U.S. Has Fuel to Rev Up Idling Vietnam Markets

Not long ago, Vietnamese officials approached Pete Peterson, the U.S. ambassador in Hanoi, with an unusual overture: Might the United States be interested in importing a bunch of Vietnamese laborers to work under contract?

Vietnam has been exporting many thousands of its workers, mostly to neighbors such as Japan and South Korea. Officials in Ho Chi Minh City, the former Saigon, recently boasted that they had cut that city’s unemployment rate to 6% last year. “One of the main measures which the city has taken . . . is to send workers abroad,” explained the Vietnamese news agency.

Peterson, who recounted the offer during an interview here last week, politely declined. America doesn’t do that sort of thing these days; we tend to obtain new workers through immigration, not government contracts.

But the offer spoke volumes about where things stand in Vietnam these days.

A few years ago, there were predictions that Vietnam was about to become a new Asian tiger, following the path blazed by South Korea and Taiwan. Instead, it has remained, so far, nothing more than an Asian kitty.

Vietnam had hoped by now to be able to export manufactured goods to the United States. Instead, it finds it can offer to sell America only a few commodities such as coffee beans--and its workers.

Why? There are a couple of factors. The main one is the Communist Party leadership’s obsession with control. Its wariness about opening up Vietnam’s economy to foreign investors was compounded by the Asian financial crisis, which showed how a country like Indonesia can be destabilized when capital floods into and then out of a country.

The other factor is the United States. The Clinton administration, hanging tough, has been unwilling so far to grant Vietnam the normal trading rights (formerly called most-favored-nation benefits) that would allow Vietnam to send its goods here without paying high duties.

Sure, Vietnam can sell some cheap shoes and clothes in Asia and Europe. But as long as its products are subject to high tariffs in the United States, Vietnam won’t be able to compete with countries, including China, that have normal trading rights. And until Vietnam can sell in this country, it can’t attract large-scale foreign investment.

“Vietnam cannot create an industrial base until they get access to the American market,” observes Peterson.

To sell in America, the world’s largest market, Hanoi needs first to work out a trade agreement. Before concluding such a deal, the Clinton administration is insisting that Vietnam reform its state-controlled economy more than the regime has been willing to do.

There’s also the question of human rights, which could hold up any trade agreement in Congress. The Communist regime continues to repress dissent and permits no challenges to its monopoly on power. A few weeks ago it expelled Gen. Tran Do, an old revolutionary, from the party after he publicly advocated greater democracy in Vietnam.

These are legitimate, serious complaints. Yet from a broader historical perspective, you also have to marvel at the way the United States treats different countries by different rules at different times.

The Carter administration gave China normal trading rights in 1980, the year after diplomatic ties were restored. Vietnam is still waiting, nearly four years after it established ties with the United States. Vietnam’s economy is certainly no more closed than China’s, and its human rights record is no worse today than was China’s in 1980.

And so we have the final irony. Throughout the Vietnam War, the U.S. government saw Vietnam not as a country fighting its own nationalist war of independence, but as a proxy for expanding Chinese Communism. Now, long after the war is over, Vietnam is left wishing the United States would give it the same benefits China won years ago.

American foreign policy is sometimes based on factors no one likes to acknowledge. China won its trade benefits during the Cold War, when the Carter administration was eager to establish military ties with China. Vietnam might well find that America’s tough stance on trade would fade if Hanoi forged broad defense links with the Pentagon.

Defense Secretary William S. Cohen was supposed to make an unprecedented visit to Vietnam last month, but the trip was put off until later in the year. U.S. officials insist the delay was merely a matter of logistics, but you have to wonder if Vietnamese officials decided they weren’t ready yet.

Stuck in time, Vietnam is left falling back on old ways to make money. During the Cold War, it sent its workers to places like East Germany and Czechoslovakia. Now, Vietnamese are instead being shipped out to big capitalist countries. The more things change, the more they stay the same.

Jim Mann’s column appears in this space on Wednesdays.