BANGKOK — Vietnam has arrested officials in the foreign ministry, tourism, air, medicine and manufacturing and expelled them from the ruling Communist Party amid multimillion-dollar corruption scandals that have undermined Hanoi’s reliability in the US-Indo-Pacific economic framework and put to the test by the centers for disease control.
Corrupt officials have reportedly pocketed $240 million by tricking frightened Vietnamese into paying inflated fees for government-mandated Covid-19 repatriation flights from abroad and cumbersome permits. They also reportedly set prices for pandemic emergency medical supplies and equipment.
“The anti-corruption campaign is causing increasing uncertainty and concern among the population [Vietnamese Communist Party] Base,” said Australian Defense Force Academy Professor Emeritus Carlyle Thayer of New South Wales University in an interview.
“The steering committees for each of Vietnam’s 68 administrative units are expected to be more proactive in eradicating economic corruption.
“This increases the possibility of factional fighting at the national and local level,” said Australia-based Thayer, who returned from Vietnam two weeks ago.
“The US Indo-Pacific Economic Framework (IPEF) provides an opportunity for both sides to work together to address corruption issues.
“Vietnam’s participation in IPEF is seen as an opportunity to combine international commitments with domestic reforms,” Thayer said.
Vietnam’s other international partners are also concerned.
“The scandals are definitely damaging Vietnam’s image with governments, financial and development institutions and the private sector,” said Bangkok-based Kasit Piromya, board member of the ASEAN Parliamentarians for Human Rights (APHR).
“It also undermines the reputation of the CPV (Communist Party of Vietnam),” he said in an interview.
“The US and other investors and trading partners of Vietnam need to be more resolute on anti-corruption measures and the rule of law,” said Kasit, who was Thailand’s foreign minister from 2008 to 2011.
US President Joe Biden launched the IPEF on May 23, bringing together Australia, Brunei, India, Indonesia, Japan, South Korea, Malaysia, New Zealand, the Philippines, Singapore, Thailand and Vietnam.
The White House said one of IPEF’s “key pillars” is “criminalizing bribery according to UN standards … to enhance our efforts to fight corruption.”
Communist Party leader Nguyen Phu Trong, 77, won a third five-year term in early 2021, partly on a tough, ongoing anti-corruption platform.
“This anti-corruption fight is still very tough,” Trong said at the time.
When Covid-19 first hit Southeast Asia in 2020, Vietnam was lauded for efficiently controlling the virus with mass testing, strict lockdown measures and swift medical treatment.
But in 2021, Vietnam’s “demand for medical devices has skyrocketed, leading to more opportunities for corruption,” international law firm Baker McKenzie warned in Global Compliance News.
As the country’s infection rate surged from 1,500 in 2020 to 10 million in the first few months of 2022 – including 43,000 deaths – test kits suddenly became unusually expensive.
In response, the government’s anti-corruption crackdown accused more than 60 officials of price-fixing, including the foreign and health ministries.
Officials from the Ministry of Science and Technology, the Military Medical Academy, the state-run Viet A Technologies, Hanoi’s Center for Disease Control (CDC) and local health authorities were also arrested.
Hanoi’s CDC Director Truong Quang Viet was arrested on June 10 for “violating tendering regulations with serious consequences” and overpricing Covid test kits, police said, according to Vietnam’s Tuoi Tre News.
“Several officials – including senior military generals and directors of provincial branches of the [Hanoi] Centers for Disease Control – have been arrested or prosecuted for their involvement in the case,” VnExpress reported.
Viet’s predecessor, former Hanoi CDC director Nguyen Nhat Cam, was sentenced to 10 years in prison in 2020 for similar corruption related to Covid-19 testing equipment, costing the government $233,000.
US Vice President Kamala Harris opened a US CDC Southeast Asia regional office in Hanoi in August 2021, in part to work with the Vietnamese CDC Province.
“The U.S. CDC has a long-standing presence in Southeast Asia, including a CDC country office in Vietnam that has worked with the Vietnamese government to address shared health priorities for nearly 25 years,” the U.S. Embassy in Vietnam said in June.
No evidence or allegations of corruption has surfaced publicly involving the new US CDC regional office or American citizens.
In 2020, the U.S. CDC said its staff at the country office in Vietnam added eight “U. seconded” and 60 “local employees”.
In March, “the US CDC provided training on Covid-19 testing, biosecurity and sampling in 34 of Vietnam’s 63 provinces in Vietnam’s CDCs and provincial hospitals,” it said.
However, bribes have allegedly convinced Vietnam’s health authorities to ship overpriced Covid test kits to Hanoi’s CDC and several hospitals.
In January, Phan Quoc Viet — general manager of Viet A, which made the swab kits — “admitted” to paying $35 million in bribes to health and hospital officials, VnExpress reported.
“In April 2020, the company received a license to distribute Covid-19 test kits from the Ministry of Health,” reported Vietnam News.
“It has been delivering the test kits ever since [Vietnam’s] Centers for Disease Control and other medical institutions in 62 provinces and cities across the country.”
Various officials are said to have resold kits for public use for $20 – a 45% increase over their normal price – and raked in millions of dollars in illicit profits.
Meanwhile, Viet A’s PCR kits have been hailed as a successful joint venture with the Military Academy of Medicine. Viet A scooped a government medal awarded for its entrepreneurial role.
But suspicion arose after the World Health Organization (WHO) said Viet A’s kits “are not eligible for WHO procurement”.
This conflicted with an April 2020 boast by the science and technology ministry that the kits had been approved by the WHO. The Viet-A director claimed nearly a dozen countries want to buy them.
Investigators discovered that Viet A also allegedly lied, claiming it manufactured at least three million rapid test kits locally in 2021, which were actually cheap imports from China.
In June, officials threw out Health Minister Nguyen Thanh Long and Hanoi Communist Party leader Chu Ngoc Anh, accusing them of corruption.
The two allegedly violated party and government regulations, “caused serious consequences, damaged state money and assets, undermined the fight against Covid-19, caused social unrest and damaged the reputation of the party, the Ministry of Health and the Ministry of Science,” they said Politburo and Secretariat of Hanoi.
Long, a 56-year-old northerner, became health minister in November 2020 and has been tasked with protecting Vietnam from Covid-19. He also headed the Central Committee for Health Care.
Hanoi-born Anh, 57, served as Minister of Science and Technology from 2016 to 2020 before being elected leader of Hanoi’s Communist Party, coinciding with the worsening spread of Covid-19 in the capital.
In April, to fight corruption, the powerful Communist Party Central Inspection Committee proposed to the Politburo to discipline the entire party committee of the Ministry of Science and Technology from 2016 to 2021, according to VnExpress media.
The inspection committee proposed the same mass discipline for all members of the Party Committee of the Health Ministry from 2016-2021.
Allegations of bribery also rose. In April, the Ministry of Public Security arrested Deputy Foreign Minister To Anh Dung and two others allegedly linked to exorbitantly expensive air tickets for emergency repatriation flights.
Vietnam flew home more than 200,000 citizens from more than 60 countries and territories.
Dung, 58, arranged airline tickets for Vietnamese people in different countries, including poor migrant workers who lost their jobs abroad due to the economic devastation of Covid.
Others had to urgently fly back to Vietnam to help affected relatives.
In May, the former deputy foreign secretary was sentenced to four years in prison for selling counterfeit medicines.
In March, security officials arrested Binh Air Services and Tourism Trading Co. general manager Nguyen Dieu Mo on alleged charges of paying bribes for favors.
Some consular officials at the State Department have been arrested for “seeking personal gain” by allegedly passing bribes to licensing companies for arranging repatriation flights, the Public Security Ministry said.
The Communist Party Central Committee said in May that new anti-corruption steering committees would be set up in all provinces to root out illegal activities at the local level.
Richard S. Ehrlich is a Bangkok-based American foreign correspondent reporting from Asia since 1978.
Excerpts from his two new non-fiction books “Rituale. Murderer. wars. & Gender. — Tibet, India, Nepal, Laos, Vietnam, Afghanistan, Sri Lanka & New York” and “Apocalyptic Tribes, Smugglers & Freaks” are available at https://asia-correspondent.tumblr.com
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