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The Vietnam News

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Clock ticking on US-Vietnam trade

HANOI - Vietnam is running out of time to sign a delayed trade agreement with the United States and tap the pact's economic benefits, the U.S. ambassador to Hanoi said on Friday.
Pete Peterson told Reuters Hanoi needed to sign the accord quickly so the U.S. Congress could approve it before Washington's political agenda became dominated by next year's presidential election.

Analysts have said the agreement could be sidelined until 2001 or beyond if Vietnam missed that opportunity. Peterson declined to comment on why Hanoi had balked at signing the pact, and said it was unclear when the country's leadership would be ready to put pen to paper. The former enemies in the Vietnam War reached agreement in principle on the pact in July, and U.S. officials had expected it would be co-signed and enacted by the year-end.

But sources say the elite Communist Party politburo is still debating the merits of the pact. The agreement will open Vietnam's economy but also give it access to the U.S. market at preferential tariffs, something formerly called Most Favoured Nation (MFN) trade status.
Peterson said the best-possible scenario would be for the two sides to sign the pact before Congress adjourned this year and have it heard and approved early next year. Congress is scheduled to adjourn on October 29, although its session might extend into November, he said.

``Even if we are unable to go through the Congressional approval process this year, this would put it at the front of the agenda in 2000,'' Peterson said in an interview.
``If that were the case, then I think it is very feasible that Congress would take it up and act by say mid-February, before the presidential election heats up.''

Analysts expect the deal to take several weeks to move through Congress. Vietnam's National Assembly also needs to ratify the pact, but once given the green light by the politburo that would be a formality.

U.S. WANTED HANOI TO SIGN AT APEC

Peterson said the United States had wanted the Vietnamese to sign the deal at last September's summit of the Asia Pacific Economic Cooperation (APEC) forum in New Zealand.

``We wanted to showcase the pact, not so much for us, but for the Vietnamese. They opted not to, and as a result we are just waiting for them to go through the debate process to determine their next steps,'' Peterson said.
Peterson said he did not believe Vietnam wanted to renegotiate parts of the pact.

But he said it was ``disconcerting'' Hanoi had yet to decide whether to extend a waiver on a 50 percent surcharge on U.S. goods imported to Vietnam. Hanoi passed a law in 1998 that required the government to hike tariffs by 50 percent on goods from nations that did not accord MFN trade status to Vietnam. Vietnam this year waived imposition of that tariff hike on U.S. imports for 1999 because of the trade talks.

``That is a question that has to be resolved, and we have asked for a response,'' Peterson said.

Reuters - October 15, 1999.