NEED TO KNOW

Vietnam: No Bold Reforms For New PM

Sometimes you need a steady hand on the tiller. Or that’s what Vietnam’s politburo is thinking.

With the confirmation of Nguyen Xuan Phuc as its new prime minister by the country’s rubber stamp parliament on Thursday, Vietnam is replacing a bold and charismatic leader with a slow-and-steady technocrat.

That means Hanoi is betting on stability, rather than boldness, amid soaring public debt, a severe budget deficit and an economic slowdown due to low oil prices and a drought in the Mekong Delta rice bowl. And that’s before taking into account the escalating tension with Beijing over disputed territory in the South China Sea.

So what to expect?

The country will stay the course on economic reforms – as the government emphasized in January, when outgoing PM Nguyen Tan Dung lost a bid for the top post in the all-powerful Communist Party. But Phuc’s selection will also likely mean no progress on human rights issues and no big bang economic changes.

On human rights, it’s not likely that Phuc will deviate from ongoing efforts to quell dissent like the imprisonment of seven bloggers and activists in March.

Meanwhile, Phuc’s economic moves are likely to be geared toward protecting the party first and foremost.

“They want stability for regime security,” University of Oregon political scientist Tuong Vu told Bloomberg. Meaning: the politburo wants to make sure the party remains in charge. “That does not create an open environment for more reforms or faster reforms.”

Given the crisis that Vietnam faces, that prescription may be problematic. It’s a little like asking Phuc, the new PM, to do less of what worked for his predecessor and more of what didn’t.

The big knock against Dung was that Vietnam’s state-owned enterprises racked up massive losses and huge debts during his 10 years as premier – while the country’s gross domestic product nearly quadrupled to $190 billion in 2015 from around $50 billion in 2006. But the answer to that problem is accelerating reforms by selling those bloated state-owned companies, economists argue.

On the other hand, Dung’s biggest achievement (arguably) is probably safe. Dung is credited with strengthening Vietnam’s ties with the US and pushing forward the Trans-Pacific Partnership (TPP) – a free trade pact covering the US and 12 Pacific Rim nations that Hanoi is expected to sign in July.

Vietnam reportedly has the most to gain from the pact — which will give its firms preferential access to the US textiles and apparel market and add 10 percent to its GDP by 2030. (The same study shows the US economy will get a 0.4 percent boost).

And the ongoing spat with China puts more impetus behind the deal, as the South China Sea dispute makes various smaller Asian nations keen to ally with the US.

As a result, when Obama visits Vietnam next month, “we can expect the new leaders to look for ways to boost their ties with the United States to balance relations with an increasingly assertive China,” says Murray Hiebert of the Center for Strategic and International Studies.

---

WANT TO KNOW

Kerry Fights For Iraq’s Embattled PM

In the latest chapter of America’s “you break it, you bought it” adventures in Iraq, US Secretary of State John Kerry is stumping for Iraqi Prime Minister Haider al-Abadi in Baghdad today – hoping to help him stave off moves for his ouster.

Iraq’s economy is in a shambles due to a combination of cronyism and low oil prices, and the fight against IS and internal squabbling have hamstrung the PM’s sweeping reforms intended to slash government corruption.

The bad news for Washington: The political crisis threatens to undermine Iraq’s fight against IS, too.

---

France: Revolutionary Prostitution Law

Lawmakers in France made paying for sex – rather than selling it – illegal. Hailed as a “revolutionary” move by activists, the law will penalize clients who hire prostitutes $1700 to $4300 and require them to attend “prostitution awareness” courses.

Northern Ireland, Canada, Sweden, Norway and Iceland already have similar laws. At least one study of Sweden’s law shows it reduced street prostitution by more than half since 1995.

But not everybody thinks paying for sex is such a bad thing. Sex workers in Germany say any laws that push prostitution underground make the profession more dangerous. Even in Sweden, sex worker advocates say johns are so scared of getting busted that women jump into cars too quickly to assess whether the client poses a threat.

---

Panama Papers Hit Cameron and Putin

It was a study in contrasts.

British Prime Minister David Cameron and Russian President Vladimir Putin are the latest big scalps from the so-called “Panama Papers.” But they employed radically different strategies to deal with the possible political fallout.

On the hook for around $2 billion in offshore transactions by his close associates, Putin said the whole thing was an American plot concocted to destabilize Russia. Not to mention his name was not on the list. (He mentioned that, too).

Cameron – who finally quit dodging questions about an offshore trust started by his late father on Thursday – decided to come clean. “Yes, I had shares in a secret offshore trust,” he said in effect. “But I didn’t inhale.” (OK, what he really said was that he only made around $50,000 from the shares, and he sold them before he became PM). Trouble is, Cameron has been banging on about tax evasion. Awkward.

---

DISCOVERIES

Big Oil Spends $115M Per Year Fighting Greens

Big oil spends around $115 million a year lobbying against policies that would fight climate change by limiting the use of fossil fuels, according to a new report.

That’s peanuts compared to the annual earnings of, say, ExxonMobil – which spent $27 million fighting green policies and earned $16 billion last year. But it’s more than 20 times the amount that climate-advocacy groups were able to marshal.

Some other benchmarks: The National Rifle Association spent around $3.6 million on lobbying in 2015 and the tobacco industry spent around $20 million, while the insurance industry spent more than $150 million.

The biggest anti-green spender was the American Petroleum Institute (API) – which represents companies involved in “all aspects of America’s oil and natural gas industry.” API spent $65 million lobbying against policies designed to fight climate change, the report says.

Thanks for reading, and have a great weekend!

The DailyChatter editorial staff sends you best wishes for a wonderful day. We welcome your comments and your suggestions for improving DailyChatter. Write to us at [email protected].

— Compiled and written by Jason Overdorf