Vietnam’s restrictions threaten progress: donors

Vietnamese Catholics hold a vigil outside a court in Hanoi

HANOI — Vietnam’s restrictions on the news media and Internet sites such as Facebook threaten the country’s rapid economic progress, Western donors told an annual meeting of World Bank and other officials on Thursday.

“Economic growth and development requires an open and transparent environment for all stakeholders, Vietnamese and international,” US ambassador Michael Michalak told the opening session of talks between Vietnam and its aid-givers, known as the Consultative Group.

There has been a “shrinking of the space for honest, reliable information” recently, Michalak told the two-day meeting where pledges of aid are announced.

Michalak and the Swedish ambassador, Rolf Bergman, both expressed concern about recent reports that the world’s most popular online social networking site, Facebook, is being restricted.

“This is not about teenagers chatting online. It is a question of people’s rights to communicate with one another, share ideas and to do business,” Michalak said.

An Internet provider said last month that Vietnam’s public security ministry had ordered blockage of the site which, like other online platforms, offers room for expression not permitted in traditional media which are all linked to the communist state.

The Minister of Information and Communication, Le Doan Hop, last month indicated to legislators that he wanted to reinforce control of the Internet. He said “toxic and bad-intentioned information” has sometimes circulated in cyberspace.
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Donors say Vietnam should respect rights

HANOI (Reuters) – Aid donors urged Vietnam on Thursday to unleash the press to help fight corruption and to respect international human rights norms, or risk negatively impacting investment and aid flows.

“Vietnam’s economic performance and its international reputation are compromised by restrictions placed by the government on the personal freedoms of its citizens,” a statement by the U.S. delegation to an annual donor summit in Hanoi said.

Vietnam’s ruling Communist Party brooks no opposition, and in the past year has detained or jailed several reporters, bloggers, lawyers and dissidents, and deployed an administrative decree to bring down the country’s only independent policy think-tank.

The party recognises widespread corruption as a major impediment to development, but restricts the media’s ability to ferret out cases.

The United Nations said governments must “own” the battle against corruption, but others would make it more effective.

“Broadening the scope for collaboration and involvement of non-State actors such as the media, mass organisations and individuals makes anti-corruption efforts more effective,” it said in its report to the meeting, called the Consultative Group.

Sweden, as president of the European Union, went further.

“The government of Vietnam has to allow media to scrutinise the power,” it said.

“Researchers, journalists and lawyers have to be encouraged to raise their voices to be able to contribute to the future of Vietnam. They should not be silenced or discouraged. Recently, however, worrying signs seem to indicate that the development is going in the wrong direction.” U.S. Ambassador Michael Michalak also noted in prepared remarks that recent events “have contributed to a shrinking of the space for honest, reliable information”.

“Access to reliable, objective information; the ability to conduct research freely and publish one’s findings; the right to articulate and consider differing views — are absolutely essential to technical innovation and economic prosperity.”

(Reporting by John Ruwitch; Editing by Sanjeev Miglani)

http://in.reuters.com/article/worldNews/idINIndia-44430120091203?sp=true

Vietnam starts unwinding stimulus

By Tim Johnston in Bangkok

Published: December 2 2009 16:37 | Last updated: December 2 2009 16:37

Vietnam plans to stop its interest rate subsidy scheme at the end of the year, becoming the first Asian nation to start unwinding its post-crisis stimulus programme, the government announced on Wednesday.

Analysts expect Vietnam’s gross domestic product to grow about 5 per cent this year in contrast to many of its neighbours, which are expected to see their economies shrink.

The government’s stimulus programme – which was touted at $8bn (€5.3bn, £4.8bn) but has actually cost nearer $4bn, or 4.3 per cent of GDP, according to the World Bank – has contributed significantly to growth. Its scheme of subsidising commercial loans by 4 percentage points met with particular success but will now finish at the end of the year, as planned, in spite of commercial pressure to keep it open until March.

“The termination of the program is in line with the interest-rate policy and the market stabilisation and will help businesses to increase their competitiveness,” Nguyen Dong Tien, the deputy governor of the State Bank of Vietnam, said in a statement.

The Vietnamese economy is heavily dependent on exports, which fell more than 14 per cent in dollar terms in the first eight months of the year. But the government bet their limited resources on a stimulus programme which concentrated on supporting industry to keep people in work, putting the country in a strong position to make the best of any upturn.

“This is a country that went the China route without China’s resources,” said Martin Rama, the chief economist for the World Bank in Vietnam.

The gamble seems to have paid off, with exports up last month 19 per cent year on year, industrial production rising 16.4 per cent; and retail sales up 30 per cent.

However, Mr Rama says the scaling back of the stimulus is timely.

“The interest rate subsidy scheme was very instrumental in the early days of the crisis,” he said but added that once the working capital requirements had been fulfilled, the take up-on loans had declined substantially and many of the companies that were latterly availing themselves of the facility were using the loans to buy dollars and gold, putting downward pressure on the dong, the Vietnamese currency.

“It is going to be painful for some but the government are counting on that to make borrowers sell gold and dollars to pay the loans back,” said Mr Rama.

Vietnam hit the headlines last week with a 5.4 per cent devaluation of the dong and a 1 percentage point rise in the reference rate, moves that were made to address specific pressures on the currency. The country has generally come through the crisis much better than many analysts expected and by some measures is showing the world’s fastest growth.

http://www.ft.com/cms/s/0/cb3a2922-df26-11de-be8e-00144feab49a.html

World Bank reassured by Vietnam steps toward stability

HANOI, Dec 3 (Reuters) – It is “reassuring” to see Vietnam rebalancing its economic policy toward stability, but more turbulence could be on the cards as the global economy continues to recover, the World Bank said on Thursday.

Even as monetary policy tightens, inflation is likely to see some acceleration in Vietnam in 2010, it said in a semi-annual report.

“It is reassuring to see that the government is rebalancing its objectives once again, giving more priority to stability. The decisions made between late October and early December amount to an appropriate macroeconomic framework being put in place,” it said.

Vietnam’s macroeconomic management for the past two years has so far been effective, despite having a relatively “heterodox and at times rudimentary nature”, the Bank said in its report, entitled “Taking Stock”.

Vietnam had taken a series of small steps starting in October to begin to tighten monetary policy, capped by last week’s currency devaluation and interest rate hike. The government also announced this week an end to subsidies on short-term business loans, which has been a pillar of its stimulus package.

The moves were designed to address imbalances that emerged during roughly a year of expansionary monetary and fiscal policy to counter the global economic crisis, including chronic currency weakness spurred by dollar hoarding and expectations of depreciation. (Reporting by John Ruwitch; Editing by Muralikumar Anantharaman) ((john.ruwitch@thomsonreuters.com; +84 4 3825 9623; Reuters Messaging: john.ruwitch.reuters.com@reuters.net)) ((If you have a query or comment on this story, send an email to news.feedback.asia@thomsonreuters.com))

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