Building a win-win partnership

Earlier this year, eight local dairy goods importers, producers and traders had a lucky escape when the General Department of Customs (GDT) handed down a sentence on tax arrears totalling an estimated VND700 billion (US$31.1 million).

Asked to pay extra value-added tax and import tariffs for material imports which had been miscategorised and therefore under-taxed, Vinamilk, Hanoimilk, FrieslandCampina, Nutifood, Dai Tan Viet, Hoang Lam, A Chau and The He Moi, spread word of their petition against the tax collection decision to local media outlets.

Almost all local economic newspapers published the story on the dairy importers’ appeal to the government bodies which created a wave of public discontent over the GDT’s decision.

As a consequence, the MoF halted the tax collection proposed by the GDT, which not only helped dairy firms escape the tax arrear toll but also aided them in avoiding a force-majeure price hike due to increasing operating costs. 

This is a typical case of enterprises making good use of the press and highlights the media’s influence on public opinion. “Without the help of the media, the firms’ difficulties wouldn’t have been reported let alone addressed by government authorities,” said Vu Tien Loc, chairman of the Vietnam Chamber of Commerce and Industry (VCCI).

The media is acknowledged by the Vietnamese government as a critical tool showcasing the views of businesses on various issues, including the implementation of policies and guidelines, thus helping improve State management.

“Media is the bridge linking enterprise and the state,” Prime Minister Nguyen Xuan Phuc affirmed.

Regarding foreign invested enterprises, the media is both an invaluable source of information and useful tool to build brand names, helping to promote products and spur operations.

For instance, foreign insurers mainly count on local media to change Vietnamese perspective on their services.

“The limited understanding of Vietnamese people about the benefits of life insurance services is a challenge for us as a service provider.  However, through active communication and the support of local media, I think that the situation will certainly improve in the future,” Anton Chang, general director of Taiwanese life insurer Fubon Life Vietnam told VIR..

Last month saw a criminal case reversed in Binh Chanh district, Ho Chi Minh City, against Café Xin Chao. Violations made by local police authorities were eventually uncovered when they prosecuted a coffee shop owner – Nguyen Van Tan, over a slightly late business registration and a lack of certification on food safety.

Nguyen Van Bi, who leased the land area to Tan, was also prosecuted for criminal violations. Bi built a leaf hut to raise ducks, which was deemed to “pose serious risks to the public”.

It was fortunate that Tan and Bi’s miscarriage of justice was heard and circulated by the media. Eventually, the two men were set free while several officials connected to the case found themselves on the receiving end of disciplinary action.

“The case of Café Xin Chao could have gone unnoticed but thanks to local media it got the prime minister’s attention. Café Xin Chao became symbolic of the country’s progress in rooting out corruption and wastefulness,” observed VCCI’s Loc, adding that his organisation would continue to co-operate with the media to contribute inputs in government policy making.

The increasing pace of reforms will improve the business environment and benefit firms as a result. According to the Global Competitiveness Report 2015-2016, Vietnam’s competitiveness index climbed 12 spots from the previous year to rank 68th amongst 140 countries and territories. This marks the third consecutive year-on-year improvement of the Vietnamese economic landscape.

Potential risks of the media

Many businesspeople have voiced concerns on the impartiality of the media and hope that journalists can respect the law and report incidents fairly.

They complained that the media had exacerbated several crises involving enterprises, damaging the reputation and revenues of not only individual firms but also whole industries.

Some businesses also admitted that they had been ‘blackmailed’ by journalists.

A PR manager at a US-backed firm spoke with VIR  that “we have to classify the media into groups ranging from “slightly dangerous” to “extremely dangerous” and have suitable reactions ready to deal with each group. We do not compromise despite always being on high alert,” said the anonymous manager.

He also explained that for businesses subject to European or US law like his, it’s illegal to influence anyone with personal payment or reward. Whenever businesses decide to break this code of ethics, there are consequences, including high financial penalties.

In particular, the US’ Foreign Corrupt Practices Act (FCPA) stipulates that payments to foreign officials, including journalists, candidates and parties are against the law. 

No matter how many violations of businesses and State management agencies that are discovered by journalists, it remains necessary for them to keep their activities lawful and ethical, so as to create an equal and transparent climate for the business community.

Given that an article can negatively impact a business’s operation, Loc warned: “It is very helpful to disclose illegal activities, but journalists need to report stories with faith and justice.”