Cambodia, Vietnam Hail U.S. Policy Shift : Asia: Region’s leaders are surprised by the decision. A critical China vows to keep up aid to the Communist Khmer Rouge.

Vietnam and Cambodia on Thursday hailed the U.S. decision to withdraw its support of the three-party coalition fighting the Cambodian government, but the leader of the coalition charged the Americans had committed a “very grave injustice.”

At the same time, China, the principal provider of weapons for the Khmer Rouge faction of the coalition, criticized the U.S. decision and said it will continue to supply the Khmer Rouge.

Secretary of State James A. Baker III announced the new U.S. position Wednesday and appeared to have taken governments in Asia by surprise. Chinese officials said in Beijing that their government had not been advised in advance.

Baker said the United States plans three steps: to withdraw its support for the resistance coalition, which occupies Cambodia’s seat at the United Nations; to open a dialogue with Vietnam on a settlement in Cambodia, and to permit humanitarian aid for Cambodia.

Diplomatic sources agreed that the most significant of the three steps is the offer to begin talking with Vietnam, which the United States has shunned diplomatically since the end of the Vietnam War in 1975. Talks are to be taken up with the Vietnamese mission to the United Nations.

These sources said that despite Washington’s denials that the talks will lead to a normalization of diplomatic relations between the United States and Vietnam, such a possibility cannot be ruled out.

“Once you start talking about Cambodia,” one Bangkok-based diplomat said, “you start talking about normalization in the context of a Cambodian settlement, which the Administration has said all along. It breaks that intangible thing, which kept the United States on the wall so long over Vietnam.”

In Hanoi, the Vietnamese government welcomed Baker’s statement and said it was prepared to talk with the Bush Administration.

“Vietnam has stated on several occasions that it wants to see soon a fair and rational political solution to the Cambodian problem, on the basis of respect for the national rights of Cambodia and of peace and lasting stability for the whole of Southeast Asia,” Foreign Minister Nguyen Co Thach said in a statement distributed by the Vietnamese press agency. “Vietnam is ready to negotiate with all countries affected by the Cambodian problem.”

In Phnom Penh, the government of Prime Minister Hun Sen hailed Baker’s announcement as a constructive step in the peace process.

“We consider it a step toward paving the way for a settlement in Cambodia and maybe for good understanding between the two countries,” Chum Bun Rong, spokesman for the Cambodian Foreign Ministry, said.

The United States has had no diplomatic relations with Vietnam and Cambodia since 1979, when Vietnamese forces invaded Cambodia and overthrew the radical Communist government of the Khmer Rouge, which has been accused of causing the deaths of more than 1 million Cambodians during its rule from 1975 to 1978. The Khmer Rouge then regrouped in Thailand and is now the strongest of three factions fighting the government in Phnom Penh.

Vietnam has begun withdrawing its troops from Cambodia, but China said Thursday that “as long as Vietnam does not genuinely withdraw its troops from Cambodia, then China will continue to support the Cambodian people in their resistance against foreign invaders.”

Prince Norodom Sihanouk, who heads one of the two non-Communist factions in the resistance and who is president of a three-party coalition government in exile, issued a statement from his residence in North Korea describing the American move as “a very grave injustice.”

He said it “constitutes a major benefit to the regime in Phnom Penh, which is the creature of a foreign power and a traitor to the fatherland.” It will not prevent the resistance from intensifying its struggle, he added.

Son Sann--leader of the Khmer People’s National Liberation Front, the other non-Communist faction--also condemned the move. The Khmer Rouge had no immediate comment.

Negotiations for a political settlement in Cambodia have produced general agreement on the need for a U.N. peacekeeping role and internationally supervised elections. But discussions have always bogged down on the role of the Khmer Rouge, which demands an equal share of power with the two non-Communist factions and the Phnom Penh government.

Apart from catching Asian nations off guard, the American decision is not expected to result in any major change for the resistance or for the six-nation Assn. of Southeast Asian Nations (ASEAN), which supports the group.

The United States has said it will continue to provide “non-lethal” assistance to the two non-Communist factions. According to a diplomatic source here, this is a signal to the non-Communist groups in the coalition to “distance yourself from the Khmer Rouge or else.”

The U.S. decision is being interpreted by diplomats here as a victory for Hun Sen, the Cambodian prime minister, and for the strategy of “buying time” in the negotiations for a settlement.

It will also boost the political fortunes of Vietnamese Foreign Minister Thach, who has long argued within his government that last year’s withdrawal of troops from Cambodia would eventually pay off with the Americans.

Baker now must explain his decision to the leaders of ASEAN--Indonesia, Malaysia, the Philippines, Singapore and Thailand--whom he is to meet next week in Indonesia. Several of the ASEAN governments have been pressing to restore relations with Vietnam and Cambodia but have met with implacable resistance from the United States.