A top comrade’s fall underlines divisions in Vietnam
A corruption scandal at PetroVietnam has implicated a once fast-raising Politburo member, leading to the first ever in-term dismissal of a top ranking apparatchik
On April 27, the Central Inspection Committee of the Vietnam Communist Party (VCP) recommended sanctions against Dinh La Thang, the party’s Ho Chi Minh City chief, paving the way for his dismissal at the Central Committee’s 5th Plenum held on Sunday.
It was the first time in five years that a Politburo member was investigated for corruption and the first time ever that one had been removed from their post mid-term, all in an unusually public fashion.
Young, well-educated and technocratic, Thang, 57, seemed like he was being groomed for loftier things. He had previously served as Minister for Transportation and received plaudits for improving Hanoi’s infrastructure. Thang was also widely viewed as a new breed of politician in a one-party system that has long favored rule by faceless committee.
He was arguably the most charismatic member of the leadership who had, ironically, raised the bar for public accountability and was known as a pragmatic problem solver. In January 2916, he was elected to the 19-member Politburo, along with a dozen other newcomers to the powerful decision-making body, and put in charge of the country’s economic engine of Ho Chi Minh City at the 12th Party Congress.
The investigation focused on his tenure at the giant state-owned energy conglomerate, PetroVietnam, which he chaired from 2009-2011. The Central Inspection Committee homed in on several alleged illegal business decisions, including violations involving an investment in OceanBank. The bank’s former chairman and 47 other defendants were tried and convicted in late 2016 for some US$66 million in losses. Thang was also accused vaguely of wrongful “big bidding packages.”
Vietnamese politics are notoriously opaque, with internal purges often reflecting competition for supremacy between personalized party factions. As such, there is always more to high-level corruption allegations, investigations and guilty verdicts, especially of a sitting Politburo member.
On the one hand, the allegations against Thang were not new. Two of Thang’s underlings at PetroVietnam have been investigated in the past two years. Nguyen Xuan Son, Thang’s successor at PetroVietnam, was arrested in 2015 for financial irregularities when he headed OceanBank.
Trinh Xuan Thanh, another Thang ally, fled the country, though investigations into him have brought down several other officials.
Nor are they particularly surprising. Politically connected state-owned enterprises, with access to land, capital, and other inputs, have long been tools for enrichment by the Communist Party elite. The lack of a free press compounds the problem of corruption as state-controlled and tightly censored media are unable to do investigative reporting.
Vietnam ranks among the most corrupt countries in the world by international watchdogs such as Transparency International.
Thang is not the first senior official to be ensnared in high level corruption allegations. Former Prime Minister and Politburo member Nguyen Tan Dung was almost forced from office due to his role in the US$4 billion scandal involving the state-owned shipping conglomerate Vinashin.
That scandal involved much bigger losses and leakages. In February this year two former executives were given death sentences and another life in prison for their roles in alleged corrupt practices.
Dung, a two-term premier widely viewed as a reformer, survived similar intra-party probes for several reasons. First, he had been at the apex of power for much longer. He joined the Central Committee in 1991, the Politburo in 1996, and served as Prime Minister from 2006 to 2016, a period of exceptional economic progress.
In the context of Vietnam’s patron-client political culture, there were a lot of people who owed their careers to Dung; he had a deep reservoir of party loyalists. More importantly, he had party elders on side that protected him, as they likely viewed his downfall would jeopardize the pace and scope of badly needed economic reforms.
None of this is true with the more junior Thang in a system that rewards seniority. Thang may have been near the top, but he clearly had not been there long enough. More significantly, Thang could be purged and it would have no bearing on the future of the country’s economic reforms or international perceptions of its direction.
The VCP has made clear that nothing threatens its legitimacy more than corruption. But unless the VCP is willing to free up the media as a check and balance, which it clearly is not, then leaders must demonstrate that even the most powerful are not immune to repercussions.
In the run up to the 5th Plenum, party chief Nguyen Phu Trong ordered the CIC to establish eight task forces “to oversee the handling, investigation and trial of major corruption cases across the country.”
At the time of writing, it appeared that Politburo member Trong Thi Phong, the deputy chairwoman of the National Assembly, would become the next Party Chief of Ho Chi Minh City. But the timing of the recommendation against Thang suggests that there is more to the story.
The 12th Party Congress left many power struggles unresolved. Most importantly, neither main VCP faction garnered sufficient support for their candidate to become the next all-powerful general secretary. Reformers, for the most part, backed then premier Dung. But not all were on board due to lingering concerns over corruption.
Conservatives, on the other hand, favored the party’s top ideologue and Central Propaganda Department chief Dinh The Huynh, who has raised concerns that the VCP was being sidelined from decision-making by government technocrats as the economy has expanded and become more firmly integrated with the world.
A stalemate ensued and the incumbent, Nguyen Phu Trong, 73, received a second age waiver and stayed in place. Although not explicitly stated, it was widely expected that he would retire at a midterm Party Congress, scheduled for May 2017. Now, with party divisions still apparent, it appears that Trong will stay on even longer.
To be sure, even without the investigation into Thang, the reformist faction enters the midterm meeting in a weakened position.
Widely credited with improving relations with the US, the Trump administration’s withdrawal from the Trans-Pacific Partnership (TPP) and its apparent hold on Freedom of Navigation Operations in the South China Sea to win Chinese assistance in dealing with North Korea has put the faction on a back foot.
President Tran Dai Quang, the former Minister of Public Security, was in a very strong position to become the next General Secretary at the 13th Congress in 2020. But Thang was viewed as one of his key allies, and it is not clear yet how his demise will impact on Quang’s political future and his faction’s standing in the intra-party competition for power and influence.
Zachary Abuza is a Professor at the National War College in Washington DC, where he specializes in Southeast Asia security and politics. The views expressed here are his own.