Saturday, November 04, 2006

Vietnam Communist Party Holds 10th Congress

Vietnam Communist Party Holds 10th Congress

By Michael Karadjis

A wide-ranging public discussion in the lead-up to the 10th National Congress of the Communist Party of Vietnam (CPV) focused on issues of corruption, calls for greater democracy and accountability, and whether to allow CPV members to take part in capitalist business.

As is usual practice, the main reports were released several months early to allow for public input. Tens of thousands of comments flooded in form around the country, aired nightly on television, printed daily in newspapers and posted on various web discussion sites. Western media hyped this as ‘unprecedented’, yet the atmosphere in the lead-up to the previous 9th Congress was remarkably similar.

The question of allowing CPV members to engage in capitalist business and allowing capitalists to join the party was a major issue in the discussion. The principle that the CPV could include people who carried out some form of business had previously been clarified at the 5th Plenum in 2003.

This was logical, particularly in an underdeveloped country like Vietnam, where the petty ‘household business’ sector consists of many millions of people who cannot be classified as workers or peasants.

However, there were two major issues of confusion. Firstly, the party statutes said that if members employed anyone, they could not engage in “exploitation.” Yet while the owner of a small workshop employing a few people was hardly a capitalist, the Marxist concept of “exploitation” is not simply a reference to appalling treatment of workers by big business; rather it objectively describes the relationship involved in private waged employment in a market economy.

The second problem was the unstated assumption that “business” referred to small business. The 12th Plenum of the CPV Central Committee last year passed an amendment to add the words “without limitation in scale”.

Voices were raised both in favour and against. Nguyen Duc Binh, former rector of the National Political Academy, wrote that if Communist Party members can become capitalists, the party should change its name. The capitalist class plays its role in the country’s development, but the role of the CPV is to represent working people.

Others said party members should have this right because the law doesn’t restrict business scale. The private sector is recognised as having a role in the current phase of development of the productive forces “in transition to socialism,” but it creates uncertainty if they are seen to have less rights.

By allowing capitalists to be members, it gives the party greater control over them, they argued. Party membership could help orient them to make greater contributions to poverty reduction and set standards for good payment and benefits for workers.

A more radical argument was put by Hong Ha from the CPV’s Theoretical Council that “it is a big waste not to make full use of party members’ knowledge and capital” by allowing them to develop the economy as capitalists.

Some 10 percent of CPV members are industrial workers and 30-40 percent are farmers, the majority of the population. Others include intellectuals, professionals and officials. Those in favour of the change claimed few capitalists would join, claiming that in China only 1.5 percent of Communist Party members are capitalists.

China officially admitted large capitalists into its CP in 2001, and adopted a new statute that the CP represents the “advanced productive forces, advanced culture and the entire nation,” where the ‘advanced productive forces” are widely understood to mean the capitalist class.

The CPV has yet to release the final document as amended by the Congress. However, indications are that the final outcome may have been much tamer than in the draft put to the Congress by the outgoing CC.

On the one had, the words “must not engage in exploitation,” when employing people, were removed, as they were a logical contradiction. Instead, the words “where there will be no exploitation of human by human” was added to the definition of the CPV’s socialist goal.

On the other hand, the draft amendment to Congress had read:

Party members engaged in the private economy without restriction on scale, apart from strictly observing Party statutes, the law and government policies, must also follow a number of defined regulations and conditions

In the only passing reference I’ve yet seen since the Congress, the words “without restriction on scale” were omitted; however, it is unclear whether this means they were dropped or merely omitted in that media article.

Other themes revolved around corruption and greater accountability of party and state leaders. These themes were highlighted by the busting of an enormous corruption scandal just weeks before the congress.

This involved leading officials in the Transport Ministry siphoning off 7 million dollars from the PMU18 unit, responsible for utilizing foreign loans for major infrastructure works. The director of the unit, Bui Tien Dung, was caught gambling 2 million dollars on football. Dung and the deputy Transport minister, Nguyen Viet Tien, have been arrested, and the Minister Dao Dinh Binh resigned.

Veteran leaders, including national hero General Vo Nguyen Giap, General Chu Huy Man, and the previous CPV general secretary, Lieutenant-General Le Kha Phieu, petitioned the police demanding a full investigation even if it led to the highest levels.

Giap said such scandals have “frozen the leading role of the Party and the management of the State and the supervision of the people." Phieu called for a new ‘Doi Moi’ (Renovation) of democracy similar to the economic Doi Moi Vietnam has carried out over the past 20 years.

Regarding the thousands of comments that flooded in from the public, it was significant that “most of the comments involved ways to improve the party's leadership, rather than challenging its primacy or demanding a multiparty system,” said Carlyle Thayer, a Vietnam expert at the Australian Defense Force Academy in Canberra.
The media played a prominent role in keeping the heat on the scandal. Western media reports also saw this as “unprecedented,” yet the media have been playing this role for many years now, since Phieu demanded the scalps of “giant rats not little mice” back in 1999, bringing down the deputy prime minister in a land scandal.

As Margot Cohen reported in the Far East Economic Review of January 25, 2001,
in relation to an embezzlement scandal involving funding designed for ethnic minorities, “it points to the increasing boldness of the Vietnamese press and the national assembly in demanding public accountability. Local newspapers began uncovering irregularities three years ago. As the investigation stretched into 2000, the press became more aggressive.”

Like at the 9th Congress, leaders again were frank that corruption and ethical degradation have taken hold of “not a small part” of the party membership and leadership and are a mortal threat to the party. What the new measures announced will achieve remains to be seen. The sincerity of current party general-secretary, Nong Duc Manh, is evident, and a great many corruption cases have been pulled down over the last few years. The problem is that they also keep coming up.

''I don't see corruption here running totally out of control,'' said Martin Gainsborough, a Vietnam specialist from Bristol University. ''Yes, corruption is endemic. But it is not as endemic as in some other places.'' This is certainly true. Yet there is also the sense that many Vietnamese are exasperated with many of their own leaders, regardless of the situation elsewhere.

The greater political openness and checks from below that have been evolving need to be strengthened. However, corruption is not only about ‘bad people’ who need ‘good governance’, but is caused by the kind of incentives inherent in a market economy, with growing commercialisation and rising inequality, both within the country and as part of its “integration” into the global capitalist economy.

These trends are facts of life for a small socialist-oriented country surrounded by world capitalism. However, whether the process leads to socialism, or back to capitalism via corrupt primitive accumulation, depends on the party defeating this cancer.

Party resolutions reaffirmed that, in the “socialist-oriented market economy,” the state-owned economy plays the “leading role.” However, they also state that the process of converting state companies in areas “where the state does not need to keep 100 percent” into share companies – known as ‘equitisation’ – will be stepped up.

Whether this increases the state’s leadership in the economy, or increases the power of private shareholders over the state, remains to be seen. A recent report claims Vietnam will equitise 1700 of the remaining 2700 state enterprises by 2010. However, figures are deceptive: the 2500 state enterprises equitised to date represent half the original total number of SOEs, but account for only 10 percent of state enterprise capital; the 1000 that would still remain in full state hands are the most strategic firms in key areas. However, a number of larger corporations are scheduled for the coming period, including Vietcombank, one of the leading state banks.

In addition, proceeds from equitising smaller state companies may be ploughed back into the more important ones, increasing state investment. The Financial Times noted “Vietnam's maiden sovereign bond in October raised Dollars 750m”, but complained that “Vietnam’s leaders are pouring resources into state companies such as Vinashin, the shipbuilder, which was granted the entire proceeds of the bond.”

Vietnam has maintained the fastest economic growth in south east Asia since 1998, and reduced poverty from 58 percent in 1993 to 22 percent in 2005, a record achievement. Its health and education indicators are equivalent to those of middle income countries, despite remaining a low income country with some $US 500 GDP per capita. These are the achievements of a mixed economy, utilizing the mostly small-scale private sector and foreign investment under the leadership of a dominant state-owned economy.

Those advocating it go all the way with the market and capitalism ought to look around at the misery of the capitalist third world. Ironically, to amass the private capital necessary for a large-scale capitalist class, it would be necessary to harness the loot of the corrupt. The PMU18 officials embezzled money by awarding public-works contracts to private firms owned by family and friends. While the new regulation on party members partly aims at corruption by making such business ownership more transparent, the question is whether it may have the opposite effect of encouraging its spirit.

The Congress was held between April 18 and 25, attended by 1,176 delegates representing 3.1 million members, of whom 750,000 joined in the last five years. The Congress voted for 160 full and 21 alternate Central Committee members from lists of 207 and 46 nominated or self-nominated candidates. There was some 50 percent turnover on the central Committee, and eight of fourteen members of the Politburo are new. "A young leadership is in place and it cements the process of accelerated reforms," said Thayer.
Manh, widely seen as a consensus-maker between different tendencies, kept the post of CPV general secretary, despite a challenge from Nguyen Minh Triet, the party chief in Ho Chi Minh City. Triet looks likely to replace the president, Tran Duc Luong, while another southerner, Nguyen Tan Dung, is being groomed to replace prime minister Phan Van Khai, and Luong, Khai and the head of the National Assembly, Nguyen Van An, were dropped from the Politburo due to age.

(This is an extended version of an article first appearing in Green Left Weekly May 15, 2006, at

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