StrategicRISK roundtable hears that corruption is widespread in Vietnam and tackling it calls for long-term solutions
Corruption is a significant issue in many emerging economies, and Vietnam is no different.
It is especially prevalent at the “low, everyday level”, as a SR roundtable participant put it.
“Locals find ways to deal with corruption issues,” it was suggested, “but it is much harder for foreigners; they need advisers to get these resolved at a low cost.
“It’s about relationships; for example, every local business knows you need a good relationship with the local police officers”.
Vice-president of finance at agri-business Olam Vietnam Rajiv Shah names corruption as one of the most pressing risks faced by corporates operating in Vietnam.
Asia-Pacific director at specialist risk consultancy Control Risks Rupert Evill agrees that corruption is clearly an issue that needs to be addressed, but adds “you’ve got to understand the motivation of the person who is soliciting the payment – the person who’s doing it to subsidise his income because he’s underpaid and has a family to feed”.
Indeed, much discussion at the roundtable centred around the proposed long-term solution of raising remuneration for public servants to make bribery less prevalent, although it was pointed out that there were flaws in this proposal, not least of all Vietnam’s low tax base.
To read more about this issue, as well as tender space corruption, new anti-fraud measures and how Vietnam’s economy is still overly dependent on cash, download our new Vietnam Risk Report.