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Vietnam Bilateral Trade Agreement
BILATERAL TRADE AGREEMENT: HISTORIC STRENGTHENING OF THE U.S.-VIETNAM
July 13, 2000
In 1993, President Clinton began a policy of normalization of relations
with Vietnam to encourage Vietnams cooperation on issues of interest to
the United States and to promote Vietnams integration into the region and
the world economy. The decision to pursue the trade agreement was made after
Vietnam had established a record of cooperation in accounting for
POW-MIAs from the war, the highest priority in our relations.
The Bilateral Trade Agreement signed on July 13, 2000, marks a key step
in the historic reconciliation between the United States and Vietnam. By
normalizing trade relations and committing Vietnam to sweeping economic reform,
it will help lay the foundation for a new American relationship with
The policy of normalization has led to:
Strengthened cooperation on the fullest possible accounting of our
missing from the war. Since 1993, the United States has undertaken 39 joint
field activities with Vietnam, repatriated 288 possible sets of remains, and
identified the remains of 135 formerly unaccounted for American
Resettlement of tens of thousands of refugees through the Orderly
Departure Program and related programs. Over 500,000 Vietnamese have emigrated
as refugees or immigrants to the United States and only a small number of
refugee applicants remain to be processed.
Enhanced cooperation in combating narcotics trafficking, promoting
human rights and religious freedom and expanding economic linkages. Our human
rights dialogue, begun in 1993, has led to release of prisoners and some
improvements in the overall situation.
The process of normalization has been accomplished in a step-by-step
manner, leading to the Bilateral Trade Agreement:
1989 -- Vietnam withdraws from Cambodia and seeks admission into
regional organizations, sending a clear message that Vietnam intended to play a
positive role in regional security and economic liberalization;
1993 - The President authorizes the United States to support
international lending for Vietnam and allows for U.S. firms to join in
1994 - The President lifts economic embargo to allow U.S. firms to
export to Vietnam and compete for business opportunities in Vietnam that had
1995 -- Vietnam joins the Association of Southeast Asian Nations
1995 -- The United States opens normal diplomatic relations with
1996 -- The United States begins negotiations with Vietnam on a
Bilateral Trade Agreement that would improve the opportunities and protections
available to U.S. firms;
1997 -- Exchange of ambassadors. President Clinton appoints former
Congressman and POW, Douglas "Pete" Peterson to be the U.S. Ambassador to
1998 -- Vietnam joins the Asia Pacific Economic Cooperation (APEC)
1998 -- The United States grants the first waiver of the
Jackson-Vanik amendment extending U.S. export promotion and investment support
programs to Vietnam. The waiver was then renewed in 1999 and 2000;
1999 -- The United States and Vietnam reach an agreement in principle
on key provisions of the Bilateral Trade Agreement; and
2000 -- The United States and Vietnam reach final agreement on the
Bilateral Trade Agreement, fulfilling the Presidents goal of negotiating
a comprehensive trade agreement with Vietnam that would advance reform by
leading to significantly more open markets and to Vietnams firmer
integration into the global economic community.
Vietnam has made a comprehensive set of commitments on: tariffs and
non-tariff barriers for industrial and agricultural goods, the full range of
services, intellectual property rights, investment, transparency and other
issues. This constitutes for the first time a broad opening of Vietnamese
markets for the United States, and will provide a major stimulus to
Vietnams economic reform efforts. This agreement sends a positive signal
regarding Vietnam's commitment to integrating into the world economy and is an
important step toward both the development of the rule of law in Vietnam and
its eventual membership in the World Trade Organization (WTO).
The agreement has five major sections, including:
Dramatic new market access for agricultural and industrial goods for
American citizens and companies;
Increased intellectual property rights protection;
Market access in a broad array of service sectors;
Investment provisions to protect
U.S. investments; and
Transparency Measures making Vietnamese laws, rules, and regulations
in these areas public and including a right to appeal for U.S. citizens
U.S. total (two-way) goods trade with Vietnam totaled $900 million in
1999. Exports to Vietnam have increased considerably in recent years from $4
million in 1992 to $291 million in 1999.
DETAILS OF THE BILATERAL TRADE AGREEMENT
The agreement has five major sections:
Market Access for Industrial and Agricultural Goods. Vietnam
agrees to allow all Vietnamese firms, and over time U.S. persons and firms, the
right to import and export freely from within its borders for the first time.
It has agreed to sharply lower tariffs on the full range of U.S. industrial and
agricultural exports, phase out all non-tariff measures, and to adhere to the
WTO standards in applying customs, import licensing, state trading, technical
standards and sanitary and phytosanitary measures.
Intellectual Property Rights. Vietnam agrees to adopt the WTO
standard for intellectual property protection within 18 months and take further
measures in several other areas such as protection of satellite signals.
Market Access for Services. Vietnam allows U.S. persons and
firms to enter its services market in the full range of services areas,
including financial services (insurance and banking), telecommunications,
distribution, audio visual, legal, accounting, engineering, computer and
related services, market research, construction, educational, health and
related services and tourism. These commitments are phased-in over time,
typically within three to five years.
Investment Provisions. Vietnam has agreed to protect U.S.
investments from expropriation, eliminate local content and export performance
requirements and phase out its investment licensing regime for many
Transparency Provisions. Vietnam has agreed to adopt a fully
transparent regime with respect to each of the four substantive areas above, by
issuing draft laws, regulations and other rules for comment, ensuring that
advance public notice is given for all such laws and regulations, that these
documents are published and available, and by allowing U.S. citizens the right
to appeal rulings made with respect to all such relevant laws and
Under U.S. law, for Vietnam to
receive annual NTR status, a bilateral trade agreement must be completed and
approved by Congress, and the President must waive the "Jackson-Vanik"
provision, indicating that such a waiver would substantially promote freedom of
emigration from Vietnam. Since 1998, the President has granted the annual
Jackson-Vanik waiver for Vietnam. Thus, completion of this agreement, and its
subsequent approval by Congress, would clear the way for Vietnam to receive NTR
treatment on an annual basis. This in turn would bring Vietnams trade
commitments into force.