3. Effective Governance
3.1 Democratic Representation
3.2 Lack of Corruption
3.3 Efficient Administration
In-Country Assessment Information

3. Effective Governance

Goal – A popularly elected government free of corruption and functioning efficiently and transparently enough to guarantee economic freedom to individuals and support equitable property markets


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3.1 Democratic Representation


Core Question: Does the country have free and open elections for the leadership and can citizens engage in free enterprise? No – Very Weak – the democratization process is moving very slowly.


3.1.1  Voice & Accountability  Are citizens able to elect their government and do they enjoy freedom of expression, association and a free media? No – Very Weak – Percentile Rank – 8.5 Trend ­

Source: Governance Matters, World Bank –  Are citizens free to form political and civic organizations free of state interference and surveillance? No – Very Weak – Score 1.47 out of 10

Overall Ranking – 143rd out of 167. Trend ­

Source: The Economist Intelligence Unit Democracy Index  2011


3.1.2  Public Information

Overall Score – Very Weak 44 out of 100 (2009) Are the regulations governing conflicts of interest in the executive and legislative branches of government effective? No – Executive Score 41 out of 100 – Very Weak; Legislative Score 18 out of 100 – Very Weak Can citizens access legislative processes and documents?
No – Score 0 out of 100 – Very Weak

Source: Global Integrity Report –

3.1.3  Market Intervention

Overall Ranking – Very Weak 140th out of 179 Trend To what extent does the government intervene in the private sector including state owned industries?
Score 72.4 out of 100 with a higher score indicating less intervention Trend ­ To what extent does the government control prices? Score 65.3 out of 100 with a higher score indicating less control Trend 

Source: 2012 Index of Economic Freedom – Heritage Foundation




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3.2 Lack of Corruption


Core Question: Is the public sector transparent and free of corruption? No – Weak – first anticorruption law passed in 2005 but implementation has yet to affect day-to-day activities.  



3.2.1   What is the perceived level of corruption in the country? Weak – Ranking – 123rd out of 180; Score 31 out of 100 with a higher score indicating more transparency Trend
Source: Transparency International

Integrity Mechanisms

3.2.2   A National Integrity System is a framework where the principle institutions that contribute to integrity, transparency and accountability in a society can address corruption in a systematic way. Does a National Integrity System exist? Yes – Weak – Mechanisms are either rudimentary or poorly enforced.

Source: Transparency International –


Extralegal Payments

Survey Question

SQ 11  How often do companies report that officials and/or companies expect additional payment to “expedite” services or gain business? Very Weak – 52.11% of people are willing to pay extra to get things done.

Source: Enterprise Surveys




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3.3 Efficient Administration


Core Question:  Are quality services and qualified civil servants available to the public through the efficient use of public money free of corruption? No – Weak, systemic corruption continues to hamper government effectiveness.


Size of Government

3.3.1  What is the size of government relative to GDP? 30.3% Weak – Much higher than previous year, reflecting increasing government resources spent on inefficient operations. This is a red flag for property transactions.

Source: Index of Economic Freedom, Heritage Foundation  


Civil Service

3.3.2   What is the quality of the civil service? Score – 42 out of 100 – Very Weak

Source: Global Integrity Report –   


Government Effectiveness

3.3.3   What is the overall effectiveness of the government? Weak – Percentile Ranking – 45 Trend Source: Governance Matters, World Bank 2011,



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In-Country Assessment Information (as of June 2007)

FQ 7. What is the actual experience of practitioners in dealing with the government?

Foreigners face challenges in dealing with the government due to unfamiliarity with the systems and the network of high position government officers. Local legal counsels can be used to overcome such barrier. However, the practice of local legal counsels is questionable because they tend to follow the local culture of gifts giving or wine and dine meetings.

Domestic practitioners use connections to secure entitlements, permits, site plan approvals, and access to the bidding process. Corruption is a prevailing issue and it is considered as part of the culture. It is common for practitioners to be willing to pay extra to shorten the time for each procedure to cut costs in the long run. The practice and profession of permits expeditors exist but it is also unclear how these expeditors get the permits faster than the normal process.

Therefore, it is difficult for a foreign firm to trust local legal counsels and permit expeditors to follow the same set of ethics and laws as the foreign country laws.

Research by Ngoc N. Hoang, March 2013




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