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On the Right Track? - Trade, Reform and Anti-Graft in Vietnam

Updated On: Apr 18, 2006

Vietnam’s almost successful bid to join the World Trade Organization (WTO) and its reshuffling of leadership is leading the country towards greater economic openness and global integration.

Vietnam expects to conclude the WTO talks with U.S. in May after a discussion with US House of Representatives Speaker Dennis Hastert, who is the first US House speaker to visit Vietnam since the war.

“We had a very cordial discussion, we talked about the imminent legislation on PNTR (Permanent Normal Trade Relations) and suggested to each other the ways to best achieve that,” Mr Hastert told reporters. He had earlier urged the US Congress that “the greater good outweighed human right concerns some members had linked with Vietnam’s WTO membership.”

The PNTR status is necessary for Vietnam to join the WTO and the US legislators have promised Vietnam to gain the status. Vietnam has completed deals needed to enter the WTO with most of its leading trade partners and is keen to enter the WTO by November this year when President George Bush attends the Asia-Pacific Economic Cooperation (APEC) summit in Hanoi.

Officials on both sides were optimistic that they were close to a deal but “there remain some issues that need further discussion” said Vietnam’s PM Phan Van Khai. These include export subsidies on non-agriculture products. “We in Vietnam want to conclude the negotiations in May and …I wish the U.S. House of Representatives can help Vietnam,” PM Van added as he affirmed Vietnam’s policy of developing multi-faceted cooperation with the U.S.

The discussion came a week before the reshuffling of Vietnam’s ruling Communist Party. Prime Minister Phan Van Khai, who is 72 and President Tran Duc Luong, who is 68 are anticipated to step down making way for younger leaders.  

“I don’t see any deep ideological disputes. I see horse trading and factional infighting but Vietnam has already made the tough decision politically,” said Long Le, researcher and lecturer in Vietnam studies, University of Houston. This is revealed in Vietnam’s booming economic growth which is a record 8.4% last year and rising foreign investment displaying the shift towards market-oriented reforms.

“A few years ago, even to move one degree of reform brought in ideological objections and arguments, but now, the main trajectory is done,” said Carlyle Thayer from the Australian Defence Force Academy.

While moving forward in economic reforms, Vietnam now faces a different challenge – corruption. This was heightened with the scandal involving the Transport Ministry siphoning funds from infrastructural projects. Minister Dao Dihn Binh was forced to resign and several in the ministry placed under arrest. The country’s normally restrained media has also taken an aggressive stand against corruption.

“Bureaucracy, corruption and wastefulness are serious. They are a threat to our society and a threat to the survival of our regime,” said Phan Dien a politburo member. The Party has plans to improve procedures for personnel selection, and had recently passed a comprehensive law to counter corruption.

Sources:

US lawmaker hints early end to WTO talks with Vietnam (Nhan Dan, 17 April 2006)

Vietnam expects to conclude WTO talks with US in May (The Saigon Times, 17 April 2006)

US Speaker Hastert satisfied at Vietnam visit (Nhan Dan, 17 April 2006)

US house leader satisfied at Vietnam visit (Thanhnien News, 17 April 2006)

Vietnam PM says wants May US trade deal (Thanhnien News, 17 April 2006)

Vietnam to Reshuffle Communist Leadership (Washington Post, 16 April 2006)

Graft vexes Vietnam’s five-yearly Party Congress (The China Post, 17 April 2006)