L.A. firms warily eye Vietnam trade possibilities; prospect looms of U.S. ending 16-year-old embargo.

Trade with Vietnam is currently forbidden by U.S. law but a handful of Los Angeles companies are putting out feelers in anticipation that Washington may soon lift its 16-year-old embargo, according to local lawyers and bankers.

Giants like Unocal Corp. and Dole Food Co. have publicly professed interest in possible future deals with the oil- and seafood-rich nation of 70 million, where wages are even lower than China's famously low rate.

"There are companies in Los Angeles County that want to do business in Vietnam," asserted Hillel Cohn, an attorney with law firm Graham & James in L.A. One client, which he would not name, is a Fortune 500 company interested in energy development there, he said.

Several smaller companies have already signed letters of intent with Vietnamese counterparts that lack only the final signatures to become enforceable.

"I am aware of two companies (in L.A.) that have executed these letters of intent," said an L.A.-based Asian banker who asked not to be named. Contact is merited, he said, even though President Bush or President-elect Clinton may not normalize relations for months or years.

"We're interested. We've been tracking developments there," said Unocal spokesman Barry Lane. The $11 billion-in-annual-revenues oil company hasn't held talks with the Vietnamese government, said Lane. But it would seek to joint venture with Vietnam -- once relations are begun -- along the lines of Unocal's existing drilling and exploration projects offshore Indonesia and Thailand.

Attorney John Forry of Morgan, Lewis & Bockius in L.A. said he even knew of resort-development interest.

"There are some very beautiful sites in Vietnam near Cam Ranh Bay where you could build hotels, resorts (like) those in Hawaii or on the Mexican Coast," explained Forry, who runs his firm's Asian tax practice.

L.A.-area representatives from oil-drilling outfits Santa Fe International Corp. in Alhambra and Hydril Co. in L.A., along with private investigations firm Kroll & Associates and other businesses and banks, gathered in L.A. Oct. 1 to hear a Standard Chartered Bank economist describe Vietnam's oft-announced growing hunger for foreign investment and economic liberalization.

"If the oil industry in Vietnam became quite active, we obviously would like to become involved," said Santa Fe spokesman John Mika.

"They're all getting ready to trade," said one source who attended the talk.

But other business representatives who attended either declined to return phone calls or to speak on the record. Indeed, the majority of players contacted were extremely press shy.

Some are especially wary of public scorn for courting a bitter former enemy. "They possibly would be subject to public pressure to refrain (from striking deals)," said Forry.

Some worry that comments would tip their hands to competitors, sources said. Others fear reprisals from anti-communist Vietnamese in the Southland who, according to newspaper accounts, have threatened those renewing commercial contact.

U.S. relations with the government of Vietnam, successor to America's one-time bitter communist foe in the Vietnam War, have warmed this year. Last month, a high-level U.S. congressional delegation made progress on POW-MIA cases, a prime obstacle to ending the embargo.

Despite the political risks, some entrepreneurs do more than just ask questions.

"I'm aware of companies that have bypassed the embargo by using front companies in Hong Kong and Singapore," said Vietnamese-American attorney Don Dao in Newport Beach, who scouts opportunities for Southland companies.

Admittedly, L.A. businesses still are not as interested in initiating Vietnamese trade as they are in many Asian countries, said sources. The nation's hard currency reserves are quite small.

Oil is the clearest draw, with estimated proved reserves of 500 million barrels, roughly equal to Turkey.

Yet L.A.-based Atlantic Richfield Co. is only mildly interested, said Arco sources. Arco officials met with a Vietnamese delegation last month.

"It was more of a get-acquainted meeting than anything else," said Arco spokesman Al Greenstein. He said the country "is not at the top of our list," but exploration or production there would not be ruled out.

"Our geologists only find it moderately interesting," said an international Arco official who asked not to be named. "The bulk of the good exploration blocks have already gone to the Japanese and the Europeans, we've heard," he added.

Indeed, Japan and Europe are years ahead of the Americans, unfettered by a trade embargo.

Japan's bilateral trade with Vietnam is running at $900 million a year, and Taiwan, Hong Kong, France and the Netherlands have all invested more there than Japan, the L.A. Times reported recently.