Justice Delayed After Vietnamese Fishery Disaster

When Taiwan’s Formosa Plastics accepted culpability on June 30 for massive fish fatalities off the coast of central Vietnam, the announcement of a $500 million settlement raised as many questions as it answered. While Prime Minister Nguyen Xuan Phuc recognized the toxic spill as Vietnam’s “most serious” ever environmental disaster, his government’s slow response has come under heavy fire for lacking transparency and favoring foreign over local interests.

After months of official obfuscation and clampdowns on protesters calling for accountability, a government investigation into the crisis revealed that industrial waste laden with toxic levels of cyanide, iron hydroxides, and phenol discharged from Formosa’s local subsidiary steel factory into the sea caused the fish deaths. Officials had initially suggested the mass die-off was triggered by irregular algal blooms, an assessment widely panned by independent scientists and decried by local activists as indication of a government cover-up.

At a press conference, Information Minister Truong Minh Tuan presented the investigation’s findings as the last word on public calls for answers and accountability. In an about face, Formosa’s chairman apologized via video to the Vietnamese people and government, and committed to improve the factory’s waste treatment system to prevent future spills. When news of the fish deaths first broke in April, a Formosa executive was quoted as saying that Vietnam must choose between catching fish and developing a modern steel industry.

Economists and environmentalists, however, raised critical questions over how Formosa representatives and government officials arrived at the $500 million figure, which they suggested was too low considering the scale of the environmental damage, and how the funds would be distributed for rehabilitation purposes. Officials said only that some funds would be used to train affected fishermen in other vocations, presumably factory work. Formosa plans to expand its current $10.5 billion factory to $28.5 billion, which if completed would make it Vietnam’s largest foreign industrial investment.

“How long will it take to restore the sea environment: one year, two years or 70 years? The $500 million sum may look large at first, but when we look at the task of dealing with and solving the effects of this disaster, was this amount arrived at logically or not?” wrote respected economist Pham Chi Lan on the independent Bauxite Vietnam blog site. “We should not allow Formosa to just pay the money and rub their hands saying ‘that’s it’ Relevant government bodies must monitor to make sure Formosa puts its commitments into action.”

Instead, authorities appeared to block the potential for any outside legal challenge to the opaque settlement. The day after the investigation’s findings were announced, officials indefinitely postponed enactment of a new penal code scheduled to come into force on July 1 due to over 100 “errors” in the drafting process. The new code’s clause 2 allowed for the first time under Vietnamese law for commercial entities to face criminal prosecution; clause 235 allowed for criminal charges to be filed by individuals in cases of “environmental pollution.”

Activist lawyers linked the postponement directly to the settlement. “The Vietnamese government has hastily postponed the new Penal Code’s enactment so Formosa won’t be subject to [its] disadvantageous clauses,” wrote human rights lawyer and former political prisoner Le Cong Dinh on a local-language blog. “Frankly, the regime loses more and more of its legitimacy every day when it resorts to all means to protect a foreign business without bothering to hide the fact that by so doing it stands opposed to the whole people of Vietnam.”

The code, widely viewed as a progressive step toward establishing more rule of law in Vietnam’s Communist Party-dominated society, was a legacy of outgoing Prime Minister Nguyen Tan Dung’s reformist administration. Its indefinite suspension has raised questions about whether Phuc’s newly installed government intends to strip the code altogether of provisions that would have allowed citizens to legally challenge the government and private companies in local courts, including for unlawful environmental degradation.

While Vietnam’s cheap labor and improved infrastructure have lured a growing number of global manufacturers, including substantial investments from Canon, LG, and Samsung, comparatively lax environmental standards have also no doubt been a factor. Vietnam would be required to improve those standards, including through stronger laws, as a signatory to the U.S.-led Trans-Pacific Partnership trade pact. But the deal’s uncertain prospects in a volatile U.S. election season may also have factored in Phuc’s decision to postpone the new code’s enactment.

That doesn’t necessarily mean that Formosa’s $500 million settlement will be the last word on the environmental disaster. In mid-June, Taiwanese lawmakers called on President Tsai Ing-wen’s government to investigate the matter in response to claims that Formosa’s actions threatened her policy of promoting investment in Southeast Asia to lessen the island state’s dependence on China. If the probe leads to legal action, Vietnamese activists have already said over social media they would lend their support and provide evidence to any lawsuit filed in Taiwanese courts.