Corruption and the New Year
Anyone who has done business in Cambodia and Vietnam knows the lunar New Year holiday tradition: a trusted staff member assembles a list of officials that have quietly (or not so quietly) asked for or demanded money. It can be extortion (“Pay me $150 per month next year and I won’t repeal your license.”), an outright bribe (“We have so many work visa applications that it can take months to process yours. But if we have a relationship, maybe we can get it done more quickly for you.”), or preventative (“The police say we can’t park motorbikes in front of the cafe, even though every other business does it. If we give them money, they won’t drive by our street.”). Much management time is spent balancing culturally appropriateness, international corruption laws, and the possibility that a nefarious official might illegally shut down your business.
The bottom line is that these countries have too much ambiguity with regulations and enforcement. This comes to a front during the New Year holiday, since there is a tradition of exchanging gifts. However, some companies are quick to hand out lofty bribes, driving increased demand and expectations from local authorities.
My take is that change will only come from within, but international businesses can set the tone within their organizations by encouraging transparency, accountability and integrity.
Jim Anderson’s article in the Thanh Nien Newspaper and the latest World Bank Corruption Report on Vietnam provides an in-depth look at this practice from the perspective of international businesses and Vietnamese citizens.