Corruption will constrain Vietnam's development

Subject

Corruption in Vietnam.

Significance

Corruption claims will probably spike in early 2016, as heightened political manoeuvring before and after the Communist Party of Vietnam's (CPV) congress, January 20-28, sees rivals clash. Beyond the congress, however, corruption will become increasingly important as Vietnam's government seeks further foreign investment and pushes national economic development.

Impacts

• Vietnamese public and private sector corruption will cause economic distortions, for instance through resource misallocation.
• Illicit fund flows and business practices stemming from corruption will undermine legitimate businesses.
• Foreign donors and investors face reputational risks at home and abroad if implicated in local Vietnamese corruption.