Clinton OKs Limited Bids By U.S. Firms on Vietnamese Projects : Trade: Compromise tries to strike a balance between MIA groups and companies that fear losing deals to other countries.

President Clinton relaxed the ban on trade with Vietnam on Monday to allow U.S. firms to bid on development projects there financed by the World Bank and other international agencies. But Clinton retained the embargo on most commercial dealings.

His action nudged the United States a bit closer to ending the hostile relations with Hanoi that go back more than a generation, but signaled that Clinton is not yet fully satisfied with Vietnam’s cooperation in the search for U.S. servicemen still missing from the war.

The United States has diplomats in Hanoi, military teams roaming Vietnam to search for remains of missing soldiers and airmen and Pentagon researchers in the Vietnamese government archives. Monday the State Department agreed to provide $3.5 million in additional U.S. aid funds for a project to supply prosthetic devices for Vietnamese amputees. But “we still haven’t seen enough” cooperation in the search for the missing “to feel comfortable in lifting the embargo altogether,” a White House official said.

This is the third time in less than a year that a U.S. president has modified the 18-year-old economic sanctions against Vietnam in a compromise that attempts to reward Hanoi for the help it has given on the MIA issue while keeping up the pressure on Vietnam to do more.

President Bush, just before leaving office, allowed U.S. firms to open offices in Vietnam and sign contracts to do business there once the embargo is lifted. In July, Clinton withdrew U.S. opposition to a French-Japanese loan that would allow Vietnam to pay off its overdue debt to the International Monetary Fund and thus become eligible for loans from the IMF’s sister institution, the World Bank.

Those steps were criticized by some family groups, veterans organizations and members of Congress who believe Vietnam is hiding secrets about the more than 2,200 U.S. servicemen still listed as missing from the war. But they were also criticized as insufficient by business groups seeking the right to participate in the fast-growing Vietnamese market.

The emotionally charged issue of the MIAs is the last remaining obstacle to peace and normal relations between this country and Vietnam. It is particularly sensitive for Clinton because of his record of opposition to the war and avoidance of military service as a young man.

A White House statement Monday said the Clinton administration “will leave no stone unturned in the effort to determine the fate of those who served our nation” in its longest war. “In evaluating how best to achieve the fullest possible accounting (for the missing), the president looks forward to the continued counsel and advice from the families whose loved ones are missing and the veterans whose fellow soldiers did not come home.”

Although more than 2,200 are listed as unaccounted for, Pentagon officials have said repeatedly that the number whose fate is truly in doubt is less than 100. The United States is spending more than $100 million a year to search plane crash sites, interview Vietnamese villagers and war veterans and study Vietnamese archives in an effort to find out what happened to them.

The White House statement Monday repeated Clinton’s demand for additional progress in four areas before lifting the embargo fully: “concrete results” from the search for remains; assistance in obtaining the cooperation of Laos; fuller access to Hanoi’s records; and resolution of 80 remaining “discrepancy cases” of Americans who were last known to be alive.

Reporting progress in all four, the White House said that “while these efforts by the Vietnamese are welcome, the results are not yet sufficient.”

The National League of Families of American Prisoners and Missing in Southeast Asia, condemned Clinton’s action, saying Clinton was “deceived by the bureaucracy” into reporting progress when there is none.

“The administration should admit the truth: Vietnam is stiffing the United States on the POW/MIA issue, and the bureaucrats are grasping at straws to justify rewarding them.”

But Robert Bernstein, president of BBI Investment Group, a Washington-based venture capital fund set up to finance business investment in Vietnam, said the president’s move “doesn’t help us much. There are a lot of us who have invested substantial dollars and are anxious to proceed (in Vietnam). Our concern is that Japanese, Koreans and Malaysians will take away our opportunities” as Vietnam turns toward a free-market economy.