Cautious optimism on deal with US as trade talks resume

~ Le Vięt Nam, aujourd'hui. ~
The Vietnam News

Cautious optimism on deal with US as trade talks resume
HANOI - Vietnam and the United States resume trade talks today amid cautious optimism from both sides that a landmark deal could finally be signed. But after years of haggling between the former foes on the market-opening pact, nobody will be staking their life savings on the outcome, least of all those in the business community.

"I am moderately optimistic," said Le Dang Doanh, director of Vietnam's Central Institute for Economic Management, a state think-tank, and an adviser to Premier Phan Van Khai. "It could lead to a signing of a trade agreement if both sides are flexible. I am more optimistic than ever before." Mr Doanh said he understood Vietnam's Trade Minister Vu Khoan had been given "carte blanche" to sign an agreement in Washington with US Trade Representative Charlene Barshefsky if the talks, due to start at working level today, went well.

On Friday, US Ambassador to Vietnam Pete Peterson said he was "somewhat optimistic" the pact could be completed. But he added: "I am no longer predicting outcomes from these talks because we've had a number of disappointments in the past." Vietnam and the United States reached agreement in principle on the comprehensive trade pact last year but Hanoi subsequently backed away from signing the deal, arguing that provisions were unfair. Analysts also believe the pact fell victim to fears among Vietnam's communist leadership that too much exposure to world markets could undermine party control. Both sides have declined to detail sticking points, although Vietnam is known to have objected to a provision requiring annual renegotiation of its NTR status.

The US has made clear it is not willing to "negotiate", only to "clarify" points of the agreement in principle. One well-informed foreign observer said Washington was willing to take up issues not in the initial pact. The source said Ms Barshefsky had eased some of Hanoi's upset over NTR by saying in a May letter inviting Mr Vu Khoan to Washington that the US would be supportive of Hanoi's bid to join the Word Trade Organisation. Asked to forecast the talks' outcome, the foreign observer said: "If I had to put money on it, I would say it's going to go through, but it's going to be messy - both sides have a tendency to agree things, then be unhappy about the outcome." Analysts say concluding the trade deal would give a fillip to dwindling foreign investor confidence in Vietnam and also help clear the way for a historic visit to Hanoi by President Bill Clinton later in the year.

Carl Thayer, a Vietnam expert at the Asia Pacific Centre for Security Studies in Hawaii, said Hanoi was under pressure to complete the agreement with a change of administration coming in Washington and the recent mainland-US trade pact. "There is no room for slippage on Vietnam's part," he said.

REUTERS - July 3, 2000.

Peterson optimistic on trade agreement

HANOI - United States Ambassador Pete Peterson is cautiously optimistic that a long-awaited trade deal with Vietnam can be finalised in talks in Washington next week which are resuming after a 10-month hiatus.

"I am hopeful and somewhat optimistic that there will be completion of the [bilateral] trade agreement [BTA] in this next week of talks," Mr Peterson said. "Obviously, the very fact that Trade Minister Vu Khoan is going back to the United States to work with the American side to complete all the outstanding issues on the BTA is significant and a very good sign." The ambassador hopes the talks with US Trade Representative Charlene Barshefsky will culminate in the actual signing of the agreement, although he added that last year's experience when Vietnamese negotiators initialled a draft agreement only to be overruled by the top leadership made him guarded.

Mr Peterson said: "I am no longer predicting outcomes over this because we have had a number of disappointments in the past." He said Washington was now only interested in an actual signing - or, if necessary, a delay for further talks. "We are not initialling any further document - we have done that once and it didn't lead to a signing," he said. Mr Peterson cautioned that the agreement would only come into force after it had been approved by Congress and warned that its passage was by no means certain. "I can't predict that - I would hope so - but that would require a great deal of work with legislators to have them understand the contents, impact and benefits associated with this agreement," said the ambassador.

Earlier this month, Mr Peterson returned to Washington to campaign against moves in Congress to revoke Vietnam's existing trade privileges. Congressmen say Vietnam's human rights record should disqualify it from the US government credits and export guarantees it enjoys under a presidential waiver. The issue is expected to be put to the vote of the full House of Representatives during or soon after Mr Khoan's visit, but the waiver won a preliminary vote of approval in the House Ways and Means Committee on Wednesday. Mr Peterson said the trade agreement was just one part of the process of normalisation which the two countries launched with the establishment of diplomatic relations five years ago in August.

"The BTA, whether it be signed or not, is not the final say in the process of normalisation between our two countries which will be continued," he said. Mr Peterson declined to comment on the contents of the draft agreement initialled last year.

Agence France Presse - July 1st, 2000.

Vietnam trade min says US trade deal may be signed soon

HANOI - Vietnam's Trade Minister, Vo Khoan, has suggested he may be preparing to sign a final version of a long-awaited bilateral trade agreement with the U.S. when he travels to Washington next week. In an interview with the state-run Vietnam News Agency Friday, Khoan said that during his upcoming meetings with U.S. Trade Representative Charlene Barshefsky, the two officials "will exchange opinions in order to complete the trade deal." He said that a trade agreement will benefit both the U.S. and Vietnam, but needs to reflect the principles of equality and mutual benefit.

Khoan noted that "if both sides recognize that, we will find a satisfactory solution to outstanding issues and will sign the agreement." The U.S and Vietnam started to negotiate terms for a bilateral trade treaty several years ago, shortly after a U.S. trade embargo was lifted in 1994. A provisional agreement was initialed last July in Hanoi. However the Vietnamese government has since declined to sign a final deal. Observers say concerns that the deal will require Vietnam to open its economy to foreign competition have put off several conservative Communist Party leaders. Observers note that Khoan's visit to the U.S. indicates it's likely some kind of political consensus has now been reached. Senior government leaders travel overseas only with permission from the politburo, which is guided by Communist Party Secretary General Le Kha Phieu, the man widely thought to have delayed the deal's completion.

Phieu backs a more leisurely pace of economic reform than observers say the trade deal will demand. The treaty's exact contents have been closely guarded by both sides, but are understood to grant Vietnam's exporters greater access to the U.S. market, while also demanding Hanoi allow U.S. investors greater access to Vietnam. Foreign investment in Vietnam has fallen heavily in recent years because of frustration over falling returns, growing corruption, red tape and high investment costs. Country watchers say a trade deal with the U.S. could help restore confidence among foreign business executives that Hanoi is serious about reforming its unattractive investment climate.

Dow Jones - June 30, 2000.