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Vietnam Gets Second-Lowest Score on Corruption in New Ranking
By Christopher Swann Jan. 10 (Bloomberg) -- Vietnam, one of the world's fastest- growing economies, is also among the most corrupt nations, according to a new ranking released today. Vietnam placed 40th of 41 countries rated by Global Integrity, a Washington-based non-profit organization that is partly financed by the World Bank. Romania, which joined the European Union last week, is ranked second after the U.S. and ahead of Israel. The findings may raise concern among overseas investors who have flocked to Vietnam to take advantage of the country's rapid economic growth and low labor costs. In 2005, Vietnam attracted $22 of foreign direct investment per person, compared with $55 for China and $5 for India, according to World Bank figures. ``Vietnam may be a huge economic success story, but this report raises some red flags for investors,'' Nathaniel Heller, managing director of Global Integrity, said in an interview. ``Vietnam is still like the Wild West for investors, with great opportunity for profit along with considerable risk.'' Only the Democratic Republic of Congo ranked lower than Vietnam, while Sierra Leone and Liberia scored higher. Among the problems identified by the report are a judicial system that lacks procedures for selecting judges and poor access to official information. It also cited inadequate procedures to punish corruption among civil servants. The findings also suggest that poor government isn't necessarily a hindrance to economic well-being. Growth in the Southeast Asian nation of 127 million people has averaged 7.4 per cent a year over the past decade. It has reduced the poverty rate by half since 1993, from 58 percent, the World Bank says. Perceptions Ranking Global Integrity evaluates nations based on legislation and resources devoted to good governance and anti-corruption measures. A similar ranking by Transparency International, called the Corruptions Perceptions Index, is based on surveys of experts and business leaders. Vietnam fares better in the Transparency International ranking, placing 111th of 163 nations. Romania is in 84th place. The fewer countries in the Global Integrity index were selected to reflect a broad geographic spread and range of incomes. The group says it plans to include more countries if funding is available. Global Integrity praised Romania's success in cleaning up its government. ``Romania's drive shows how much you can do when there is political will, spurred in this case by hopes of EU accession,'' Heller said. ``They now have the rules in place, and the only question is whether they will have the determination to make them stick.'' Most countries ranked by Global Integrity scored poorly on measures of political financing, with few regulating private contributions to political parties, limiting corporate contributions or requiring disclosure of donations. To contact the reporter on this story: Christopher Swann in Washington at cswann1@bloomberg.net
Last Updated:
January 10, 2007 10:00 EST
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