VIETNAM PARTY CONGRESS: HCMC REACTIONS

UNCLAS SECTION 01 OF 02 HO CHI MINH CITY 000503 SIPDIS SENSITIVE SIPDIS E.O. 12958: N/A TAGS: PHUM PREL ECON SOCI PGOV VM SUBJECT: VIETNAM PARTY CONGRESS: HCMC REACTIONS HO CHI MIN 00000503 001.2 OF 002 ¶1. (SBU) Summary. HCMC-based businessmen, bureaucrats and journalists are disappointed, but realistic about the results of the Party Congress. Despite the strong push from the reform wing, in their view, conservatives and supporters of the status quo prevailed. They are uncertain about the orientation of Prime Minister-select Nguyen Tan Dzung. While decisive, they fret that he draws his strength from Mekong Delta conservatives and the security establishment. Our contacts report that the Party has begun to close ranks after intense pre-Party Congress maneuvering. The Party has made it clear to HCMC-newspaper editors that it wants a "soft landing" on the PMU-18 corruption scandal. While unenthusiastic about the results of the Congress, our contacts see little prospect of significant backsliding in areas where there has been progress. They look to Vietnam's WTO accession as the external push that the Party needs to catalyze further socio-economic reform. End Summary. Early Views Of The Party Congress -------------- ¶2. (SBU) Over the past few weeks, ConGenOffs have pulsed journalists, key businessmen and city bureaucrats on their views of the Party Congress, leadership changes and the role of the media post-Congress as an agent of change and corruption watchdog. All these contacts generally self-identified as being associated with the reform wing of the Party. They were disappointed: status quo at best, perhaps one step back, one journalist told us. HCMC business leaders didn't see anything coming out of the Congress that would accelerate economic growth. The reform camp was particularly disappointed that the Party Congress political report didn't push for an overhaul of the state-owned sector. Despite strong reform entreaties, the State Owned Enterprises remain the "leading force" in the economy. Inside Baseball -------------- ¶3. (SBU) A leading HCMC-based journalist posted to Hanoi for the Party Congress said that the outcome of the Party's personnel debate was in doubt until the last possible moment. A number of senior Party leaders continued to oppose Nong Duc Manh's reselection as General Secretary. The Saturday immediately before the Party Congress, Party elders, including former Party Secretary Le Kha Phieu, launched a drive to draft outgoing SIPDIS National Assembly Chairman Nguyen Van An as an alternative to Manh. Our contact told us that An came under intense pressure not to accept the challenger mantle. Reporters who were covering the story were warned by security services to be "extremely careful" about how and what they reported on the An story. Within 24 hours, An formally declared that he was retiring. Two other well-placed HCMC business contacts told us that HCMC's Party Secretary Nguyen Minh Triet also decided not to challenge Manh for the top Party slot, despite internal balloting in which Triet reportedly placed higher than Manh. ¶4. (SBU) This press contact said that the Politburo was focused purely on internal politics when it made the decision (which it later reversed) not to install new GVN leaders until after the APEC leaders meeting. Party leaders did not consider the optics of lame duck leaders meeting the President and other world leaders a few weeks before they left office. Our contact did not know what led the Politburo to reverse that decision. However, Vo Viet Thanh, Senior Advisor to the Prime Minister for the South told the Consul General on May 8 that the Central Committee will meet shortly to put forward formally a new leadership slate to the National Assembly for confirmation. According to Thanh, the National Assembly will vote on the slate in mid-June. ¶5. (SBU) Our press contact confirmed that Central Vietnam got short shrift in key personnel decisions; the Party did not consider leaders from the Center such as Danang Party Secretary Ba Thanh sufficiently talented to be promoted. Reemphasizing political control over the military was also a preoccupation at the Party Congress. This, our contact said, helps explain why the political report called for reinvigoration of the political commissar system in the military. Our contact added that the Party decided not to promote Nong Duc Manh's son to the Central Committee because of concerns that it would signal that dynastic politics was a factor in personnel selection. HCMC Bureaucrats and Businessmen -------------- ¶6. (SBU) In separate discussions, two HCMC business leaders fretted that HCMC Party Secretary Nguyen Minh Triet's probable elevation to State President effectively sidelines a reformer from his powerbase. HCMC People's Committee Chairman Le Thanh Hai, Triet's likely replacement, is seen as a more pragmatic, political lightweight. One city bureaucrat noted that Vietnam HO CHI MIN 00000503 002.2 OF 002 needs a "rejuvenating," new generation of leaders, but such figures cannot be found. Although disappointed, the two city administrators we spoke with went on to say that "there will be no turning back," but progress will be gradual. The two officials made it clear that they looked to Vietnam's entry into the WTO to drive further change. ¶7. (SBU) Our HCMC contacts are undecided about Nguyen Tan Dzung. They acknowledge that he has a reputation for being decisive and note that he sent his children to the U.S. for higher education. (As a result they say, one married a Vietnamese-American and the other now works for VinaCapital, one of Vietnam's largest investment funds.) That said, they see Dzung drawing his strength from more conservative elements deep in the Mekong Delta and from Hanoi-based security services. They also see him as more pro-China in his orientation, although Vo Viet Thanh insisted that this was a reflection of the specific role that he played as Deputy Prime Minister. The Media and Corruption -------------- ¶8. (SBU) A number of press contacts in HCMC confirmed that the leak of the multi-million dollar PMU-18 corruption scandal (which embroiled inter-alia the Minister of Transportation) was the result of the pre-Congress infighting between General Secretary Manh and DPM Dzung. One press contact said that, SIPDIS while the two leaders do not trust each other, they will be able to work together post-Congress. ¶9. (SBU) Now that leadership decisions have been made, our press contacts report that the Party is closing ranks quickly. Beyond those already implicated in the PMU-18 scandal, other lines of inquiry on corruption would be closed. Highlighting how this process is already underway, on May 8, Vo Viet Thanh told us that the media "misconstrued" the relationship of a Ministry of Public Security General Cao Ngoc Oanh to central figures in the PMU-18 scandal. (Note: UN contacts in Hanoi report that the rehabilitation of General Oanh is underway. He was approved last week to represent Vietnam at an international law enforcement conference in Singapore, a decision made personally by Minister of Public Security Le Hong Anh. End note.) On May 11, Prime Minister Khai issued a public warning to the media, asking the Ministry of Culture and Information to "take measures to seriously sanction press agencies and people involved in writing and publishing untrue information" about the corruption scandal. ¶10. (SBU) Various contacts in Tuoi Tre (Youth) and Phap Luat (The Law) newspapers, two of the HCMC-based newspapers that spearheaded debate on reform and on PMU-18 before the Party Congress, told us that the Party now has tightened up access to information in the Congress' aftermath. They say that Vietnam's reform-oriented press will not press the reform and anti-corruption agenda further at this point. One media contact explained that senior editors of Tuoi Tre, Phap Luat, and the web-based VietnamNet are under intense scrutiny due to their pre-Congress pushing on reform. They have no appetite for further confrontation with Party ideologues at this point. When one Hanoi-based editor known to have pushed the envelope of reporting on Party reform pre-Congress was asked if he was concerned about possible post-Congress pressure, he laughingly replied, "oh, I bought my plane tickets for the United States even before the Party Congress. I was expecting pressure." ¶11. (SBU) Comment: While disappointed that the Party chose control and the status quo over accelerated reform, our contacts outside the Party are realists and survivors. Those inside the Party know when they need to go back "on message." All understand that the relatively greater openness and debate that characterized the pre-Congress period is over and that they need to hunker down until the next opportunity presents itself. End Comment. WINNICK