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Bulletins and News Discussion from May 13th to May 19th, 2024 - The Blazing Furnace - COTW: Vietnam

An image of a Central Committee meeting in Hanoi. Image taken from this article.

General Secretary Nguyễn Phú Trọng implemented an anti-corruption campaign in 2016 called "blazing furnace" in shorthand. Since then, the fire has ripped through both politicians and businesses, up to even the Presidency. Nearly 200,000 party members, 36 Central Committee members, and 50 police/military generals have been disciplined since the initiative began. In 2018, Dinh La Thang, the former party chief of Ho Chi Minh City, became the first sitting Politburo member to be criminally charged, and was sentenced to 30 years in prison. In 2023, President Nguyễn Xuân Phúc was implicated in a corruption scandal and resigned. He was replaced by Võ Văn Thưởng, who was then also caught in a corruption scandal a year later in March 2024, making him the shortest serving President in Vietnamese history. The Presidency is current headed by Võ Thị Ánh Xuân while they find a new President; she also took that role in 2023.

The ousted leaders tend to also be part of the more West-friendly, technocratic faction inside Vietnam, either reflecting how these people also tend to be more easily corrupted, or how the Communist Party is slowly moving away from a foreign policy which allies itself with the West (as Vietnam has comprehensive strategic partnerships with several Western countries), or some combination. Of course, this shouldn't be overstated - Vietnam has maintained a close friendship with China for years, and both incumbent leaders are intimately familiar with anti-corruption campaigns and how and why they must be conducted in order to deliver maximum public benefit.

America clearly desires Vietnam to pick their side, because America strongly desires another vassal state in East Asia like the Philippines, South Korea, and Japan to further encircle and isolate China. And so the headlines and commentary of Western state propaganda like Radio Free Asia, the BBC, WaPo, Business Insider, etc reveal their increasing annoyance with Vietnam's government. They often couch this in the standard "objective" economics language); about how removing leaders who foreign investors were reassured by might mean economic pain for Vietnam ahead. As Bhadrakumar noted in 2023, perhaps the BBC revealed their intentions the best:

Reading Vietnamese politics is always difficult — the Communist Party makes its decisions behind closed doors. But hard-line General Secretary Nguyen Phu Trong, who was given an unprecedented third term at last year’s party congress, appears to be consolidating his authority by ousting senior officials seen as more pro-Western and pro-business. Officially this is all happening in the name of fighting corruption,.. but it’s indicative of a power struggle at the top of the party… the likely rise now of more security-focused officials to the top of the party will be bad news.

Even a quick google search right now will show a bunch of articles by clearly nervous Westerners: Why Vietnam’s Escalating Anti-Corruption Campaign Might Backfire because, as we all know, only authoritarian regimes are vulnerable to things like public opinion and discontent, while Western "democracies" are insulated from such petty phenomena. Leaders here can have disapproval ratings of 60-70% and not even the slightest consequence will happen to them - a real sign of democratic freedom and justice over those primitive regimes in the East! Or, take: ‘Blazing Furnace’ Turns Vietnam Into Another Chinese Province; China turning both Russia and Vietnam into their provinces in just two years was a real diplomatic masterclass. Or, back in 2022: Vietnam's 'blazing furnace' crackdown burns $40 bln off stocks. Not the stocks! Anything but the stocks!

If your actions as a leader are pissing off Bloomberg, you are going in the right direction.

The COTW (Country of the Week) label is designed to spur discussion and debate about a specific country every week in order to help the community gain greater understanding of the domestic situation of often-understudied nations. If you've wanted to talk about the country or share your experiences, but have never found a relevant place to do so, now is your chance! However, don't worry - this is still a general news megathread where you can post about ongoing events from any country.

The Country of the Week is Vietnam! Feel free to chime in with books, essays, longform articles, even stories and anecdotes or rants. More detail here.

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  • Germany and Sweden Express Caution on Tariffs on Chinese EVs

    "The politicians are now calling for trade restrictions on Chinese car manufacturers. This is an absurdity," BMW CEO Zipse said.

    German Chancellor Olaf Scholz and Swedish Prime Minister Ulf Kristersson have cautioned against tariffs on Chinese electric vehicles (EVs) following Washington's announcement of hefty levies.

    Scholz and Kristersson expressed reservations about possible European tariffs on Chinese EVs when asked at a press conference whether they support the EU to follow suit.

    On Tuesday, the United States announced new tariffs on a variety of imports from China, including EVs, in addition to existing tariffs under Section 301. The additional levy will raise tariffs on Chinese EV imports to 100 percent this year. Last October, the European Commission launched an anti-subsidy investigation into the imports of EVs from China.

    "50 percent of electric car imports from China come from Western brands that produce cars there and, in that regard, that's maybe a difference compared to North America. There is an exchange from both sides. European and even some North American manufacturers are successful on the Chinese market, and we have to take that into account," said Scholz, stressing the importance of trade between the West and China.

    "When it comes to import duties, I think that we (Sweden and Germany) essentially have a consensus that it is a bad idea to start dismantling global trade. A broader trade war where we stop each other's products is, in principle, not the future for large industrialized countries like Germany and Sweden," said Kristersson.

    Around 20 percent of all-electric cars sold across the EU last year, or 300,000 units, were made in China. More than half of them come from Western carmakers, such as Tesla, Dacia and BMW, which produce them in China for export. Major German carmakers also signaled opposition to the possible tariff increases.

    "The politicians are now calling for trade restrictions on Chinese car manufacturers. This is an absurdity," BMW CEO Oliver Zipse told German media Frankfurter Allgemeine Zeitung.

    Proposing restrictions on EVs shows a sign of short-sightedness, as it risks incurring countermeasures from the trading partner, leading to a more difficult availability of essential raw materials for European EVs, said Zipse, warning that European carmakers should refrain from repeating past mistakes in the auto industry.

    "The European market previously feared the Japanese flooding with cheap cars, then the Korean. And now it is the Chinese," he said, stressing that the European market is not "flooded" with cheap Chinese electric cars, which only have a share of 0.8 percent in Germany.

    Zipse warned against superficial statistics. For example, around 20 percent of EVs in Europe were imported from China last year, while "more than half did not come from Chinese companies at all."

    Regarding the EU's anti-subsidy investigation on Chinese EVs, Hildegard Mueller, president of the German Association of the Automotive Industry, said that new tariffs and barriers were not the right way forward.

    "We believe that building up new tariffs and sliding into mutual protectionism is the wrong way to go. Rather, we need to talk to each other so that it is equally possible for companies in both countries to approach mutually, produce there and sell there," he pointed out.

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