The practice of giving and taking bribes among businesses and civil authority organs has become an alarmingly common phenomenon, a survey of the Vietnam Chamber of Commerce and Industry shows.
75 percent of the respondents said ineffective law enforcement has allowed the spread of corruption (Photo: Viet Bao)
The Vietnam Chamber of Commerce and Industry (VCCI) and the Government’s Inspectorate yesterday announced the results of their study and survey on the issue of corruption that has existed in the relation between businesses and civil authority organs.
The survey was conducted through questionnaires sent to 270 businesses, seven discussion sessions for businesses in groups, and 12 interviews with entrepreneurs, business associations and civil servants in six provinces and cities: Hanoi, HCMC, Hai Phong, Da Nang, Can Tho and Dong Nai.
Most survey responses from businesspeople recognized that they are both the victims of corruption and the agents who cause the social evil.
Of the types of corruption, the most common ones are presenting 'envelopes' [with money inside], offering luxurious parties, and providing entertainment options like tourist trips.
40 percent of the businesspeople engaged in the survey said 'unofficial' expenses account for 1 percent of their companies’ annual operating cost, while 13 percent said the rate is much higher, at 5 percent.
80 percent of the respondents complained that corruption has created negative impacts on their business development, and added that they always have to think of ways to get rid of the chronic bureaucratic practices that troubles business operations and at the same time pushes operating expenses up.
The survey also shows that corruption has undermined the trust that many portions of society place in the civil authority system while holding back development of the society.
Ngo Minh Hung, deputy head of the Anti-Corruption Department under the Government’s Inspectorate, said the country has badly lacked the statistical figures and evidence needed for the assessment of corruption in society in general, and in the business world in particular.
“The information we have from reports only shows ‘the tip of the iceberg’, so it is necessary to conduct sociological inquiries or studies to know what is in “the sunken part of the iceberg’,” Hung said.
According to Nguyen Ngoc Anh, a sociological researcher, nearly 100 percent of businesses in Da Nang said that they carry out business registration procedures, while in a number of other localities the proportion is much lower.
“Half of the number of companies surveyed said they do not complete the procedures, while the other half complained that the procedures were so complicated and distressing that they had to resort to the help of business service providers to save time,” Anh explained.
Thirty percent of companies in Da Nang said that hiring consultants for business registration was one of the ways to save costs, while 60 percent recognized that the registration procedures have been simplified, and are now clearer and less time-consuming.
Meanwhile, 63 percent of businesses in the survey complained that “the business licensing system is so complicated and unclear that is is one of the reasons behind corruption in Vietnam.”
Concerning the granting of certificates for land use rights and other land-related procedures, only 31 percent says these procedures have become convenient for businesses, while half of the respondents complained about the complexity of land allocation, leases or grants, and 40 percent confirm that “close relationships” with officials in charge of land issues will help people get through land procedures more easily.
Various under-the-table money
The survey shows that ‘unofficial’ expenses businesses have paid to agencies in charge of food safety and hygiene, natural resource and environment, social insurance, and standard-metrology- quality was inconsiderable.
Meanwhile, more than 10 percent of businesspeople lamented that the under-the-table money they have had to pay to tax, customs, and market management agencies was remarkable, even huge.
Corruption has also been seen in the relation between businesses and power and water supplying companies, since they are monopoly utilities. More than 8 percent of surveyed companies say they have had to pay extra money, in addition to official payment on invoices, to electricity suppliers; while the rate related to water providers was 4.1 percent.
Although the Government has launched a number of programs to give more capital to businesses, more than 50 percent of the respondents said they could not obtain loans without paying a ‘tip’ to credit officers at banks.
Sixty percent of the surveyed companies said they had to make ‘good relationships’ with banks if they wanted to get a loan.
In the process of goods and/or service procurement for State-owned enterprises, 50 percent of providers said they had to offer ‘gifts’ to officials in charge of bidding so that they could be included in or win the bids.
According to the survey’s organizers, the proportion of under-the-table money, a type of bribe, in the total operating costs at the surveyed companies was not too high, but an alarming issue is that the giving of ‘envelopes’, invitations to regal dinners, or offering tourist tours have become common phenomenon in the relation between businesses and civil authority organs.
Legal loopholes, low salary
As much as 87 percent of surveyed businesses blamed the corruption on legal loopholes that have been exploited by corrupt State officials, while 75 percent said ineffective law enforcement has allowed the spread of corruption.
In many cases, officials personally suggested that businesses pay them a bribe or a gift in return for their assistance in resolving the problems those businesses were facing. This phenomenon is most common in the fields of land, banking, and business registration.
About two-thirds of the respondents said that the low salary regime for civil servants is among the main causes of corruption.
In order to drive back corruption, the survey’s authors proposed that the Government take measures to increase legal income for civil servants, strengthen the education of State employees in morality and lifestyles, and enhance the strictness of punishment for those who commit corrupt acts.
Doan Duy Khuong, vice chairman of the VCCI, said, “There are many reasons for businesses to opt to give bribes to State officials, and when they are doing so, they think about the short time benefits they can gain. However, in the long run, such a practice will undermine their business ability and damage their competitiveness, since they have become much more reliant on bribing than on their capabilities to obtain their goals.”
