannot afford, experts say


A state-provided car (C) in Ho Chi Minh City. The increasing number of state-provided cars in Vietnam is a luxury that the country's struggling economy can ill afford, experts say.

Bureaucrats all over the world are famous for their penchant for showering themselves with largesse at the tax payers' expense, and a recent report from the Public Asset Management Department shows Vietnam is no exception.

The department estimates that as of June 24, 2010, Vietnam had around 26,000 cars valued at about VND13 trillion (US$680 million) meant for official use. Ho Chi Minh City led the pack with around 1,000 state-provided autos, followed by Hanoi with 800 cars, the report said.

In July 2006, when around 19,300 state-provided cars were recorded nationwide, Prime Minister Nguyen Tan Dung applied the brake on further purchases, but released it in July 2009.

The report points out that many provinces and cities have spent more money than they were allowed to on buying official vehicles. Provinces are only authorized to purchase cars that cost less than VND700 million each; many have ignored the regulation, the report said.

"The increasing number of illegitimate state-provided cars has done nothing but confirm the egregious squandering of the state budget," said Dr. Le Dang Doanh, an economist with the Hanoi Economic College.

"This is a huge paradox compared with the size of Vietnam's economy," Doanh said.

Around 70 percent of all Vietnamese citizens still depend on agriculture for their livelihood. Per capita income is about $1,000 and the minimum government salary is VND730,000 ($38) per month.

The World Bank has also said that Vietnam's budget deficit was "very high" at 8.4 percent of gross domestic product (GDP) in 2009. "I think this is not just a question of money. People would need a clear and transparent explanation for the use of state-provided cars bought with their tax money," Doanh said.

Unhealthy privilege

Recent media reports have highlighted how state-provided cars have been used for different unofficial purposes.

A bunch of official cars, distinguished from others by their green license plates, were found parked in front of many schools in Hanoi and HCMC last month when the national college entrance exams took place.

In February this year, state-provided cars thronged the site of a major lunar festival in the Mekong Delta province of An Giang. The cars were spotted littering closed streets and halting traffic throughout the city.

"Ordinary people can easily spot a green-plate car parked at a restaurant or a wedding party," Doanh said.

Those traveling in official cars are apparently immune from punishment for any traffic law violation, Doanh said.

"This is a very unhealthy privilege which should be stripped," he added.

"˜The government knows all'

"26,000 cars and VND13 trillion are indeed startling figures," said Nguyen Minh Thuyet, a prominent parliamentarian.

Both Thuyet and Doanh urged a comprehensive probe of all state-provided cars to ensure they have been used properly.

But they remained doubtful that drastic and serious measures would be taken against the misuse of state-provided cars.

"Punitive measures will only work when they are enforced frequently and seriously. Otherwise they will turn out to be just lip service," Thuyet said.

"I think the government knows all about the squandering of money [in buying state-provided cars] because it is nothing new," he added.

Thuyet recalled a plenary session of the National Assembly in 2005 when the then Finance Minister Nguyen Sinh Hung took the floor to address the issue of wasting money in buying state-provided car.

Hung, now the deputy prime minister, was then quoted by the media as saying that officials who waste state money on buying cars should not get any promotion or nomination for awards.

"But I have not seen anyone punished until now," Thuyet said.

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