Vietnamese Celebrate Trade Embargo’s End

Vietnamese quaffed Pepsi-Cola legally for the first time in 19 years on Friday as the country celebrated President Clinton’s decision to lift America’s trade embargo against its old Communist foe.

The government in Hanoi issued a restrained statement saluting Clinton’s move and offering to exchange liaison offices as a first step toward normalizing diplomatic relations.

“This is a positive and significant decision, which contributes to opening a new page in U.S.-Vietnam relations in the interests of the two peoples,” the Vietnamese Foreign Ministry said in a statement.

“On this occasion, the Vietnamese government reaffirms its policy whereby it consistently attaches importance to relations with the U.S. and wishes for normal relations between the two countries on the basis of respect for each other’s independence and sovereignty, non-interference in each other’s affairs, equality and mutual benefit,” it added.

The statement also pledged the “fullest possible” cooperation with the U.S. government to help resolve the issue of U.S. servicemen still listed as missing in action from the war.

More than 2,000 are still listed as missing despite five years of intensive searches by joint Vietnamese-American teams.

While Vietnam has insisted that there is no connection between the political relationship and its humanitarian efforts to find the remains of missing soldiers, diplomatic analysts said they expect a torrent of information to be forthcoming as Vietnam’s way of thanking the Clinton Administration.

The embargo, which has been in place against the northern part of Vietnam for about 30 years, was imposed on the entire country when South Vietnam fell to the Communists in 1975.

It was relaxed in stages by former President George Bush, but Bush declined in his final days in office to lift the embargo completely.

The Clinton Administration has come under increasing pressure from American companies to lift the trade ban because Japanese, Korean and European companies were taking commanding shares of the Vietnamese market, which has boomed since a program of economic reforms was adopted in 1987.

Pepsico Inc. on Friday stole a march on its arch-competitor, Coca-Cola, by handing out cans of its soft drinks in Ho Chi Minh City, which was known as Saigon when it was the capital of South Vietnam.

Pepsico reached a production agreement with a Vietnamese partner, International Beverages Co., last year but refrained from using the Pepsi logo while the embargo was still in force.

Not to be outdone, Coke announced that it will begin shipping in Vietnam as soon as it can get the raw materials there.

Many other American products long have been available to Vietnam’s 69 million consumers because they were smuggled in from Singapore or Thailand.

United Airlines said on Thursday that it plans to start direct flights from Los Angeles to Ho Chi Minh City as soon as possible.

Northwest Airlines, which has been flying to Vietnam to pick up refugees bound for the United States, is also expected to apply for landing rights to carry commercial traffic.

About 30 American companies have already established “representative offices” in Hanoi, and 50 more have applied for permission to do so.

The immediate beneficiaries of the lifting of the trade ban are expected to include Boeing, McDonnell Douglas and Europe’s Airbus Industries, which was banned from selling its planes to Vietnam because they contain U.S. technology.

Both Bank of America and Citibank have established representative offices in Hanoi and are expected to bid for participation in Vietnam’s efforts to rejoin international capital markets, settle its debts with the International Monetary Fund and resume borrowing money.

Even though Japanese companies will now face intensified competition from U.S. firms in Vietnam, a statement from a Japanese trade organization applauded Clinton’s decision.

“It is something we should be glad of and welcome wholeheartedly,” said the powerful Japan Federation of Economic Organizations.

“U.S. firms can now carry out economic activities freely, and a closer relationship between the United States and Vietnam will contribute to stabilizing politics and economy in the overall Asia-Pacific region.”