US embassy cable - 03HANOI1549

UNCLAS SECTION 01 OF 06 HANOI 001549 
 
SIPDIS 
 
STATE FOR INL/AAE; EAP/BCLTV; INR/EAP/SEA; L/LEI 
 
E.O. 12958: N/A 
TAGS: SNAR, PREL, PGOV, KCRM, PINS, VM, CNARC 
SUBJECT:  NARCOTICS CERTIFICATION PROCEDURES FOR 2003 
 
REF:      A.  STATE 153955         G.  Hanoi 1043 
          B.  STATE 99648          H.  Hanoi 353 
          C.  UNVIE 373            I.  Hanoi 549 
          D.   02 Hanoi 2980           J.  Hanoi 1504 
E.   02 STATE 190339          K.  Hanoi 550 
F.   HCMC 499            L.  Hanoi 117 
                                   M.  Hanoi 1538 
 
1.  (U)  In response to ref a request, post is providing 
responses keyed to 2003 certification demarche points (ref 
b) as follow: 
 
2.  (U)  Implementation of the counternarcotics Master Plan 
for 2001-2005: 
 
--This is an ongoing activity that continues to make slow 
but steady progress.  The United Nations Office of Drugs and 
Crime (UNODC) continues its support with a USD 276,000 
project designed to assist the GVN to finalize the plan 
(which now is extended to 2010).  The USG is contributing 
USD 100,000 to the project.  According to UNODC Resident 
Representative Dr. Doris Buddenberg, the GVN submitted its 
final draft to UNODC in January and the plan now is in the 
Office of the Government (Prime Minster's office) waiting 
for approval.  According to Dr. Buddenberg, approval should 
be forthcoming "soon," as MPS and MOLISA have resolved 
interagency issues concerning responsibilities for drug 
treatment and rehabilitation. 
 
3.  (U)  Continued focus on narcotics-related corruption, 
including policy statements that make it clear that 
narcotics-related corruption will not be tolerated and will 
be severely punished, including the removal and prosecution 
of corrupt officials, when found: 
 
--The UN, law enforcement agencies, and even the GVN view 
corruption in Vietnam as an endemic problem that exists at 
all levels and in all sectors.  In its public statements, 
the GVN takes a strong stand against corruption in general, 
but has not singled out narcotics-related corruption for 
specific attention.  Colonel Bui Xuan Bien, the director of 
the Standing Office for Drug Control (SODC), confirmed that 
"any GVN official who violates laws about corruption" would 
be prosecuted.  A major criminal case (that of "Mafia" chief 
"Nam Cam" in Ho Chi Minh City) included charges of 
corruption, in addition to crimes such as murder, assault, 
gambling, etc.  Two defendants had been expelled from the 
Communist Party of Vietnam's Central Committee in 2002 in 
connection with this case; one of these had also been a Vice 
Minister of Public Security.  Another defendant had been the 
Deputy Supreme Prosecutor.  Of the 155 defendants, including 
numerous police officials, 154 were found guilty.  There 
were six death sentences and a variety of other prison 
sentences, including life imprisonment.  On the day of the 
verdict, one of Nam Cam's top syndicate officials, Nguyen 
Van Hoa, and seventeen others were arrested in Japan for 
trafficking in heroin, according to press reports.  In 
March, nine MPS officials were judged guilty for bribery. 
In June, the People's Court in Quang Nam province in central 
Vietnam sentenced the director of a state-run construction 
company to life imprisonment for embezzlement.  In another 
case, President Tran Duc Luong rejected leniency pleas from 
two former executives sentenced to death for a scheme to 
"appropriate state property through graft," according to a 
May press report. 
 
--Senior GVN officials continue to speak out against 
corruption.  In late January, Prime Minister Phan Van Khai 
visited MPS and emphasized the need to fight all crime and 
corruption.  In March, the Prime Minister said that 
officials who "turn a blind eye to drug-related crime will 
be punished."  In February, the Ministry of Foreign Affairs 
spokesperson said in response to a question that the GVN 
considers the fight against corruption "an important task." 
 
--A bilateral anti-corruption agreement with Sweden, 
providing about USD 2.7 million to fund research on socio- 
economic policy and anti-corruption measures over a three- 
year period was signed in 2002.  Under the agreement, Sweden 
is supporting a study on the "institutional framework of 
anti-corruption policies."  While the official agreement is 
with the Ministry of Planning and Investment, the actual 
partner is the Communist Party of Vietnam and, according to 
an official of the Swedish Development Corporation, the 
program is "quite sensitive."  A diagnostic study on how to 
implement the program "should be started by the end of the 
year." 
 
4.  (U)  Developing and implementing regulations enabling 
the tools provided in the new counternarcotics law to be 
used fully and effectively to investigate major drug- 
trafficking groups: 
 
-- The National Assembly passed a comprehensive 
counternarcotics law on December 9, 2000, which came into 
effect on June 1, 2001.  The GVN directed MPS and other 
ministries, including the Ministry of Justice (MOJ), to 
agree on a common approach for implementation.  In addition, 
MOJ was tasked with working with MPS and other relevant 
agencies to review existing counternarcotics legal documents 
and make appropriate amendments to facilitate implementation 
of the new law.  According to Dr. Buddenberg, UNODC is 
assisting the GVN in an "ad hoc" manner in this area, 
especially concerning implementing decrees and legal 
training.  There is now a "donor coordination" group 
consisting of Sweden, Denmark and the USAID-funded Support 
for Trade Acceleration project that meets once a month to 
discuss legal issues; however, the focus is not specifically 
on narcotics. 
 
--Since our last report, the GVN has made public eight 
decrees related to the counternarcotics law.  These decrees: 
a.  list the narcotic substances and pre-substances; 
b.  guide the control of lawful drug-related activities in 
Vietnam; 
c.  stipulate the rehabilitation order, procedures, and 
regimes for drug addicts consigned to compulsory 
rehabilitation centers; 
d.  designate family organization and community-based 
rehabilitation; 
e.  prescribe the regime of compensation and allowances for 
individuals, families, agencies, and organizations suffering 
life, health, and property damage while participating in 
drug prevention activities; 
f.  stipulate the rewards and commendations for individuals, 
families, agencies, and organizations recording achievements 
in drug prevention; and, 
g.  assign responsibility on international cooperation in 
the field of drug prevention.  According to DEA's Hanoi 
Country Office, this decree contains no concrete formulation 
fro creating a framework to allow for information sharing 
and/or cooperative law enforcement efforts, however.  The 
decree also does not provide implementing regulations for 
international controlled deliveries, which is at least 
mentioned in the 2001 drug law. 
 
--An eighth (and key) decree, concerning law enforcement, 
has apparently been issued, but according to an MPS 
official, it has not been made public due to its 
"sensitivity."  According to DEA, without knowing what is in 
this decree and/or without access to MPS officers, DEA (and 
other foreign law enforcement entities) are unable to know 
what law enforcement training would be most useful. 
 
--A preliminary analysis by a UNODC legal official concluded 
that the decrees are "insufficient in terms of establishing 
a proper drug control legal system," however.  The decrees 
tend to focus on drug control areas, which are "generally 
less complex and controversial," the official added.  There 
is still a need for "new and proper" legal instruments in 
areas such as procedures, conditions, systems for 
investigations, international cooperation, extradition, 
controlled delivery, and maritime cooperation, according to 
the analysis. 
 
--Another problem is Vietnam's lack of judicial capacity. 
The UNODC's Dr. Buddenberg lamented that this issue is 
"still not adequately addressed" by the donor community. 
Without improved judicial capacity, concrete progress in 
this area "will be difficult," she opined. 
 
--While not directly related to the drug law, on May 29 the 
GVN issued Decree 58, which deals with the control of 
import, export, and transit of drug substances, precursors, 
additive drugs, and psychotropical substances.  According to 
the decree, only businesses authorized by the Ministries of 
Health, Industry, and Public Security can import/export drug 
substances, precursors, additive drugs and psychotropical 
substances for specific, licit purposes.  The GVN has tasked 
MPS to coordinate with other concerned ministries and 
agencies to manage and control the import/export of these 
narcotic substances.  While this decree may prove useful, 
thus far the GVN has shown a tendency not to use the laws 
already on the books in a proactive manner. 
 
--While the counternarcotics law allows for law enforcement 
techniques such as controlled deliveries, the GVN appears 
reluctant to engage in this area and/or meaningfully 
cooperate with DEA's Hanoi Country Office or other law 
enforcement entities in Hanoi (ref l).   In January, 
February, and March 2003, DEA informed MPS' counternarcotics 
unit (C-17) about three major heroin shipments transiting 
Vietnam.  C-17 officials did not respond or react to the DEA- 
provided information.  According to DEA, implementing 
controlled delivery techniques could have resulted in major 
seizures.  In addition, even when DEA has offered funding to 
assist in an operation, DEA's MPS counterparts have not 
cooperated.  Furthermore, the MPS continues to stick to its 
line that it is unable to share operational information with 
DEA due to "national security considerations." 
 
5.  (U)  Increased seizures of opium, heroin, and 
amphetamine-type stimulants (ATS), followed by increased 
investigations and prosecutions of traffickers: 
 
--The GVN has continued to arrest and prosecute drug 
traffickers in 2003, but there is a relative decline thus 
far in 2003.  According to GVN statistics, during the first 
five months of calendar year 2003, there were 4,135 drug 
cases with 6,310 suspects arrested.  If projected over the 
entire year, it appears that case numbers will decline 
significantly - by 30 percent in the number of cases and by 
35 percent in the number of suspects arrested. (Note:  For 
past drug reports, we have routinely received such 
statistics from SODC.  Despite several requests, SODC 
declined to provide us with updated drug statistics in 2003. 
We instead obtained the information from the Ministry of 
Labor, Invalids, and Social Affairs - MOLISA, which also 
plays a role in counternarcotics activities, primarily in 
the drug treatment and rehabilitation area.  End note.) 
Concerning arrest and case statistics, DEA and other law 
enforcement entities have not changed their view that most 
arrests involve relatively low-level street dealers. 
 
--On the seizure front, the official press (and post - ref 
j) reported on a major seizure of 40 kilograms of heroin 
that occurred in June.  This seizure represents over 65 
percent of the total amount of heroin seized in Vietnam 
(57.4 kilograms) during 2002.  Despite this relatively 
impressive seizure, the UN's "Mini-Dublin" 2003 report noted 
that, Vietnam remains a "major transit route for drug 
traffickers, with Vietnamese traffickers demonstrating 
increased sophistication in trafficking techniques and 
concealment."  The report further stated that Vietnam is 
atypical in that very few drugs (at least until this recent 
seizure) are seized at border crossings, indicating the 
"inefficiency of Vietnam's border control capacity." 
 
--Attempting to address this issue, UNODC (supported 
primarily by the USG) will implement beginning in July 2003 
a project to improve law enforcement and information 
capacity within the GVN.  Concerning prosecutions, the GVN, 
according to law enforcement sources, moves fairly 
vigorously to prosecute those arrested.  However, those 
prosecuted are generally street-level dealers.  In addition, 
GVN law enforcement authorities have not demonstrated the 
will to pursue higher-level narcotics traffickers, according 
to DEA. 
 
--Vietnam's threshold for the death penalty is among the 
lowest in the world and drug sentences tend to be harsh. 
Possession of 100 grams of heroin or 20 kilograms of opium 
can result in the death penalty, according to SODC and press 
reports.  An April press report noted that a man and his 
wife in Vung Tau were sentenced to death for trafficking 
33.3 kilograms of opium and 0.3 kilograms of heroin.  From 
January to April 2003, 27 drug traffickers were sentenced to 
death.  On June 12, a 15-year old Australian - Vietnamese 
girl received a life sentence for attempting to bring about 
six-tenths of one kilogram of heroin into Vietnam, according 
to a press report. 
 
--MOLISA's statistics for seizures other than heroin also 
point to a sharp downward trend.  Projecting the January - 
May statistics over CY 2003, opium seizures may decline 48 
percent; cannabis 54 percent, and ATS by nearly 75 percent. 
Dr. Tran Xuan Sac, Director of National Policy and Planning 
in MOLISA's Department of Social Evils Prevention, 
nonetheless predicted that seizures would "probably 
increase" over the course of the year, while declining to 
explain how or why. 
 
6.  (U)  Productive cooperation with regional neighbors, 
including Laos, the PRC, and Burma to reverse threatening 
trends in narcotics trafficking: 
--During 2003, Vietnam has continued efforts at regional 
cooperation.  According to a January 2003 "People's Police" 
press report, from 1998 to the end of 2002 the GVN sent 122 
delegations, including over 700 counternarcotics police 
officials, to overseas training and/or conferences.  Vietnam 
has existing counternarcotics MOUs with the PRC, Burma, 
Thailand, Cambodia, and Laos.  In May, Vietnam was set to 
host an "MOU Conference" in Hanoi, but the conference was 
postponed until October due to SARS.  According to SODC and 
press reports, in March MPS Deputy Minister Le The Tiem 
visited the PRC and discussed bilateral drug cooperation 
with the leadership of the PRC's Drug Control Committee. 
Tiem also traveled to Thailand to learn more about 
Thailand's drug control activities; during this visit, Tiem 
also proposed hosting a drug control conference among six 
Vietnamese northern border provinces and two PRC border 
provinces.  In February, another GVN delegation traveled to 
Thailand to attend a regional conference on controlling 
opium poppy cultivation.  In April, Vietnamese and Lao 
provincial counterparts from Nghe An and Laos' Xiengkhouang 
provinces met to improve cross-border counternarcotics 
cooperation.  In June, Vietnam hosted the ASEAN Senior 
Officials Meeting on Transnational Crime (SOMTC) and 
Counterterrorism as well as separate SOMTC+EU, SOMTC+China, 
SOMTC+3, and SOMTC+US sessions.  The meetings included a 
discussion on regional drug issues. Specifically, the 
Burmese delegation discussed the need for an enhanced 
regional approach.  According to DEA, there is no evidence 
that the attendance of GVN law enforcement officials at 
regional or international fora leads to enhanced 
cooperation, however. 
 
7.  (U)  Continued eradication of domestic illicit poppy 
cultivation and support of crop-substitution projects to 
eliminate it completely: 
 
--The USG officially estimates that there are about 2,300 
hectares of opium poppy under cultivation in Vietnam. 
However, there has not been a satellite-based opium yield 
survey since 2000.  This estimate is considered high by the 
GVN, UNODC, and law enforcement sources.  The GVN estimates 
approximately 315 hectares of poppy cultivation in generally 
remote, mountainous regions.  According to UNODC's "Global 
Illicit Drug Trends (2002), "due to small production, 
Vietnam cultivation figures have been included in the `other 
Asia' category since 2000."  In 1999, the last year Vietnam 
was considered independently, UNODC estimated opium 
cultivation at 442 hectares.  Based on numerous provincial 
visits, there appears to be a sincere effort to eradicate 
poppy, when found.  However, GVN officials have admitted 
that complete eradication is unrealistic, given the 
remoteness of mountainous areas in the northwest and extreme 
poverty among ethnic minority populations who still use 
opium for medicinal purposes.  Regrowth in remote areas, 
particularly in the northwest, remains a small, but 
apparently persistent problem, as does limited cannabis 
growth in areas near the Cambodian border.  According to 
SODC's Bien, the GVN eradicated 124 hectares of opium poppy 
during the first quarter of CY 2003, virtually all of it in 
the northwest.  Bien confirmed that "when we find poppy, we 
eradicate it." 
 
--Regarding crop substitution, there is a major UNODC 
project (with significant USG support) ongoing in the Ky Son 
district of Nghe An province, one of the drug "hotspots" in 
northern Vietnam.  This project, currently in its second 
phase, includes a crop substitution/alternative development 
component, where various types of fruit trees and other 
enterprises, such as bee raising, have been implemented in 
areas formerly dedicated to poppy.  UNODC's Buddenberg 
viewed the first phase as "successful," with an increase in 
agricultural production and corresponding drop in drug 
activity.  Based on an Embassy monitoring visit in April 
(ref g), there is progress in the livestock and agricultural 
models (the focus of USG assistance); however, the selection 
process of those receiving project assistance was not clear, 
a problem that UNODC is now addressing.  A similar project 
planned in Son La province, another drug area along the Lao 
border, will not proceed.  Prior to the proposed project 
signing, the GVN requested an alternate project location and 
more autonomy in administering the project.  UNODC declined 
to meet the GVN's demands; after deliberation, UNODC decided 
not to proceed. 
 
--In addition to Ky Son, the GVN's Ministry of Agriculture 
and Rural Development (MARD) has continued to support 
projects in various provinces.  The GVN, through MARD, 
independently supports crop substitution projects in other 
provinces, including Hoa Binh, Yen Bai, Ha Giang, Cao Bang, 
and Lang Son.  The GVN has tasked MARD to develop a national 
crop substitution proposal to include in the GVN's 2001-2005 
Master Plan.  To avoid indirectly encouraging poppy 
cultivation through subsidies for eradication, the GVN has 
placed all crop substitution subsidies under national 
programs to alleviate poverty in poor, mountainous regions. 
 
8.  (U)  Continued focus on creating a legal framework to 
address money laundering and other forms of financial 
crimes: 
 
--At present, money laundering is not considered a major 
issue in Vietnam because of the state-controlled banking 
system and high transaction costs.  However, partly due to 
the work on terrorist financing, over the last year there 
has been a growing awareness and concern among State Bank of 
Vietnam (SBV) officials on the issue of money laundering and 
financial crimes in general.  SBV officials have begun to 
work with the U.S., the IMF, and other donors to identify 
and address weaknesses in their banking system.  However, 
without major reform (including greater transparency), it 
will be difficult for sufficient safeguards to be 
introduced.  According to a 2003 UNODC report, "Vietnam is 
obviously ill equipped to fight the escalation in financial 
crimes unfolding in most of Southeast Asia."  While the 
State licenses wholly foreign-owned and joint venture state- 
private banks to operate alongside the State commercial 
banks, their market penetration and asset base are small. 
Foreign exchange currency controls for private and joint 
venture banks are considered to be strict.  However, the 
banking system in Vietnam is segmented and lacks real, 
transparent, and easily verifiable controls.  Although banks 
are under the supervision of the State Bank, that 
supervision is minimal.  Vietnam is in the process of 
implementing banking reform as part of their World Bank and 
IMF loans, and some of that reform is relevant to these 
issues (increased transparency, more effective regulation, 
and overall stability of the banking system).  It will be 
critical that reform of the banking system is accompanied by 
law enforcement training regarding financial crimes. 
 
--There is currently no specific law in Vietnam regarding 
money laundering, although it is mentioned in the 
comprehensive counternarcotics law very generally, but 
internal discussion has begun on the need to draft specific 
regulations on this issue.  According to UNODC, the GVN is 
aware of the potential problem and "trying to take 
preventive measures" such as inviting international experts 
and participating in ILEA training.  To that end, post had 
lined up several appropriate State Bank officials to attend 
ILEA-sponsored training on financial crimes in May; 
unfortunately, Vietnam's participation in the course was 
cancelled by ILEA due to SARS. 
 
9.  (U)  Increasing efforts to support drug awareness and 
prevention, demand reduction, and treatment of drug users 
and addicts: 
 
-- The GVN views drug awareness and prevention as a 
significant objective in its fight against drugs as well as 
an integral part of its efforts fully to comply with the 
1988 UN Drug Convention.  The GVN has continued a steady 
drumbeat of anti-drug propaganda, culminating in June's drug 
awareness week (the week of June 23).  If last year's 
activities are any guide, during the week youth and mass 
organizations will engage in various activities to spread 
the anti-drug message.  These include art contests, 
speeches, and meetings.  Within the past few months, state- 
controlled television has begun a weekly program called "SOS 
Drugs" and has been airing a series of anti-heroin spots. 
According to the UNODC's Buddenberg, Vietnam and UNODC will 
be signing an agreement to implement a demand reduction 
project (supported mainly by Italy) "within the next few 
months." 
 
-- By the end of 2002, the GVN admitted officially to 
142,000 registered addicts, although the UN and other 
agencies suspect the actual number is substantially higher. 
Even that official figure is 25 percent higher than 2001. 
MOLISA is the GVN ministry tasked with providing drug 
treatment services.  Since 2001, emboffs have visited most 
drug treatment centers in northern Vietnam as well as some 
in the south.  According to SODC, there are 73 centers at 
the provincial level, which have a capacity of between 50 to 
3,000 addicts each.  Provincial authorities run most 
centers, but some are supported by mass organizations, such 
as the Youth Union.  Drug treatment centers range from the 
most basic to relatively modern.  Most suffer from a lack of 
physical and material resources.  The addict population is a 
combination of those who enter voluntarily and others who 
are undergoing "compulsory" treatment.  Drug treatment, as 
with other public sector services in Vietnam, suffers from a 
lack of resources.  However, the GVN has continued efforts 
to expand drug treatment in 2003.  According to a March 
press report, of 142,000 addicts, approximately 48,000 had 
undergone detoxification treatment. 
 
--Some drug treatment centers suffered some escapes, likely 
due in part to a 2002, GVN decree that mandated minimum 
stays of one year.  No such escapes have been reported in 
2003, however.  Vocational training in the centers is 
uneven, ranging from fairly good to nonexistent.  This is 
mainly due to a lack of resources.  Lack of resources has 
also had a negative impact on the GVN's plan to improve drug 
treatment in one of Vietnam's "hotspot" provinces, Nghe An. 
A 700-bed center was scheduled to fully open in early 2003, 
but due to funding constraints, this has been delayed until 
the end of 2003, according to MOLISA's Dr. Sac.  Presently, 
there are "only a few addicts" staying in the partially 
completed facility, he added. 
 
--In addition to drug treatment centers, those with less 
severe addictions may be treated under a community-based 
treatment scheme (ref I).  Despite apparently good 
intentions, it appears that implementation is rather thin 
and uneven, with "peer pressure" the main component of 
treatment following detoxification.  Community-based 
treatment nonetheless at least provides addicts with a 
supportive infrastructure (and limited vocational training) 
that would otherwise not be available. 
 
--During its June 2003 session, the National Assembly 
approved a five-year pilot project on post-treatment 
vocational training developed by the HCMC People's 
Committee.  The one to three-year program is compulsory for 
those judged at high risk for returning to drugs.  It is 
voluntary for others who have finished their compulsory 
treatment and judged less at risk.  According to Nguyen 
Hoang Mai of the National Assembly's Social Affairs 
Committee, the goal of the program is to try to reduce the 
relapse rate (generally estimated at about 80 percent, 
similar to western countries) by providing recovering 
addicts with more skills that will enable them to assume 
"productive lives after treatment."  The pilot project, set 
to begin on August 1, will be implemented in HCMC (where the 
relapse rate may be as high as 90 percent), and other 
provincial cities, according to press reports. 
 
10.  (U)  Signing a narcotics agreement with the United 
States to permit even closer counternarcotics cooperation 
between Vietnam and the United States: 
 
--We are unable to report progress on this front during 
2003.  The GVN has yet officially to respond to the 
Department's October 2002 non-paper, despite repeated 
promises to do so.  The GVN apparently harbors concerns over 
concerning human rights, taxation, and the training 
participant certification regarding non-drug trafficking 
(refs k and m).  The MFA has also unofficially expressed 
concern over what officials have termed the "small size" of 
the projects attached to the draft Letter of Agreement 
(LOA).  Senior GVN officials and official documents continue 
to claim that signing the agreement remains a priority; this 
view has not thus far translated to meaningful progress. 
Both countries nonetheless agree in principle that an LOA 
would enhance cooperation and allow the bilateral 
relationship to develop further. 
BURGHARDT