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CZECH ANTI-BRIBE PROPOSAL CALLED  "INEFFECTIVE"
 
PRAGUE - Plans in the pipeline at the Ministry of Interior to deal with corrupt officials in-house have been described as ineffective and unlikely to succeed by Transparency International (TI) and some observers.
 
According to the Prague Business Journal, the only effective way to tackle bribe-taking officials and to restore public confidence in the system, they say, is to set up an independent regulator to investigate allegations.

Meanwhile TI representatives say the future of a proposed amendment to the law on conflicts of interest looks uncertain because politicians have complained it is too strict. Politicians polled by the business paper said that if the legislation could prove effective, they would vote in favor of it.

Results of research carried out over the past few years have shown a growing number of Czechs admitting they pay bribes to officials. In a survey carried out by a Prague-based pollster in March, 37% of those surveyed said they pay bribes, up from a low of 21% in 1999.

Apathy towards bribery is also on the increase, with just 11% of respondents saying in March that bribery was completely unnecessary, compared to 22% in 1998, while 37% said that state offices were the most corrupt institutions in the Czech Republic.

Independent estimates have put the total bribes paid in the Czech Republic every year at some $1.33 billion), or some 2% of the country's Gross Domestic Product (GDP).

The current coalition government promised on coming to power in June 2002 that it would fight corruption.
 
Apart from an amendment to the law on public tenders that is currently in committee in the Czech legislature, the government has been repeatedly criticized by the opposition and the media for not taking action against bribery.
 
An original proposal from Minister of Interior Stanislav Gross to entrap bribe-taking officials was shelved earlier this year after the government deemed it unworkable.
 
VIETNAM AUTO TAX HIKES DRAW FIRE

HANOI - A series of tax hikes aimed at encouraging foreign-invested auto manufacturers in Vietnam to increase local content ratios has left the industry seething and predicting impending closures.
 
Import duties on complete knocked down (CKD) component kits for vehicles with 15 seats or less have been boosted from 25% from the previous 20%, effective immediately.
 
Under the Finance Ministry's "Decision 110," which was signed off on July 25, the rate for vehicles with 16 to 24 seats rises to 15% from 10%, and doubles to 10% for larger capacity vehicles.
 
The government has justified the increases as a means of helping the domestic parts industry grow by forcing manufacturers to raise their local parts content rather than importing them from abroad for assembly in Vietnam.
 
In a separate decision announced in June, Vietnam's special consumption tax (SCT) will rise from its current five percent to 24% on cars with five seats or less from the beginning of next year, with similar gains for larger vehicles.
 
The SCT rates will increase annually until 2007, at which point cars will be taxed at an outlandish 80% and other sized vehicles at between 25% and 50%.
 
To compound the industry's woes, value added tax on CKD imports will also double to 10% across all vehicle categories starting next January.
 
The Vietnam Automobile Manufacturers Association (VAMA), which is made up of 11 foreign-invested companies including Toyota, DaimlerChrysler and Ford, says the tax increases will devastate the industry.
 
The VAMA predicts sales will plunge by 30% to 40% next year as the companies are forced to pass on these added costs to consumers.
 
All vehicles assembled in the country are produced for domestic sale.
 
The government has come under heavy flak for its handling of the issue from VAMA, which only got wind of the tax proposals at the end of January that were originally slated to go into effect ion April.

VAMA members were further incensed by the Ministry of Culture and Information's refusal to let them hold a press conference in Hanoi last week to voice their concern about the tax hikes.
 
"It is a very delicate situation at the moment and the government is clearly sending us a message with this cancellation," said one auto executive.
 
According to industry sources, VAMA members have invested over $500 million in Vietnam to date, excluding related investments in companies supporting the auto industry. 
 
SAUDI ARABIA MAY ENTER WTO EARLY NEXT YEAR

JEDDAH - Saudi Arabia reportedly expects to complete long-running negotiations with the World Trade Organization this year, with entry in early 2004, the country's trade minister has said.
 
"We would like to finish the major steps already by the end of 2003. Very early next year, we should be in. That is our target," Minister Hashem Yamani told Reuters in a recent interview after signing a bilateral trade agreement with European Trade Commissioner Pascal Lamy.

The bilateral deal with the European Union is one of the key steps Saudi Arabia has to take on its path to the WTO, as the 15-nation bloc is the kingdom's main trading partner.

To enter the WTO, a country has to negotiate bilateral deals with current members of the trade body, as well as adopt the WTO's body of legislation.

The Saudis first applied to join the GATT, the WTO's predecessor, in 1993.
 
The WTO committee overseeing Saudi Arabia's entry has not met for almost three years, but Yamani said talks could be held in October.

Under the EU deal, the government has won tariff protection for 165 items in the agriculture, dairy and poultry sectors.

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