EXECUTIVE SUMMARY
- In Vietnam, the provinces often wield significant influence over the central government, as evidenced by the popular saying “phép vua thua lệ làng”, meaning “The king’s order stops at the village’s gate”.
- This power dynamic has drastically changed since the launch of the anti-corruption campaign. Since 2021, half of the removed members of the Central Committee of the Communist Party of Vietnam (CPV) were provincial leaders, resulting in a decrease in provincial representation in the Committee from 40 per cent to 28 per cent.
- The government has implemented disciplinary measures, rotation policies for officials, and institutional reforms to curb the fragmented power of provinces and shift the balance towards the central authority.
- While these reforms have helped combat widespread abuse of power and corruption by provincial elites, they have also contributed to the already sluggish decision-making process in the provinces, negatively impacting their socio-economic performance.
- Moving forward, Vietnam must strike a balance between its anti-corruption efforts and the need for provincial autonomy, to sustain economic growth at the local level. This balance can be achieved by reducing the number of provincial administrative units and expanding accountability mechanisms from the bottom up.
*Nguyen Khac Giang is Visiting Fellow in the Vietnam Studies Programme at ISEAS – Yusof Ishak Institute. He was previously Research Fellow at the Vietnam Center for Economic and Strategic Studies.
ISEAS Perspective 2024/44, 13 June 2024
INTRODUCTION
In early April 2024, Duong Van Thai, the party secretary of Bac Giang – an industrial province in northern Vietnam – was summoned by the Central Inspection Commission (CIC) for enquiries regarding several publicly auctioned projects in his province. He was brought in for a process known as “câu lưu” (literally meaning “arrest awaiting investigation”).[1] Thai disappeared from the public eye for over a month before being formally arrested in connection with the Thuan An Group scandal, which also implicated former National Assembly Chairman Vuong Dinh Hue.[2] This method of “câu lưu” was typically applied to criminal suspects or pro-democracy activists, making it a shocking event in the Vietnamese political system. Provincial elites in the country were known to have significant autonomy from the central government and were rarely subjected to such treatment.[3] However, since the anti-corruption campaign intensified in 2016, this practice has become increasingly common in affecting provincial leaders. The frequent use of these methods, similar to China’s infamous “shuanggui”,[4] indicates a decrease in provincial power within Vietnamese politics.
This article analyses how central authorities have utilised the anti-corruption campaign to curb local power. It also delves into the implications of these actions for the dynamics of Vietnamese politics, and their wider social and economic effects. The article also argues that maintaining a healthy balance between provincial autonomy and central authority will be a crucial task for Vietnam’s leadership.
THE RISE AND FALL OF VIETNAMESE PROVINCES
Vietnam is a one-party state with a high level of decentralisation, and its provinces often wield significant autonomous power relative to the central government, as encapsulated by the saying “phép vua thua lệ làng” (The king’s order stops at the village gate).[5] Since the CPV’s 6th National Congress that marked the beginning of Vietnam’s Đổi mới era, provincial leaders have consistently made up the largest group in the Party’s Central Committee, the country’s most important decision-making institution.[6] Provincial authorities are also granted a considerable level of autonomy in making economic policies, which has greatly contributed to the country’s economic success in the past four decades.[7] The autonomous power of provincial elites is evident in the relatively stable Central Committee. From 1986 to 2016, only one provincial leader, Ha Trong Hoa – Thanh Hoa Province’s party secretary, was removed from the Committee. This was in 1988.[8] There have also been instances where the Committee vetoed decisions made by the Politburo and the general secretary. These notable cases include the objection of the ill-fated Standing Committee of the Politburo at the 8th Congress, the earlier-than-expected retirement of General Secretary Le Kha Phieu in 2001, and the failure to discipline Prime Minister Nguyen Tan Dung in 2012. At the 12th plenum of the 10th Central Committee in 2010, the Committee also decided not to discipline Huynh Minh Doan, Dong Thap Province’s party secretary, despite the Politburo’s recommendation.[9]
However, the fortune of provincial elites has reversed since 2016, when General Secretary Nguyen Phu Trong defeated his political rival Nguyen Tan Dung and committed to accelerating the anti-corruption campaign. The CPV under Trong has relentlessly sought ways to rein in unchecked provincial power, which was considered a major source of corruption in the regime. The two biggest economic hubs, Hanoi and Ho Chi Minh City, were initially targeted. In 2018, Ho Chi Minh City Party Secretary and Politburo member Dinh La Thang was sentenced to 30 years in prison on corruption charges.[10] In 2020, Hanoi’s Chairman Nguyen Duc Chung was arrested while its party secretary Hoang Trung Hai was disciplined and relieved of his duties.[11]
Trong’s aggressive anti-corruption campaign, known as the “blazing furnace”, did not stop there. Just six months into the 13th Congress in 2021, Binh Duong Party Secretary Tran Van Nam was arrested on corruption charges.[12] Since then, 13 Central Committee members from provinces have been removed from their positions for different reasons, reducing the share of provincial members in the Committee from 40 per cent to 28 per cent.[13]
While the first phase of the anti-corruption campaign (2013 – 2021) concentrated on violations at central institutions, especially state-owned enterprises, the second phase seems to target “backyard companies” – businesses established by family members or cronies of senior politicians to gain exclusive access to business opportunities at the provincial level.[14] This is evident in the network mapping (Figure 1) of four major corruption scandals since 2021: the Viet A test kit scandal, the repatriation flight scandal, the AIC case, and the Phuc Son Group (Hậu “pháo”) case.
Figure 1. Provinces involved in four major corruption scandals since 2021
Source: Author’s compilation.
These major anti-corruption investigations have not only brought down top central politicians, including presidents Nguyen Xuan Phuc and Vo Van Thuong, National Assembly Chairman Vuong Dinh Hue, deputy prime ministers Pham Binh Minh and Vo Duc Dam, but also had a devastating impact on provinces with links to the fallen “tigers”.[15] Therefore, it is no coincidence that since 2021, most disciplined officials in the anti-corruption campaign are from local institutions. According to this author’s dataset on disciplined officials from 2021 to April 2024, provincial officials account for 57.6 per cent of these, while central government officials make up 21 per cent. Meanwhile, police and central party agency officials only constitute 2.2 per cent and 1.9 per cent, respectively (Figure 2).[16]
Figure 2. Disciplined senior officials by occupation
Source: Author’s own compilation based on the CPV Central Inspection Commission’s list of disciplined officials (2021-24)
THE CENTRE TAKES BACK CONTROL
The anti-corruption campaign has a two-pronged approach: punishing corrupt officials and establishing a robust governance system to prevent future corruption. This approach involves conducting rigorous anti-corruption investigations against provincial elites and implementing tactical and institutional measures to curb their power and dismantle the localised networks of businessmen and provincial elites. At the National Conference to Review Anti-Corruption Efforts for the Period 2013–20, General Secretary Trong emphasised the danger of “localism” and “regionalism” as they foster venality and interest groups.[17] The party’s long-term goal is to eradicate the entrenched power of local officials through a combination of three methods: deploying central officials to local positions, accelerating the rotation of cadres, and institutionalising local anti-corruption measures.
Initially, the central leadership used its position to strategically assign central officials with strong party or internal affairs backgrounds to replace fallen provincial leaders in the anti-corruption campaign. For example, in Ho Chi Minh City, Nguyen Thien Nhan, Chairman of the Vietnam Fatherland Front, was appointed to replace Dinh La Thang as the city’s party secretary after Thang’s arrest in 2017.[18] In 2020, Nguyen Van Nen, formerly the CPV’s Chief of Staff, succeeded Nguyen Thien Nhan.[19] This trend has intensified after the 13th CPV National Congress in 2021, particularly as the anti-corruption campaign has shifted its focus to provinces. For instance, following the arrest of Hai Duong’s party secretary Pham Xuan Thang in the Viet A scandal, CIC Vice Chairman Tran Duc Thang was dispatched to replace him in 2022. In early 2024, following the arrest of Lam Dong’s party secretary, Vice Head of the Central Internal Affairs Commission Nguyen Thai Hoc was assigned to the role. Other provinces, such as Khanh Hoa, Dong Nai, and Da Nang, also saw central officials taking over, although these appointments were not made immediately after the conclusion of the anti-corruption investigations in these provinces.
The deployment of central officials, especially those with solid backgrounds in internal affairs, serves two critical purposes. First, it stabilises local governments following an investigation, acting as an emergency measure to ensure central control over turbulent local situations. Second, in the medium and long term, this approach aims to eradicate the roots of localised networks. Unlike China, where leaders are often rotated across provinces, many Vietnamese provinces have traditionally been led by local leaders or those with long-term ties to the region, making them susceptible to the entrenched power of local authorities.
Furthermore, the CPV has also accelerated the implementation of the cadre rotation policy (luân chuyển cán bộ) at the “strategic level”, which involves the top provincial leadership. Cadre rotation is not new under communist regimes. China, for example, has been employing this policy since 1992 with great success.[20] Concerned about the negative impact of decentralisation and localism,[21] Vietnam’s central authority has been trying to recentralise by adopting a cadre rotation policy similar to that of China. In 2002, the Politburo issued Resolution 11-NQ/TW aimed to promote the frequent rotation of senior leaders within the system.[22] This policy was further institutionalised with the issuance of Regulation 98-QD/TW in 2017 and Regulation 65-QD/TW in 2022.[23] The CPV aims to have no locally-grown provincial party secretaries by 2025.[24]
This policy gained limited success in the early stages. During the 2000-2005 term, only 16 out of 63 provincial or municipal Party secretaries appointed by the Central Committee were not locals, making up 25.4 per cent. This pattern continued in the following terms, with a more or less similar percentage of non-local secretaries.[25] However, since the anti-corruption campaign accelerated in 2016, there has been a considerable change. In the 2015-2020 term, the number of non-local secretaries increased to 23 out of 63 (36.5 per cent). Since 2021, this number has risen even further, with two-thirds of the provincial party secretaries (42 out of 63) being non-locals as of April 2024.[26] It is highly likely that by the 14th Congress in 2026, the CPV will have achieved its target of having non-local party leaders for all 63 provinces and municipalities.
Institutional measures have also been intensified. In 2022, the CPV mandated that each province establish an anti-corruption steering committee, which is required to report every three months to the National Anti-Corruption Steering Committee, headed by Trong. By the end of 2022, all provinces had complied with this directive.[27] The centre has also issued various laws and regulations to supervise anti-corruption activities. Since 2016, the Government Inspectorate has launched the Anti-Corruption Evaluation Index to rank provinces and ministries based on their anti-corruption efforts.[28] Ironically, the leaders of Vinh Phuc Province, which ranked first in 2023, were implicated in the Phuc Son Group corruption scandal in early 2024, highlighting the ongoing challenges in fully rooting out local corruption.[29]
ECONOMIC AND POLITICAL IMPLICATIONS
The anti-corruption campaign and the subsequent centralisation efforts have had mixed impacts on the provinces. On a positive note, these efforts have partially addressed the issue of entrenched localism in Vietnam, which led to the problem described by General Secretary Nguyen Phu Trong as “hot on top, cold below”.[30] Before the “blazing furnace” started, some localities did not detect or prosecute any corruption cases each year. However, recently, all localities have detected and prosecuted corruption cases at different degrees.[31] Centralisation also aids in constructing unified development policies, particularly for regional development plans which require better coordination among provinces.
However, centralisation efforts have also deterred bottom-up innovation, which was a hallmark of Vietnam’s Đổi mới era and which differentiated it from China’s top-down approach to reform. In fact, provincial autonomy has significantly contributed to Vietnam’s successful market reforms over the past four decades. The success of “fence-breaking” (phá rào) experiments in several provinces, including Vinh Phuc and Ho Chi Minh City, encouraged central leaders to adopt wide-ranging reforms in the late 1980s.[32] The competition among the 63 provinces in attracting investments has contributed to vast improvements in Vietnam’s business environment in recent decades. With the current political climate, provinces are hesitant even to spend public investment, not to mention implementing innovative policies.[33] This, combined with the existing problem of bureaucratic paralysis, has resulted in a lack of economic dynamism in some provinces in recent years.[34] In addition, while the anti-corruption campaign has not yet deterred the inflow of foreign direct investment, prolonged uncertainty might erode investors’ confidence in Vietnam’s political stability. This is further compounded by slower administrative procedures and reforms that have proven to be disruptive to businesses.[35]
Furthermore, the negative impact extends beyond the local level. Centralisation can also jeopardise Vietnam’s collective leadership system, which relies on the relative power of the Central Committee. Throughout history, the Committee has played a crucial role in maintaining checks and balances, holding the party leadership accountable and preventing the accumulation of arbitrary power, as seen in the removal of General Secretary Le Kha Phieu and the dissolution of the Standing Committee of the Politburo in 2001.[36] The provinces, which accounted for roughly 40 per cent of the Central Committee membership prior to 2021, are an integral part of the intra-party democratic mechanism. As the central leadership, particularly the Politburo, is increasingly staffed with securocrats who have limited experience in governance but a strong determination to combat corruption, it will be more challenging for Vietnam to address rising multifaceted issues, from foreign policy and economic recovery to climate change.[37]
CONCLUSION
The anti-corruption campaign has been instrumental in centralising power and reigning in the previously unchecked authority of provincial leaders. However, it has also brought about difficulties in terms of economic development policies and maintaining a balance of power within Vietnam’s collective leadership system. Going forward, the CPV should aim for a better balance between central control and provincial autonomy, accelerate administrative reforms to improve provincial governance, and encourage bottom-up accountability mechanisms instead of depending on top-down supervision to prevent local corruption.
First, while fighting corruption is crucial for building a clean business environment in the provinces, it should be seen as the first stepping stone rather than a final solution. As such, while the cadre rotation policy might be helpful in preventing local corruption, it may not necessarily contribute to the formation of a cohesive local leadership team that can effectively address specific regional issues. Rotated cadres, regardless of their qualification, often encounter difficulties in gaining the trust and cooperation of local officials, who might have reservations about the contextual knowledge of these “parachuted” leaders. Therefore, instead of having a hard target of non-local provincial leadership, the CPV should combine this policy with accelerating the direct voting pilots, which allow party members at certain levels to vote for their leadership committees.[38] This pilot programme has thus far been restricted to the district level, as the CPV is still deliberating its potential impacts. However, if carried out at the provincial level, this will provide the local party leadership with the legitimacy it needs to carry out both anti-corruption efforts and socio-economic policies.
Second, the CPV should also accelerate administrative reforms, and when possible, reduce the number of provinces.[39] Vietnam’s current administrative structure includes 63 provinces and municipalities, a substantial increase from the 40 provinces at the beginning of market reforms. For comparison, China manages only 34 province-level administrative regions despite being 30 times larger in size and 14 times more populous than Vietnam. Reducing the number of provincial units will reduce bureaucratic overlaps and unhealthy competition for investment between provinces, and enable more streamlined and efficient governance from central authorities.
Third, effectively addressing the persistent issue of corruption at the local level requires more than a top-down approach. The CPV should also depend on grassroots efforts, including its vast network of party branches and local members, to supervise local governments’ activities.[40] To facilitate this, it must provide safe and frequent channels for citizens to hold provincial leaders accountable, broaden the direct voting methods for local offices, create favourable conditions for civil society organisations, and strengthen the independent role of the media. It would be counterproductive to combat corruption in bureaucracy by adding more bureaucracy.
ENDNOTES
For endnotes, please refer to the original pdf document.
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