Problems With Current U.S. Policy.

U.S. officials argue that the responsibility for improving relations lies largely with Vietnam. But even after signing the bilateral trade agreement, many obstacles remain on the American side. Why, for instance, has the U.S. granted permanent NTR to China while denying it to Vietnam? Why are Vietnam and neighboring Laos denied NTR status, along with Afghanistan, Cuba, North Korea, and Serbia? The answer lies in a toxic cocktail of geopolitics, business pressure, and die-hard domestic opposition.

The "paramount" American interest in Vietnam, according to Secretary of Defense William Cohen, remains recovering the bodies of U.S. soldiers listed as missing in action (MIA) during the war. Working in cooperation with Vietnamese authorities, the U.S. has spent upwards of $75 million per year since 1988 to identify fewer than 600 MIA remains, with around 1,500 Americans still unaccounted-for. Well-organized veterans' groups have combined the MIA issue with that of American prisoners of war (POWs) to create an insidious myth justifying continued U.S. hostility toward Vietnam.

Despite the publicity it receives, the POW/MIA linkage has no basis in fact. U.S. Ambassador Douglas P. ("Pete") Peterson, himself a former POW, confirms that all allegations have been exhaustively investigated without uncovering any evidence of POWs. There are no POWs alive in Southeast Asia; all known prisoners were released soon after the end of the war. Meanwhile, at least 400,000 Vietnamese from both sides of the conflict are still missing. Despite the inequality and even racism inherent in searching only for American remains, observers from President Clinton on down confirm that Vietnam's cooperation with the MIA program has been excellent.

Another barrier to treating Vietnam as a normal country has been the influence of reactionary Vietnamese-American (Viet kieu) politics. Like their Miami Cuban counterparts, former South Vietnamese soldiers and officials refuse to accept current political realities, preferring to live in an imagined past. Although they do not represent the majority of Vietnamese-Americans, extremist Viet kieu groups wield a disproportionate voice in U.S. policy and at times resort to threats and even violence to silence others.

Despite widespread opposition from conservatives, veterans, and Vietnamese-Americans, Ambassador Peterson arrived in Hanoi in 1997 with an explicitly protrade agenda. Since providing direct assistance was deemed politically impossible, the U.S. is using free trade to invest its way out of history and bring prosperity to Vietnam.

Vietnamese enthusiasm for open markets, however, dropped significantly with the onset of the Asian economic crisis, during which economic isolation and restrictions on capital movements helped to shield Vietnam from the worst effects of the meltdown. Officials in Hanoi look more and more enviously at Chinas economic reform policies, encouraging some investment while ultimately holding the economic reins and maintaining tight political control. In contrast, the U.S. model of free trade and capital liberalization seems distinctly less attractive.

Negotiations on a U.S.-Vietnam trade agreement dragged on far beyond Ambassador Peterson's original schedule. The negotiators finally arrived at an "agreement in principle" in July 1999, but the Vietnamese participants apparently acted under intense U.S. pressure and without full support from their superiors. A year of renegotiations ensued before a final agreement was signed. The accord includes specific language on import quotas and tariffs, financial services, telecommunications, agriculture, and intellectual property rights--topics more comprehensive and far-reaching than any other U.S. bilateral trade agreement. Overall, tariffs on both sides will drop from an average of 40% to 3%, though reductions will be phased in over a period of years. Vietnamese negotiators won a few concessions from the U.S. in the final round of negotiations, particularly over telecommunications.

Hanoi's hesitation on the trade agreement should not be read as mere obstructionism. Underneath the political rhetoric percolated an intense controversy within the government over the impact of globalization and the social consequences of economic reform. Debates among the government, Communist Party, and National Assembly have been drawn-out and significant, though their exact contours are hard to determine. As with the USTR and the WTO, Vietnamese economic policymaking happens behind closed doors. But some worries are clear. Communist Party leaders view unrest in the former Soviet Union and China with alarm and are determined to prevent instability at home, both for their own interests and for national survival. In light of the history of U.S. hypocrisy and broken promises, Hanoi is understandably suspicious of new offers coming from Washington.

Part of the delay in accepting the trade agreement was also rooted in political culture. Vietnam's single-party system operates by consensus, and even one strong dissenting voice can delay agreement. This methodical, conservative style of work invariably conflicts with the American desire for fast results and measurable progress. (One Vietnamese official recently told a group of visitors, "`Yes' does not necessarily mean `yes.'") Successive American delegations arrive in Vietnam with high hopes--after all, the Vietnamese are so capable and hospitable--only to find their prospects dashed by roadblocks and delays. Where the Vietnamese favor caution and prudence, American observers read ignorance and incompetence, often mistakenly. The Vietnamese can be extremely skillful negotiators, but they operate on their own schedule. In the case of the trade agreement, Hanoi agreed to move only after the congressional passage of the China PNTR legislation in May 2000 and signs that the U.S. was willing to renegotiate.

Key Problems

* U.S. policy continues to be dominated by cold war anticommunism and the POW/MIA myth.

* The main alternative to this policy, a trade liberalization-focused agenda, fails to satisfy legitimate Vietnamese concerns over the social consequences of economic changes.

* Trapped in their respective worldviews, U.S. and Vietnamese officials frequently fail to communicate effectively.

Andrew Wells-Dang ([e-mail]) is the program director at the Asia Pacific Center for Justice and Peace.