U.S., Vietnam announce trade agreement

Published July 26, 1999|Updated Sept. 29, 2005

After three years of often-torturous negotiations, the United States and Vietnam announced Sunday that they had finally come to terms on a bilateral trade agreement.

The announcement was made by Deputy Trade Representative Richard Fisher, head of the U.S. delegation, and Truong Dinh Tuyen, Vietnam's minister of trade. They initialed a draft of the trade agreement, with a formal signing expected in about a month.

Analysts said the agreement seems to indicate a willingness by communist Vietnam to open its economy. Vietnam has been one of just six countries not to have a bilateral pact with the United States, and the other nations make up a kind of economic rogues' gallery: Cuba, North Korea, Laos, Afghanistan and Yugoslavia.

"This historic agreement will significantly improve the climate for U.S. trade and investment in Vietnam, and it should also assist Vietnam in its economic development," said Virginia Foote, president of the U.S.-Vietnam Trade Council.

Vietnamese exports to the United States last year were $469-million _ about 5 percent of Vietnam's export total _ consisting mostly of seafood, shoes and textiles. Some economists have predicted the agreement could increase that export figure to $800-million in the first year.

U.S. Ambassador Pete Peterson, the former Air Force pilot who was a prisoner of war in Hanoi for 6{ years, called the agreement "incredibly important."

"It will set the tone for the relationship between our two countries for the next 50 years," he said.

The trade agreement allows Vietnam to receive "normal trade relations" status from the United States, formerly known as "most favored nation" status. This designation carries numerous economic benefits, including the lowering of tariffs, elimination of quotas and removal of other trade barriers.

Vietnam is eager to join the World Trade Organization, and an agreement with the United States has widely been seen as a virtual prerequisite to WTO membership.

The agreement must be ratified by Vietnam's National Assembly and the U.S. Congress. State Department officials and lobbyists expect a mildly bumpy passage through Congress, with ratification expected in November or December. President Clinton would then sign the agreement into law.