VZCZCXRO1574
PP RUEHDT RUEHPB
DE RUEHHM #0872/01 2330948
ZNR UUUUU ZZH
P 210948Z AUG 07
FM AMCONSUL HO CHI MINH CITY
TO RUEHC/SECSTATE WASHDC PRIORITY 3017
INFO RUEHHI/AMEMBASSY HANOI PRIORITY 2130
RUCNARF/ASEAN REGIONAL FORUM COLLECTIVE
RUEHHM/AMCONSUL HO CHI MINH CITY 3222

UNCLAS SECTION 01 OF 02 HO CHI MINH CITY 000872 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
EAP/MLS FOR BRETT BLACKSHAW 
 
E.O. 12958: N/A 
TAGS: PHUM SOCI ECON PREL PGOV VM
SUBJECT: FROM IDEOLOGY CZAR TO REFORM ADVOCATE 
 
REF: HCMC 805 AND PREVIOUS 
 
HO CHI MIN 00000872  001.4 OF 002 
 
 
¶1. (SBU) SUMMARY: On August 16, People's Council Chairwoman Pham 
Phuong Thao and CG discussed issues ranging from the city's 
plans for attracting private investment to meet much of the 
city's massive infrastructure requirements to the social and 
political challenges posed by the widening economic disparity 
among the residents of this booming city.  Over the course of 
the one-hour meeting, Chairwoman Thao, whose resume includes a 
stint as the chief of Communist ideology for HCMC, began rather 
stiffly but eventually spoke earnestly of the need to make local 
government more responsive to people's needs and her wish that 
the national government would act more swiftly on economic 
liberalization.  END SUMMARY. 
 
WARMING TO CHANGE 
----------------- 
¶2. (SBU) After listening to a fairly typical recitation of GVN 
policies and goals in HCMC, CG Fairfax used examples from his 
past work on urban redevelopment in the U.S. as well as from his 
experiences in other transition economies to draw out Chairwoman 
Thao on how the People's Council (which is analogous to a City 
Council) is facing the challenges that inevitably accompany 
rapid change. 
 
¶3. (SBU) While Thao was initially quite guarded in her 
responses, as she warmed to the topic she said that while HCMC 
is dynamic and young, like any youth, it demands a great deal of 
attention.  In particular, Thao believes the HCMC government 
cannot afford to become complacent due to its past successes and 
must instead learn to respond to increasing pressure and public 
demands, citing as examples a recent survey of city residents 
conducted to measure satisfaction with public services and the 
fact that her office now has a hotline to receive "a great many" 
complaints from residents every day.  At another point in the 
conversation, she also expressed her desire for the GVN to move 
forward more quickly on economic liberalization, citing a new 
law on public-private partnership projects as well as 
administrative reforms as key areas in need of rapid action. 
Having (mildly) criticized the GVN for slow action on reform, 
Thao also admitted that while the People's Council has made 
administrative reforms a key priority for the past two years, 
progress has thus far proved elusive. 
 
¶4. (SBU) Asked about the economic "winners and losers" in HCMC's 
rapid transformation in general and about those HCMC residents 
who took part in recent land rights protests (reftels) in 
particular, Thao readily acknowledged that a number of HCMC 
residents have been left behind as the overall economy has moved 
forward.  On the land issue, she explained that hundreds of 
thousands of HCMC residents have been affected by the city's 
urban development projects and that not all of them were able to 
find replacement housing.  While she started with the line that 
"everyone must make sacrifices for the sake of development and 
progress," she also acknowledged that those sacrifices have not 
been spread evenly. 
 
¶5. (SBU) Thao explained that while some of the people who have 
been displaced have been able to use their compensation money to 
acquire new residences and even to open successful businesses, 
others have been less fortunate.  She said that in some cases it 
was a question of timing while in others projects should have 
been managed better.  While she believes that a large majority 
of residents in redeveloped areas wind up better off than they 
were before, she admitted that tens of thousands out of the few 
hundred thousand households that have been displaced nonetheless 
wound up much worse off.  She described a two-pronged approach 
to address this problem.  First, the city is moving to 
compensate those unfairly disadvantaged in the past by providing 
new housing.  She estimated 4,700 units would be made available 
in 2007 alone and she hopes for a larger number in 2008. 
Second, to avoid creating new problems the city has adopted 
policies on major development projects under which developers -- 
public and private -- must mitigate the impact of their projects 
on local residents and the environment. 
 
CASH TO TAKE OUT THE TRASH 
-------------------------- 
¶6.  (U) Looking to the future, Thao said the government's 
multi-year urban infrastructure plan included projects to 
renovate HCMC's transportation, education and health care 
networks.  She also explained her conviction that the key to the 
city's future economic success is mobilizing private sector 
expertise and private capital to complete many of these public 
infrastructure projects.  Thao hoped the CG would continue to 
help HCMC attract more U.S. expertise and funding for urban 
development projects, citing an American investment in a new 
solid waste processing facility as a huge success and model for 
future projects.  While not the largest of the city's six major 
dumps, she explained that this single new American investment 
 
HO CHI MIN 00000872  002.4 OF 002 
 
 
will soon accommodate one half of the city's urban waste (3,000 
tons a day) in a state of the art facility that incorporates 
advanced recycling, composting and environmental projection 
technologies -- all of it built without a dime of public money. 
(Comment: We believe she was referring to a facility built by 
California Waste Management that is operated on a commercial 
basis with tipping fees providing its income stream.) 
 
¶7. (U) Noting that nothing builds success like success, the CG 
expressed his hope that the city would help to ensure the 
success of recently formed private infrastructure investment 
funds by working closely with them.  He also volunteered to 
return for a future meeting accompanied by commercial experts so 
that they could discuss specific infrastructure projects that 
the city believes are suitable for private or PPP development. 
 
¶8.  (U) This cable was coordinated with Embassy Hanoi.FAIRFAX