Vietnam Needs to Combat Industrial Pollutions says World Bank

June 30, 2008Industrialization is taking its toll on Vietnam’s environment and more funds should be dedicated to fighting pollution, the World Bank said in a study published on June 27. Between 1990 and 2005 Vietnam achieved an average annual growth rate of 7.5% in gross domestic product, driven largely by the industrial sector, but little was being done to protect the environment, the study said.

“There is a growing pressure on the government to raise public expenditure on pollution control and to force business to do the same,” the study said. “The cost to the economy of pollution, which is increasing in volume and toxicity, are becoming evident to the government and the public at large.”

Funds dedicated to fighting pollution gradually grew from 2000 to 2005, when it reached $600 million , But the bank said Vietnam needed about $2.5 billion  to adequately address the problem.

Five provinces or big cities, including the financial hub Ho Chi Minh City and capital Hanoi, are home to 63%  of manufacturing jobs and nearly 55% of the country’s industrial firms. “Industrial pollution is highly concentrated in certain areas of the country, and originates from a few manufacturing subsectors,” the study said.The manufacturing of chemical products and shoes were among the top polluters in the country, the bank said.

Copyright Agence France-Presse, 2008


PCI ‘bribed’ Vietnamese official

A manager of a Vietnamese organization that oversaw a multibillion yen highway construction project in Ho Chi Minh City received bribes allegedly paid by Pacific Consultants International to secure the contract for the project, which was funded with Japanese official development assistance, a PCI source said.

It also has been learned that PCI allegedly paid bribes on at least two occasions–once in 2003 and once in 2006–reportedly instructed to do so by the headquarters of the major consultancy firm.

“Headquarters ordered us to give money as remuneration for receiving the order,” a former PCI executive reportedly told the special investigation squad at the Tokyo District Public Prosecutors Office.

Investigators are looking into whether PCI violated the Unfair Competition Prevention Law by bribing an overseas public official.

PCI received about 1.1 billion yen in fiscal 2001 for consultancy work on a project to build a highway traversing Ho Chi Minh City from east to west. In fiscal 2003, a consortium that included PCI and other firms won a contract worth about 2 billion yen. Both were for ODA works funded with yen loans.

According to the PCI source, a manager of PMU–the organization managing the highway construction project–received the alleged bribes.

PMU is a management organization established by the Ho Chi Minh City People’s Committee–an administrative organization similar to a city office in Japan. It is responsible for overseeing infrastructural improvements such as roadworks and waterworks.

The cross-city highway was a massive project that involved tunneling under the Saigon River in the city. The total project cost was about 80 billion yen.

The alleged bribes were paid in spring 2003, immediately after the consortium received the order for consultancy work, and again in 2006. Both payments were in U.S. dollars, reportedly amounting to a sum equivalent to several tens of millions of yen.

“Both the payments were ordered by the headquarters,” a former PCI executive is said to have told investigators during questioning. The executive also reportedly said the funding in 2003 was “remuneration to get the order.”

The executive later worked as the head of an affiliated company in Hong Kong that was allegedly used by PCI as part of a tax evasion scam. PCI sent money to that company to help win contracts for ODA projects in southeast Asia.

Investigators plan to cooperate with judicial authorities in Vietnam to investigate the alleged shady funding.