End Sought to U.S. Embargo on Vietnam : Trade: Companies say government rules against commercial dealings with Hanoi give other countries a lock on a potentially lucrative market.

American executives say the United States is losing its second war in Vietnam, not to communist guerrillas but to business competitors from Western Europe and Asia.

Eager to revive an economy that is in shambles, Vietnam has opened itself to trade and investment from the non-communist world, including the United States.

The Japanese, French, British, Dutch and others are coming in, hoping to profit from Vietnam’s rich natural resources and the least expensive labor costs in Southeast Asia.

But a tough U.S. trade embargo prevents Americans from entering the market, and executives in recent months have become increasingly critical of the ban. Trade with Cambodia also is prohibited.

Much of the anti-embargo push has come from Americans in Asia. But pressure is also intensifying in Washington, where business lobbyists are finding allies among members of Congress, veterans groups and humanitarian organizations.

“It’s become less unfashionable for big American companies to come forward for lifting the embargo,” said Sesto Vecchi, an American attorney who has made a number of trips to Vietnam and represents some U.S. business interests. “The ingredients are there for an effective pressure group.”

Last April, the Asia-Pacific Council of American Chambers of Commerce called for the “immediate removal of restrictions on U.S. trade and investment with Vietnam.” The umbrella group, which represents 19 chambers, said the embargo “severely impacts on American competitiveness in the region.”

Speaking recently to a seminar of the American Chamber of Commerce in Thailand, Australian businessman Raymond Eaton told non-Americans in the audience: “Do your utmost to capitalize on the inability of American companies to compete against you--this is a golden opportunity that is being made available.”

The Chamber says about 100 foreign firms have signed joint-venture agreements with the Vietnamese valued at $859 million. Oil and gas exploration concessions have been given to companies from Great Britain, the Netherlands, Sweden, Canada, India and Belgium.

Japan has become Vietnam’s second-largest trading partner after the Soviet Union. Despite a tough anti-communist political stance, Singapore does a low-key business with the Vietnamese worth $200 million annually.

“Getting in early, getting in on the ground floor, are really key to long-term success,” the chairman of Esso Standard Thailand Limited, Roy Weiland, told the seminar. He said the Vietnamese were holding some oil concessions for American companies but probably wouldn’t wait much longer.

Other American executives complained of losing other business as a result of the embargo. Some shippers seeking insurance, for example, are switching from American companies--because they could not include Vietnam and Cambodia as part of their coverage.

The embargo, imposed on North Vietnam in 1964, was extended to the entire country after communist forces seized Saigon 15 years ago.