Bumps on the road to prosperity


Vietnam faces surging demand for property but legal and financial shortcomings deter investors and consumers


The fast-growing economy of Vietnam has opened tremendous opportunities for real estate investment but there are some challenging factors that overseas investors need to consider before jumping on the bandwagon.

Mr Quang said that amid the property boom, some challenges awaited including legal matters, land title problems, speculation, planning and investment procedures.

He said the legal framework had some limitations such as the legacy of the Communist central-planning system, spontaneous and ad-hoc state intervention, dual ownership of land and housing units, and overlapping responsibilities for land use title supervision and planning.

“Access to land-use rights is complicated, such as long-term use and leases on land,” he said.

In Vietnam, people cannot own a land plot but the government can grant them land-use rights. Five types of rights are available: right to transfer, mortgage, inherit, rent and transform land.

Mr Quang said the land-title situation was especially chaotic in urban areas because of unclear administrative responsibilities. People also had limitations in terms of access to formal land and housing.

As well, land information and records are not adequate while land registration and formalisation procedures are complicated. The government’s planning system is also rigid and the cost of land transfers is quite high.

Another challenge involves differences in pricing that distort the property market. Land value is determined by administrative measures rather than based on the market while land allocation through bidding is limited.

“We lack a market-based and independent valuation organisation,” he said. “The booming real estate market has built a lot of real estate brokers but few of them are professional.”

Mr Quang said the planning system was inefficient and ineffective as there was a lack of priority-setting. Little co-ordination exists among mechanisms related to socioeconomic planning, spatial planning, land use and sector planning.

“The government should allow public consultation and participation in plan preparation and implementation,” he said.

Constraints exist as well on investment procedures and land allocation. They are unclear and complicated while some regulations overlap.

Project and programme assessment and monitoring also need more appropriate mechanisms.

Other challenges include weakness of business capacity and professionalism, limited capital investment, a lack of market research and strategies, constraints on mortgages and access to financial markets, limited savings mobilisation for the formal real estate market, widespread speculation, inefficient land use and corruption and mismanagement.


Vietnam Continues Crackdown on Dissidents


Vietnam is detaining four democracy advocates who are Vietnamese-born foreign citizens – two Americans, a French woman and a Thai. Authorities are refusing to let them speak with their embassies. Matt Steinglass has more from Hanoi.

The journalists’ organization Reporters Without Borders is calling on French President Nicolas Sarkozy to demand that Vietnam free Vietnamese-born French citizen Le Thi Thanh Van. Van is a journalist and democracy activist, and was one of six people arrested November 17 in Ho Chi Minh City.

Vincent Brossel, the head of Reporters Without Borders’ Asia desk, says Vietnam’s refusal to let French diplomats meet with Van is shocking, considering France’s strong relationship with Vietnam.

“Despite these good relations, the French authorities were not able to visit a French citizen. I mean, it’s not because she has a Vietnamese name that she has less rights than Mister Martin or Mister Dupont,” he said.

Van’s lawyer, Serge Lewisch, says refusing her access to consular officials violates her rights under international law.

Lewisch characterized as “stupid” a statement last week by the Vietnamese government that Van and other activists were involved in terrorism.

Two Vietnamese-Americans were arrested with Van – Quoc Quan Nguyen and Leon Trung. The U.S. Embassy says it cannot comment on their cases because it, too, has been prevented from meeting them.

The arrests are part of a yearlong crackdown on democracy activists in Vietnam, which followed a small surge of independent political activity in 2006.

Some of that activism has been by Vietnamese who live abroad or have foreign citizenship, like Van, Nguyen, Trung, and Thai citizen Somsak Khunmi.

All four are members of a U.S.-based anti-Communist group called the Viet Tan party. In the early 1980s, the Viet Tan organized armed raids into Vietnam.

But a Vietnamese-American spokesman for the Viet Tan Party says that has changed.

Duy Hoang says Viet Tan now wants to bring democracy to Vietnam through peaceful means. He says the Viet Tan activists who were arrested were discussing nonviolent movements, like the Orange Revolution in Ukraine.

Hoang says 7,000 leaflets found in the group’s possession are explicitly nonviolent, though the Vietnamese government says the leaflets are evidence the four are “terrorists.”

But most of the democracy activists jailed in Vietnam are Vietnamese citizens. Earlier this week, two of the most prominent ones had their appeals rejected by a Vietnamese court.

Le Thi Cong Nhan, left, speaks during a trial at the Appeal Court of Vietnam People's Supreme Court in Hanoi, 27 Nov 2007, as Nguyen Van Dai, second from right, looks on
Le Thi Cong Nhan, left, speaks during a trial at the Appeal Court of Vietnam People’s Supreme Court in Hanoi, 27 Nov 2007, as Nguyen Van Dai, second from right, looks on

Human rights lawyers Nguyen Van Dai and Le Thi Cong Nhan were convicted in April of “spreading propaganda against the state.”

The appeals court reduced their sentences to four and three years, respectively.

Western governments and human rights organizations have denounced the sentences. So has Dai’s wife.

Vu Minh Khanh says the trial was neither fair nor open. She says her husband is a political prisoner who has committed no crimes, and that the Vietnamese law under which he was convicted, known as Article 88, is unconstitutional.

One member of Dai and Nhan’s activist group who has not been arrested is Bach Ngoc Duong, an engineer who worked with Dai on an independent newsletter in 2006. When Dai was arrested, Duong fled Vietnam for a country he prefers not to name.

Duong says the arrests have created great difficulties for Vietnam’s democracy movement. He compares the government’s actions to the recent crackdown in Burma.

On Friday, the European Union’s office in Hanoi called on Vietnam to release Dai and Nhan, as well as all other “non-violent political activists”.

The U.S. also is calling for Dai and Nhan to be released.

But such moves have so far had little effect on a Vietnamese government determined to discourage its citizens from advocating alternatives to single-party rule.