Corruption Still Rife in Laos Despite Continued Crackdown Efforts

2018-12-21
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Lao Prime Minister Thongloun Sisoulith speaking during the 2016 Association of Southeast Asian Nations (ASEAN) Summit has attempted to make the fight against corruption a signature of his administration, Sept. 7, 2016.
Lao Prime Minister Thongloun Sisoulith speaking during the 2016 Association of Southeast Asian Nations (ASEAN) Summit has attempted to make the fight against corruption a signature of his administration, Sept. 7, 2016.
AFP

The government of Laos says it has been ramping up its efforts to battle corruption over the past two years, but NGOs say that the situation in Laos is getting worse.

Many Lao government officials publicly say that corruption is a huge problem, and have taken action to combat it.

The State Audit Organization’s chairwoman Viengthong Siphandon told the Lao National Assembly on Nov. 21 that next year they will investigate 99 targets or government agencies that receive financial aid or loans from foreign sources.

“This year, we inspected 54 targets and found that the government lost $30 million to corruption,” she said.

Siphandon said her agency will audit revenue collection, detailed expenditures, the state budget, rural development and poverty reduction programs, programs that are funded by grants and loans, and the operations of state-owned enterprises.

Siphandon’s efforts mirror those of Deputy Prime Minister Bounthong Chitmany, who according to earlier RFA reports revealed at a party meeting that agencies he heads discovered 146 cases of corruption involving 994 officials who caused a total loss of $120 million.

Bounthong said 14 of the 994 were convicted for economic crimes, with 520 charged and awaiting trial. Of these 420 were investigated and the rest were interrogated.

Meanwhile, at the International Anti-Corruption Day celebration in Vientiane Capital on Dec. 9, State Inspection and Anti-Corruption Authority Vice Chairman Sinay Mienglavanh said in 2017 and 2018 his agencies “in cooperation with ministries and provinces have inspected many targets that were found to be involved in corruption.”

A total of 587 targets and 37 agencies nationwide were inspected last year, authorities said.

“There are a lot of leaks,” a resident of Vientiane Capital told RFA’s Lao Service. “For example, they collect 100 million in taxes but give only 50 million to the government. They can pocket the other 50 million.”

The Inspection Authority of the Security Ministry also inspected its own employees last year and announced on Dec. 11 that they found 64 cases of corruption, including 24 police officers who collectively embezzled $360,000. Those officers were reprimanded.

An unidentified ministry official said, “It’s difficult. We have to have evidence that clearly shows they did something wrong.”

“We need to investigate, digging through all the details,” the official added.

In September, the finance minister fired eight employees, including the heads of the finance and budget departments, for falsifying documents to import fuel, saying it was for railroad construction.

Lao government policy allows for fuel imported for this purpose to be tax exempt, but the officials sold the fuel on the market for a profit of about $1.3 million.

“We collect taxes according to the government’s [tax code],” an official in Champassak province said to RFA.

“We send the money to a higher level in the government, but we don’t know what happens to it after that,” the official added.

Corruption in Laos worsens

Despite the efforts on several fronts to curb corruption, Transparency International says that Laos is becoming even more corrupt.

The Berlin-based global anti-corruption coalition in February published its global corruption perception index, in which Laos was ranked 135th of 180 countries, dropping 12 places from the previous year.

Laos’ index score was 29 on a scale where 0 is highly corrupt and 100 is very clean. According to the report, Laos is the second most corrupt country in the ASEAN region, behind only Cambodia.

“Corruption is intensifying,” Deputy Prime Minister Chinmany told the National Assembly in October.

“For example, the real cost of building a kilometer of road is only $400,000 but the government ends up paying $1.7 million for it. $1.3 million is lost [to corruption],” he added.

A Vientiane resident said told RFA “Corruption is everywhere. It has become tradition!”

“For example if you request a service, you have to attach a white envelope that contains ‘tea money’ of at least $7 or so, or you’ll have to wait a long time,” the resident said.

The World Bank published a survey in February that found widespread and growing corruption as the main obstacle to doing business in Laos.

Vice President Phankham Viphavanh earlier this year said at a meeting of the Security Ministry, “Corruption is intensifying.”

“Laws are not effective, officials of all levels are corrupt. They abuse their power and positions to rob the country,” Viphavanh said.

“[They] take land, money, wood and gold for personal use. Over the past five years the nation has lost $600 million,” he added.

A Laotian source living in a southern province explained why corruption is so rampant, saying, “Corruption is getting worse because salaries are too low, not enough to live on.”

“At the same time, people like to show off [to give the perception] that they are living in luxury, especially their cars and houses,” the source added.

Meanwhile, a traffic officer in Xieng Khouang province said police officers take bribes because of their low salaries.

National Assemblywoman Valy Vetsavong said in November 2017 during a meeting of parliament, “The loss to corruption is massive.”

“Officials, businesses and investors are accomplices. These people are bad,” she said.

Prime Minister Thongloun Sisoulith told parliament last year that the government is going to crack down on corruption.

“There are too many bribes under the table,” Sisoulith said.

An inspector with the State Audit Authority told RFA on the condition of anonymity, “Frauds occur in development projects.”

“Dishonest officials across the whole country embezzle state funds and assets, including money for schools and health services.”

Reported by RFA's Lao Service. Translated by RFA's Lao Service. Written in English by Eugene Whong.

Comments (4)
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Anonymous Reader

The effort by the Lao government to erase corruption is just a game to fool the world in order to get funds from the free world countries. The corruption starts from the party-state so the fight must start from the party-state too. Who are billionaires in Laos ? The party-state people. Who control funds from the outside world? The blood-sucking party-state. Those are arrested by the Lao government are just"small hands" who received orders from their way up high bosses.Lao party-state, if you try a bit to feel guilt in what you do perhaps you can fight corruption in your country.But you'll never feel guilt because everything you do is based on class struggle. You as communists you must come on top and in the end you will turn Laos into a classless society. I tell you what? You are scums because you use your out-dated rhetoric to get rich and to enrich your friends and families. You deserve to disappear from this world of ours and it'll be a better place to live.

Dec 28, 2018 06:42 PM

independent Jurist

The hard efforts carried out by the Laos government to crackdown on corruption deserve to be praised and encouraged!Good job, keep going!

Dec 28, 2018 09:05 AM

Anonymous Reader

Dear Mr PM Thongloune with due respect, you are one member of the same gang who rules over your country. You want to erase corruption but this is the least of your concern. Your whole gang is excrement of the world, you are the laughing stock of the universe and you are killing your country and your people every day a little more. Your class-struggle policy has led to a disaster whose effects would be felt for the next hundreds of years. The only way to save Laos is that you go away and never come back so your people and country can live in peace and prosperity.

Dec 24, 2018 04:12 AM

World Citizen

from Vietiane

The World is Finally known and recognise LAOS is a TRULY CORRUPT country.
LAOS has BLIND the Whole World for so long Saying this LAOS is a normal country run by Lao Government BUT THE REALITY IS:
LAOS IS RUNNING AND GOVERN BY COMMUNIST LAO-VIETNAM GANGS DESIGN BY COMMUNIST VIETNAM TO ABUSE POWER AND ROB PEOPLE AND TO KEEP THIS PLACE LIKE A DISASTER OUT OF CONTROL SO COMMUNIST VIETNAM COULD DO WHAT EVER THEY WANT TO HERE IN LAOS.

Dec 21, 2018 02:37 PM

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