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HANOI - JAPAN'S ambassador to Vietnam on Thursday said his country had suspended new aid loans to Hanoi, citing a major corruption scandal that came to light last month.
The move came after former executives of Pacific Consultants International (PCI) last month admitted in a Japanese court to paying kickbacks to a Vietnamese official overseeing a Tokyo-funded road project.
Ambassador Mitsuo Sakaba told an international donors' meeting in Hanoi that 'we are unable to pledge new yen loans' until both countries work out 'effective and meaningful measures against corruption.' Japan is Vietnam's biggest bilateral donor.
'Following the grave incident, the two governments set up a joint committee to discuss concrete measures to be taken to prevent corruption relating to Japan's ODA (official development assistance) to Vietnam,' he said.
'Until effective and meaningful measures against corruption be worked out through this joint committee, it would be difficult to regain the support from the Japanese public for further assistance to Vietnam, and we are unable to pledge new yen loans.'
Japan last year gave more than a billion dollars in ODA to Vietnam and has been studying several major infrastructure projects, including a new north-south transnational railway and highway and a high-tech industrial park. -- AFP
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