Sustainability or exploitation
Last December, the five-nation
Mekong River Commission agreed to delay the Xayaburi dam project on the lower
Mekong River in Laos pending further study, with Vietnam playing a major role
in the decision.
It was a rare victory for the
environment in Vietnam, however. At a national level, the country remains far
from implementing the environmental laws and regulations necessary to guarantee
the government’s stated goal of sustainable development. In fact, the Xayaburi opposition
appears to critics to be an anomaly. In recent years, not only Mekong projects
have raised criticism, but also many others that Vietnamese authorities have
planned, including the Son La dam project in Northwest Vietnam, whose
construction has already forced the relocation of 100,000 people--mostly from
ethnic minority groups.
“Vietnam needs energy to
support its economic growth” is the refrain. With economic and industrial
growth second only to China, Vietnam’s economic targets are linked to significant
increases in air pollution and environmental problems.
According to data published by
the UN, Vietnamese greenhouse gas emissions in 2007 were 111.38 million metric
tons of CO2, an increase of 420.3 percent since 1990. This raises a number of
interconnected problems. First, foreign direct investment is not yet regulated
in accordance with rules aimed at sustainable growth, and thus risks
undermining the country’s future.
In many cases, Foreign Invested
Enterprises are guilty of using equipment and machines that cause environmental
pollution, or continue to defy business ethics and sometimes even violate the
law. Second, Vietnamese environmental laws lack real enforcement, according to
ministry officials and local media.
With gross domestic product
(GDP) per capita at $1,160 in 2010, Vietnam is now in the group of low
medium-income nations. Even in the midst of the global economic crisis, GDP
continued to grow at 6.2 percent in 2008, at 5.3 percent in 2009 and at 6.78
percent in 2010. These numbers clearly show the results in which FDI, together
with domestic investment, contributes an important part. By the mid 1990s, FDI
into Vietnam was over US$2 billion per year. Due to regional economic crises,
the flow then decreased, only to surge once again in 2006 when Vietnam was
admitted into the World Trade Organization, reaching an estimated US$10-11
billion in 2010.
Apart from the positive
results, however, FDI has focused on short to medium-term targets and the large
number of projects in real estate and the hospitality and mining industries
confirms this. By contrast, few can be considered long-term investment projects
in sectors such as technology, environment, renewable energy or training.
Tran Dinh Thien, director of
the Vietnam Institute of Economics, estimates that on average, the capital of
FDI projects in the hospitality sector is US$160 million, in real-estate US$150
million, and in the mining industry US$79 million.
Vietnam's ability to attract
outside capital and foreign companies' tendency to skirt the rules have
contributed to stellar economic results and to a poverty reduction trend
welcomed also by international organizations. But at what cost? The young do
not receive adequate training, with the country still lacking a highly-skilled
workforce that can compete with those of other countries.
“It seems that foreign
investors come to Vietnam to set up production bases because they want to
exploit the cheap and large labor force in the country,” a Vietnam Business
News article complained in November 2010.
But more serious is the
environmental impact in a region that is experiencing the effects of climate
change. In the medium to long term, the cost of environmental rehabilitation,
adaptation and mitigation may exceed the income derived from mining, tourism and
the export of low-cost commodities.
The law on environment
protection was promulgated in 2005, but as reported on the web site of the
Ministry of Natural Resources and Environment, “only in December 2010, the
decree on specifying damages was promulgated.” Although the 1999 Criminal Code
included a chapter stipulating 10 counts of environmental crimes, “until 2009,
the competent agencies still had not released any legal document guiding the
investigation and judgment of the criminals.”
Amendments to some provisions
of the 1999 criminal code took effect on Jan.1, 2010. But “Meanwhile, the legal
document guiding the investigation, prosecution and judgment of environmental
criminals has not come out yet,” The ministry said
By the end of 2010, environment
police had detected more than 11,000 violations over the previous four years
including discharging polluted wastewater, smoke and hazardous solid waste into
the environment without treatment.
The Bay Ha Long Company Ltd in
the Hiep Phuoc commune of the Nhon Trach district in Dong Nai province, is just
one example. The enterprise “received money every month to treat waste, but it
never treats waste, and just dumped rubbish at refuse tips,” the environment
ministry reported.
More recently, in late November,
two companies in the southeastern province of Dong Nai, AB Mauri Ltd. Co and
Kim Phong Commercial Production Investment JSC, were suspended for polluting
the environment. The cases bring back memories of Vedan, a Taiwanese-invested
monosodium glutamate maker caught discharging untreated effluent through secret
underground pipes into a local river for at least 14 years. The company was
fined 267 million dong (US$13,000), and was asked to pay 127 billion dong ($6.3
million) in order to compensate communities polluted by its operations.
The Vedan case exemplifies
Vietnam’s main two problems: lack of rule implementation at national and local
levels and a lack of ethics on the part of foreign companies, as always ready
to exploit the situation.
“Actually we decide to invest
in countries like Vietnam just because of this lack of rules and the ambiguity
of clear procedures. We do in developing countries what is no longer permitted
in ours,” a western entrepreneur who asked for anonymity told Asia Sentinel.
This behavior also relates to
trade. According to the environment ministry: “From 2003 to September 2010,
more than 3,000 containers of waste docked at Vietnamese ports which were found
unable to meet the requirements to be imported,” containing dioxin and outdated
equipment used in the 1960s.
Last but not least, a
government announcement that Vietnam will establish a legal environment for
green economic development lacks credibility because of the delay in applying
the laws already in place.
Vietnam's location makes it one
of the countries most vulnerable to the impact of climate change. The rise in
sea levels could submerge tens of thousands of hectares of cropland, forcing
thousands of families in coastal areas to relocate and dramatically affecting
the rise in production.
If Vietnam wants to realize a
truly sustainable economic growth, trying to improve its efficiency on
mitigation and adaptation programs, it is crucial that the government review
the entire policy of foreign and domestic investment and force private
companies doing business locally to invest in renewable energy, training and
technology, rather than on large resorts with golf courses.
It would be encouraging if
Vietnam acted firmly, forcing foreign governments and companies to support
decisions based on sustainable economic and industrial growth, a path with
substantial room for improvement and development.
Looking at the internal debate
among ministerial agencies and a growing public awareness of environmental
problems, there are signs that the government is slowly forging this approach.
But it is very slowly indeed.
Roberto Tofani
Asia Sentinel
(Roberto Tofani is a freelance
journalist and analyst covering Southeast Asia. He is also the co-founder of
PlanetNext, an association of journalists committed to the concept of
information for change.)
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