Lao Officials Slam Corruption

Two top officials say bribery is commonplace in bidding on major construction projects in Laos.
2009-02-11
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BANGKOK—Two senior Lao officials have lashed out at bribery and corruption in Laos, which they say is commonplace in bidding on major construction projects.

Both domestic and international companies often bribe officials before bidding begins, one official, who spoke on condition of anonymity, said in an interview.

“When many companies bid, they give bribes to officials behind the scene. ‘I have money, you have projects. Let’s go to have lunch together.’ That’s the way it is in Laos,” the official said.

Firms that win contracts are often owned at least in part by Lao nationals, which permits streamlined deal-making and profit-sharing, he said. Foreign-owned companies use Laotian representatives who can act as negotiators.

Sometimes, the official said, the bid winner sells the project to another company for a higher price.

“Winning Lao-owned companies sometimes resell the bid to another company and can make up to U.S. $10 million in the process. The buying company may bear a Lao name, but it is actually operated by foreigners. It operates under that name, but these people don’t do any work,” he said.

The official said bribes to officials are generally used in construction projects involving major roads, large bridges such as those spanning the Mekong river, and dams.

Call for probe

Another official, also speaking on condition of anonymity, called the problem of corruption in Laos “unpreventable,” saying “investors need projects and officials need money.”

But he said that the government had pledged to investigate the problem and called on citizens to aid in the task.

“We are cracking down on these individuals…If anybody has evidence of corruption, please come forward and present names and pictures of the officials,” he said.

“We’ll prosecute them.”

UN report

The United Nations Development Program (UNDP) last year issued a damning report on corruption in Asia, saying the region was rife with small-scale corruption that contributes to the poverty of millions.

The report, “Tackling Corruption, Transforming Lives,” said graft denies essential services to Asia’s neediest groups.

The report suggested instituting a merit-based civil service and raising civil servant salaries, in addition to improving press freedom and international cooperation to monitor corruption in the region.

It also called on governments in Asia to clean up their police, health, education, and environment sectors.

Prevention ineffective

Laos was a signatory to the UN Convention on Anti-Corruption in 2003, and the Lao National Assembly adopted its Anti-Corruption Law in 2006, but the lack of any real mechanism to monitor graft has made prevention ineffective in many sectors, experts say.

Transparency International, which monitors corruption worldwide, currently ranks Laos 151st out of 180 in its 2008 Corruption Perceptions Index.

Lao National Assembly Vice President Saysomphone Phomvihan last year said the government had lost millions of dollars to corruption, with departments overseeing investment and revenue collection responsible for the largest losses.

Phomvihan also said corruption was the major concern cited by people submitting opinions and complaints to the National Assembly last year.

The U.S. State Department has said that despite efforts to rein in corruption, there exists “a widespread public perception” that many within the government are corrupt.

It noted that the wages of all government officials are extremely low and said many officials were given broad powers that they might easily abuse.

The ruling Lao People’s Revolutionary Party uses its control of government authorities and media to block public censure of corrupt officials who are party members, the report said, and a lack of laws providing for public access to government information makes it difficult to monitor internal activities.

Original reporting by Krongkran Koyanakkul for RFA's Lao service. Translated y Max Avary. Lao service director: Viengsay Luangkhot. Executive producer: Susan Lavery. Written for the Web in English by Joshua Lipes. Edited by Sarah Jackson-Han.

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