A Vietnamese court on Monday began a major corruption trial of 22 defendants, including a former senior Vietnamese Communist Party official and a top oil executive the government is accused of abducting from Germany.
Most of the defendants are current or former senior oil executives, including three former chairmen of state-owned energy giant PetroVietnam.
The company and the banking sector have been at the center of an unprecedented crackdown on corruption under the watch of party General Secretary Nguyen Phu Trong.
Former Politburo member Dinh La Thang, 57, also a former PetroVietnam chairman, is accused of “deliberately violating state economic management regulations, causing serious consequences” for his role in awarding PetroVietnam’s Construction Joint Stock Co (PVC) a contract to build a thermoelectric plant without a proper bidding process.
He also allegedly advanced US$67 million to PVC, which did not use the funds for the proper purpose, causing losses of US$5.5 million to the state.
Thang, the first former Poltiburo member to be prosecuted in decades, faces up to 20 years in prison if convicted.
Trinh Xuan Thanh, 51, a former PVC chairman, is accused of the same charge, as well as embezzling US$186,000 from another thermoelectric plant. The embezzlement offense carries the death penalty.
In August last year, Germany accused the Vietnamese intelligence service of kidnapping Thanh from a Berlin park.
Vietnam denied the allegation, saying Thanh turned himself in to police voluntarily, but the incident strained ties and Germany expelled two Vietnamese diplomats.
The trial of Thang and Thanh “sends out a stern warning that there will be no ‘no-go zones’ in this campaign and corrupt officials, no matter who they are and what position they hold, will be brought to justice,” said Le Hong Hiep, a research fellow at the Singapore-based ISEAS-Yusof Ishak Institute. “The campaign has some aspects of political infighting, but the main driver is still the party’s wish to stem widespread corruption, which has undermined the people’s confidence in the party’s governance capabilities, as well as its economic reform efforts.”
Political power was previously fragmented in Vietnam, weakening the fight against corruption, but is now concentrated in the party general secretary, Hiep said.
The corruption crackdown is intensifying, because Trong and his allies were able to consolidate power after a party congress in early 2016 at which Trong won a second five-year term, he said.
Once a rising political star, Thang was dismissed from the all-powerful Politburo in May last year and was subsequently fired as secretary of the southern commercial hub of Ho Chi Minh City.
He was arrested on Dec. 8 and his brother, Dinh Manh Thang, was detained one day later for alleged embezzlement in another case.
Hiep said the trial of Thanh would continue to have a chilling effect on relations between Vietnam and Germany, and might affect a free-trade agreement between Vietnam and the EU.
“The EUVFTA [EU-Vietnam Free Trade Agreement] may be delayed, but I believe it will eventually be ratified by the EU, especially if the trial of Mr Thanh is seen as transparent and fair. In the end, economic considerations may outweigh political ones in this case,” he said.
In Berlin, German Federal Foreign Office spokesman Rainer Breul said embassy representatives were inside the courtroom.
“We will observe it very closely and then evaluate what this means for our policy,” Breul said.
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