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JAPAN RESUMES ODA TO VIETNAM


On Tuesday, March 31st, Japan signed an agreement to resume official development assistance to Vietnam for 2009 following a suspension due to a corruption scandal involving a Japanese company.


On Tuesday, March 31st, Japan signed an agreement to resume official development assistance to Vietnam for 2009 following a suspension due to a corruption scandal involving a Japanese company.

Japan, one of the largest ODA donors to Vietnam, announced in December it had suspended new aid for 2009, citing a corruption scandal. In a Japanese court last year, former executives of Tokyo-based Pacific Consultants International (PCI) admitted paying kickbacks to a Vietnamese official overseeing a Japan-funded road project.

The head of the project, the East-West Highway in Ho Chi Minh City, allegedly received at least $800,000 in bribes from executives of the PCI.

Last week a Tokyo court handed a suspended jail term to Masayoshi Taga, former president of PCI, who was convicted of giving $220,000 in bribes to a Vietnamese official in charge of a highway project in Ho Chi Minh City. In January, the court imposed a fine of 70 million yen on the company and sentenced three other former executives to suspended prison terms.

Tokyo announced in February that the yen loans would resume after it said Vietnamese officials gave assurances that steps would be taken to prevent similar abuses. The Vietnamese government said the two governments had set up a joint committee to combat corruption following the incident.

The agreement was signed in Hanoi between Japanese Ambassador to Vietnam Sakaba Matsuo and Vietnam’s Minister of Planning and Investment Vo Hong Phuc. Under the agreement, Japan will provide $900 million of ODA to Vietnam this year for four major infrastructure projects: an urban transit railway, water drainage, road improvement in Hanoi, and an environmental improvement program in Haiphong.

At the signing ceremony, Phuc called the kickback case involving PCI “a little dot in the very great picture” of Japanese assistance to Vietnam. He expressed hope that aid from Japan, already Vietnam’s biggest bilateral donor, would increase, and added that “we commit to use this very effectively.”

Sakaba cited efforts by Vietnam to improve the legal environment and increase measures to strengthen management and effective use of ODA projects, “including that on fighting corruption.” Tsuno Motonori, chief representative of the Japan International Cooperation Agency in Vietnam, told AFP that Japan will closely monitor how Vietnam implements the measures.

Nguyen Xuan Tien, Deputy Director of the Ministry of Planning and Investment’s Department of Foreign Economic Relations, said, “These loans are very significant for Vietnam’s economy, not just in the short term by creating jobs, but for long-term economic growth, because they focus on infrastructure.”

Source: www.AsiaEcon.org
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Source: www.asiaecon.org |


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