[House Hearing, 105 Congress]
[From the U.S. Government Publishing Office]
U.S.-VIETNAM TRADE RELATIONS
=======================================================================
HEARING
before the
SUBCOMMITTEE ON TRADE
of the
COMMITTEE ON WAYS AND MEANS
HOUSE OF REPRESENTATIVES
ONE HUNDRED FIFTH CONGRESS
SECOND SESSION
__________
JUNE 18, 1998
__________
Serial 105-98
__________
Printed for the use of the Committee on Ways and Means
U.S. GOVERNMENT PRINTING OFFICE
58-852 CC WASHINGTON : 2000
COMMITTEE ON WAYS AND MEANS
BILL ARCHER, Texas, Chairman
PHILIP M. CRANE, Illinois CHARLES B. RANGEL, New York
BILL THOMAS, California FORTNEY PETE STARK, California
E. CLAY SHAW, Jr., Florida ROBERT T. MATSUI, California
NANCY L. JOHNSON, Connecticut BARBARA B. KENNELLY, Connecticut
JIM BUNNING, Kentucky WILLIAM J. COYNE, Pennsylvania
AMO HOUGHTON, New York SANDER M. LEVIN, Michigan
WALLY HERGER, California BENJAMIN L. CARDIN, Maryland
JIM McCRERY, Louisiana JIM McDERMOTT, Washington
DAVE CAMP, Michigan GERALD D. KLECZKA, Wisconsin
JIM RAMSTAD, Minnesota JOHN LEWIS, Georgia
JIM NUSSLE, Iowa RICHARD E. NEAL, Massachusetts
SAM JOHNSON, Texas MICHAEL R. McNULTY, New York
JENNIFER DUNN, Washington WILLIAM J. JEFFERSON, Louisiana
MAC COLLINS, Georgia JOHN S. TANNER, Tennessee
ROB PORTMAN, Ohio XAVIER BECERRA, California
PHILIP S. ENGLISH, Pennsylvania KAREN L. THURMAN, Florida
JOHN ENSIGN, Nevada
JON CHRISTENSEN, Nebraska
WES WATKINS, Oklahoma
J.D. HAYWORTH, Arizona
JERRY WELLER, Illinois
KENNY HULSHOF, Missouri
A.L. Singleton, Chief of Staff
Janice Mays, Minority Chief Counsel
______
Subcommittee on Trade
PHILIP M. CRANE, Illinois, Chairman
BILL THOMAS, California ROBERT T. MATSUI, California
E. CLAY SHAW, Jr., Florida CHARLES B. RANGEL, New York
AMO HOUGHTON, New York RICHARD E. NEAL, Massachusetts
DAVE CAMP, Michigan JIM McDERMOTT, Washington
JIM RAMSTAD, Minnesota MICHAEL R. McNULTY, New York
JENNIFER DUNN, Washington WILLIAM J. JEFFERSON, Louisiana
WALLY HERGER, California
JIM NUSSLE, Iowa
Pursuant to clause 2(e)(4) of Rule XI of the Rules of the House, public
hearing records of the Committee on Ways and Means are also published
in electronic form. The printed hearing record remains the official
version. Because electronic submissions are used to prepare both
printed and electronic versions of the hearing record, the process of
converting between various electronic formats may introduce
unintentional errors or omissions. Such occurrences are inherent in the
current publication process and should diminish as the process is
further refined.
C O N T E N T S
__________
Page
Advisory of June 9, 1998, announcing the hearing................. 2
WITNESSES
U.S. Department of State, Hon. Douglas ``Pete'' Peterson, U.S.
Ambassador to Vietnam; accompanied by Chuck Kartman, Deputy
Assistant Secretary of State................................... 26
______
American Chamber of Commerce in Vietnam-Hanoi Chapter, Thomas
O'Dore......................................................... 72
American Legion, John F. Sommer, Jr............................. 108
Asia Pacific Council of American Chambers, Greig Craft........... 85
Boat People S.O.S., Nguyen Dinh Thang........................... 51
Burch, J. Thomas, Jr., National Vietnam & Gulf War Veterans
Coalition...................................................... 103
CIGNA International, Thomas O'Dore............................... 72
Coalition Against Jackson-Vanik Waiver, Diem Hoang Do........... 116
Craft, Greig, Asia Pacific Council of American Chambers......... 85
Do, Diem Hoang, Coalition Against Jackson-Vanik Waiver.......... 116
Duggins, George C., Vietnam Veterans of America................. 98
Foote, Virginia B., U.S.-Vietnam Trade Council.................. 77
Griffiths, Ann Mills, National League of POW/MIA Families....... 46
Harder, Bruce, Veterans of Foreign Wars of the United States,
presenting statement of John E. Moon........................... 95
Joseph, Joel D., Made in the USA Foundation..................... 124
Kerry, Hon. John F., a U.S. Senator from the State of
Massachusetts.................................................. 5
Lalonde, Bradley, Vietnam Citibank.............................. 91
Levan, Filong, Vietnamese-American Voters' Coalition............ 121
Made in the USA Foundation, Joel D. Joseph...................... 124
Montagnard Dega Association, Inc., Y Hin Nie..................... 55
Montagnard Human Rights Committee, Rong Nay..................... 58
Moon, John E., Veterans of Foreign Wars of the United States, as
presented by Bruce Harder...................................... 95
National Alliance of Families for the Return of America's Missing
Servicemen, Lynn M. O'Shea..................................... 61
National League of POW/MIA Families, Ann Mills Griffiths......... 46
National Vietnam & Gulf War Veterans Coalition, J. Thomas Burch,
Jr............................................................. 103
Nay, Rong, Montagnard Human Rights Committee.................... 58
Nie, Y Hin, Montagnard Dega Association, Inc.................... 55
O'Dore, Thomas, American Chamber of Commerce in Vietnam-Hanoi
Chapter and CIGNA International................................ 72
O'Shea, Lynn M., National Alliance of Families for the Return of
America's Missing Servicemen, Bellevue, Washington............. 61
Rohrabacher, Hon. Dana, a Representative in Congress from the
State of California............................................ 18
Smith, Hon. Christopher H., a Representative in Congress from the
State of New Jersey............................................ 21
Sommer, John F., Jr., American Legion........................... 108
Thang, Nguyen Dinh, Boat People S.O.S........................... 51
U.S.-Vietnam Trade Council, Virginia B. Foote.................... 77
Veterans of Foreign Wars of the United States, John E. Moon, as
presented by Bruce Harder...................................... 95
Vietnam Citibank, Bradley Lalonde............................... 91
Vietnamese-American Voters' Coalition, Filong Levan............. 121
Vietnam Veterans of America, George C. Duggins.................. 98
SUBMISSIONS FOR THE RECORD
Office of the U.S. Trade Representative, statement............... 127
______
American Textile Manufacturers Institute, Carlos Moore, statement 128
Bell, Bill, Fort Smith, AZ, statement............................ 130
Caterpillar Inc., statement...................................... 135
Evans, Hon. Lane, a Representative in Congress from the State of
Illinois, statement............................................ 135
General Electric, Hanoi, Vietnam, Andre Sauvageot, letter........ 136
Jefferson Waterman International, Stephen Lamar, letter and
attachment..................................................... 139
Lewis, Howard, III, National Association of Manufacturers, letter 141
McCain, Hon. John, a U.S. Senator from the State of Arizona,
statement...................................................... 33
Moore, Carlos, American Textile Manufacturers Institute,
statement...................................................... 128
Muller, Robert O., Vietnam Veterans of America Foundation, letter 141
National Association of Manufacturers, Howard Lewis III, letter.. 141
Sauvageot, Andre, General Electric, Hanoi, Vietnam, letter....... 136
U.S. Chamber of Commerce, Willard A. Workman, statement and
attachments.................................................... 142
Vietnam Veterans of America Foundation, Robert O. Muller, letter. 141
Will, Richard F., Sr., Westminster, MD, letter................... 107
Workman, Willard A., U.S. Chamber of Commerce, statement and
attachments.................................................... 142
U.S.-VIETNAM TRADE RELATIONS
----------
THURSDAY, JUNE 18, 1998
House of Representatives,
Committee on Ways and Means,
Subcommittee on Trade,
Washington, DC.
The Subcommittee met, pursuant to notice, at 10:05 a.m., in
room B-318, Rayburn House Office Building, Hon. Phil Crane
(Chairman of the Subcommittee) presiding.
[The advisory announcing the hearing follows:]
ADVISORY
FROM THE
COMMITTEE
ON WAYS
AND
MEANS
SUBCOMMITTEE ON TRADE
CONTACT: (202) 225-1721
FOR IMMEDIATE RELEASE
June 9, 1998
No. TR-27
Crane Announces Hearing on
U.S.-Vietnam Trade Relations
Congressman Philip M. Crane (R-IL), Chairman, Subcommittee on Trade
of the Committee on Ways and Means, today announced that the
Subcommittee will hold a hearing on U.S.-Vietnam trade relations,
including the President's renewal of Vietnam's waiver under the
Jackson-Vanik amendment to the Trade Act of 1974. The hearing will take
place on Thursday, June 18, 1998, in room B-318 Rayburn House Office
Building, beginning at 10:00 a.m.
Oral testimony at this hearing will be from both invited and public
witnesses. Also, any individual or organization not scheduled for an
oral appearance may submit a written statement for consideration by the
Committee or for inclusion in the printed record of the hearing.
BACKGROUND:
Vietnam's trade status is subject to the Jackson-Vanik amendment to
Title IV of the Trade Act of 1974. This provision of law governs the
extension of most-favored-nation (MFN), or normal, tariff treatment, as
well as access to U.S. government credits, or credit or investment
guarantees, to nonmarket economy countries ineligible for MFN treatment
as of the enactment of the Trade Act. A country subject to the
provision may gain MFN treatment and coverage by U.S. trade financing
programs only by complying with the freedom of emigration provisions
under the Act. The extension of MFN tariff treatment also requires the
conclusion and approval by Congress of a bilateral commercial agreement
with the United States providing for reciprocal nondiscriminatory
treatment. The Act authorizes the President to waive the requirements
for full compliance with respect to a particular country if he
determines that such a waiver will substantially promote the freedom of
emigration provisions, and if he has received assurances that the
emigration practices of the country will lead substantially to the
achievement of those objectives.
Since the early 1990s, the United States has taken gradual steps to
improve relations with Vietnam. In February 1994, President Clinton
lifted the trade embargo on Vietnam in recognition of the progress made
in POW/MIA accounting and the successful implementation of the Paris
Peace Accords. The United States opened a Liaison Office in Hanoi later
that year. On July 11, 1995, President Clinton announced the
establishment of diplomatic relations, which was followed by the
appointment of former Congressman Pete Peterson as U.S. Ambassador to
Vietnam.
On March 9, 1998, the President issued a waiver from the Jackson-
Vanik freedom of emigration requirements for Vietnam. Because Vietnam
has not yet concluded a bilateral commercial agreement with the United
States, it is ineligible to receive MFN tariff treatment. The
President's waiver for Vietnam, however, gives that country access to
U.S. government credits, or credit or investment guarantees, such as
those provided by the Overseas Private Investment Corporation and the
Export-Import Bank. The President's waiver expires on July 3, 1998. The
renewal procedure under the Trade Act requires the President to submit
to Congress a recommendation for a 12-month extension no later than 30
days prior to the waiver's expiration (i.e., by not later than June 3).
On June 3, 1998, the President issued his determination to waive the
requirements for Vietnam for the period of July 3, 1998, to July 2,
1999.
The waiver authority continues in effect unless disapproved by
Congress within 60 calendar days after the expiration of the existing
waiver. Disapproval, should it occur, would take the form of a joint
resolution disapproving of the President's waiver determination. On
June 5, 1998, H.J. Res. 120 was introduced, disapproving of the
President's waiver determination for Vietnam.
FOCUS OF THE HEARING:
The focus of the hearing will be to evaluate overall U.S. trade
relations with Vietnam and to consider the President's renewal of
Vietnam's waiver under the Jackson-Vanik amendment to the Trade Act of
1974. The Subcommittee is interested in hearing testimony about
Vietnam's emigration policies and practices, on the nature and extent
of U.S. trade and investment ties with Vietnam and related issues, and
on the potential impact on Vietnam and the United States of a
termination of Vietnam's waiver. Finally, witnesses may also address
U.S. objectives in the ongoing negotiations with Vietnam to conclude a
bilateral commercial agreement.
DETAILS FOR SUBMISSIONS OF REQUESTS TO BE HEARD:
Requests to be heard at the hearing must be made by telephone to
Traci Altman or Bradley Schreiber at (202) 225-1721 no later than the
close of business, Friday, June 12, 1998. The telephone request should
be followed by a formal written request to A.L. Singleton, Chief of
Staff, Committee on Ways and Means, U.S. House of Representatives, 1102
Longworth House Office Building, Washington, D.C. 20515. The staff of
the Subcommittee on Trade will notify by telephone those scheduled to
appear as soon as possible after the filing deadline. Any questions
concerning a scheduled appearance should be directed to the
Subcommittee on Trade staff at (202) 225-6649.
In view of the limited time available to hear witnesses, the
Subcommittee may not be able to accommodate all requests to be heard.
Those persons and organizations not scheduled for an oral appearance
are encouraged to submit written statements for the record of the
hearing. All persons requesting to be heard, whether they are scheduled
for oral testimony or not, will be notified as soon as possible after
the filing deadline.
Witnesses scheduled to present oral testimony are required to
summarize briefly their written statements in no more than five
minutes. THE FIVE-MINUTE RULE WILL BE STRICTLY ENFORCED. The full
written statement of each witness will be included in the printed
record, in accordance with House Rules.
In order to assure the most productive use of the limited amount of
time available to question witnesses, all witnesses scheduled to appear
before the Subcommittee are required to submit 200 copies, along with
an IBM compatible 3.5-inch diskette in WordPerfect 5.1 format, of their
prepared statement for review by Members prior to the hearing.
Testimony should arrive at the Subcommittee on Trade office, room 1104
Longworth House Office Building, no later than Tuesday, June 16, 1998.
Failure to do so may result in the witness being denied the opportunity
to testify in person.
WRITTEN STATEMENTS IN LIEU OF PERSONAL APPEARANCE:
Any person or organization wishing to submit a written statement
for the printed record of the hearing should submit six (6) single-
spaced copies of their statement, along with an IBM compatible 3.5-inch
diskette in WordPerfect 5.1 format, with their name, address, and
hearing date noted on a label, by the close of business, Tuesday, June
23, 1998, to A.L. Singleton, Chief of Staff, Committee on Ways and
Means, U.S. House of Representatives, 1102 Longworth House Office
Building, Washington, D.C. 20515. If those filing written statements
wish to have their statements distributed to the press and interested
public at the hearing, they may deliver 200 additional copies for this
purpose to the Subcommittee on Trade office, room 1104 Longworth House
Office Building, at least one hour before the hearing begins.
FORMATTING REQUIREMENTS:
Each statement presented for printing to the Committee by a
witness, any written statement or exhibit submitted for the printed
record or any written comments in response to a request for written
comments must conform to the guidelines listed below. Any statement or
exhibit not in compliance with these guidelines will not be printed,
but will be maintained in the Committee files for review and use by the
Committee.
1. All statements and any accompanying exhibits for printing must
be submitted on an IBM compatible 3.5-inch diskette in WordPerfect 5.1
format, typed in single space and may not exceed a total of 10 pages
including attachments. Witnesses are advised that the Committee will
rely on electronic submissions for printing the official hearing
record.
2. Copies of whole documents submitted as exhibit material will not
be accepted for printing. Instead, exhibit material should be
referenced and quoted or paraphrased. All exhibit material not meeting
these specifications will be maintained in the Committee files for
review and use by the Committee.
3. A witness appearing at a public hearing, or submitting a
statement for the record of a public hearing, or submitting written
comments in response to a published request for comments by the
Committee, must include on his statement or submission a list of all
clients, persons, or organizations on whose behalf the witness appears.
4. A supplemental sheet must accompany each statement listing the
name, company, address, telephone and fax numbers where the witness or
the designated representative may be reached. This supplemental sheet
will not be included in the printed record.
The above restrictions and limitations apply only to material being
submitted for printing. Statements and exhibits or supplementary
material submitted solely for distribution to the Members, the press,
and the public during the course of a public hearing may be submitted
in other forms.
Note: All Committee advisories and news releases are available on
the World Wide Web at `HTTP://WWW.HOUSE.GOV/WAYS__MEANS/'.
The Committee seeks to make its facilities accessible to persons
with disabilities. If you are in need of special accommodations, please
call 202-225-1721 or 202-226-3411 TTD/TTY in advance of the event (four
business days notice is requested). Questions with regard to special
accommodation needs in general (including availability of Committee
materials in alternative formats) may be directed to the Committee as
noted above.
Chairman Crane. Will everybody who can find one take a
seat? And we want to commence here because we've got time
constraints I know for the Senator and for our colleague Dana
Rohrabacher.
Dana, you will want to come up here and grab a chair. And
let's see, we will commence with you, Senator Kerry, and
traditionally we try and get everybody to keep their oral
presentation to 5 minutes. Any written statements will be made
a part of the permanent record. But if you feel, you're not
under a tight time constraint, you can go ahead and go beyond 5
minutes. That is only extended to colleagues.
[The opening statements of Chairman Crane and Mr. Ramstad
follow:]
Opening Statement of Hon. Philip M. Crane, a Representative in Congress
from the State of Illinois
Good morning. Welcome to this hearing of the Subcommittee
on Trade on U.S.-Vietnam Trade Relations.
Since the early 1990s, the United States has taken gradual
steps to normalize our relations with Vietnam. This process has
been most noticeable by President Clinton's lifting of the
trade embargo against Vietnam in 1994, followed by the
normalization of diplomatic relations in 1995 and the
appointment of our former colleague Pete Peterson, who will
testify today, to serve as U.S. Ambassador to Vietnam.
Currently, the Office of the United States Trade
Representative is negotiating a bilateral commercial agreement
which will serve as the foundation for an extension of
reciprocal most-favored-nation (MFN), or normal, tariff
treatment after the agreement is concluded and approved by
Congress. As an interim step, the President issued a waiver for
Vietnam earlier this year from the freedom of emigration
criteria in the Jackson-Vanik amendment to the Trade Act of
1974. Because Vietnam is not yet eligible for MFN trade status,
the practical effect of this waiver is to enable U.S.
government agencies such as the Overseas Private Investment
Corporation and the Export-Import Bank to provide financing to
U.S. firms interested in doing business with Vietnam.
The steps already taken to normalize our relations have
been contingent upon full cooperation by Vietnam on the
resolution of remaining POW/MIA cases. In addition, Vietnam's
continued progress on processing emigration cases is absolutely
essential to justify the President's determination that waiving
the Jackson-Vanik criteria will substantially lead to the
achievement of the emigration objectives. Full cooperation by
Vietnam in all areas of our bilateral relationship is an
absolute prerequisite to laying the groundwork for
Congressional consideration in the future of a bilateral
commercial agreement and extension of MFN tariff treatment.
I look forward to our witnesses testimony today on a broad
range of bilateral issues and policy objectives in U.S.
relations with Vietnam.
Opening Statement of Hon. Jim Ramstad, a Representative in Congress
from the State of Minnesota
Mr. Chairman, thank you for calling today's hearing to
discuss U.S.-Vietnam Trade Relations.
I am pleased that Vietnam has made noticeable progress in
reforming the country's economy since 1986, moving away from
its centrally-planned economy to a more market-oriented one.
Vietnam's own policy of political and economic reintegration in
the world must be encouraged, especially in light of recent
economic decline in the region.
Hopefully, just as the Vietnamese Communist Party has
relinquished some of its control over the economy to spur its
growth, they will also see the benefits of political freedoms
for the citizens. While there are signs of personal freedoms
and considerable power at the local levels, there is
significant need for greater democracy in Vietnam.
Two-way trade between the U.S. and Vietnam has tripled
since 1994, reaching to $666 million in 1997. The U.S. is the
8th largest foreign investor in Vietnam, with $1.2 invested in
the country.
I know some people testifying today will discuss the status
of POWs and MIAs still believed to be in Vietnam and I look
forward to learning more about their concerns, as well as the
potential for locating any more of America's brave soldier with
the help of the Vietnam government.
Knowing how crucial an engaged relationship between the US
and Vietnam,, I want to thank you again, Mr. Chairman, for
calling this hearing. I look forward to hearing from today's
witnesses about the importance and implication of U.S.-Vietnam
trade relations.
Chairman Crane. So, we'll start with you Senator, yes.
STATEMENT OF HON. JOHN F. KERRY, A U.S. SENATOR FROM THE STATE
OF MASSACHUSETTS
Senator Kerry. Mr. Chairman, thank you very, very much.
Bob, it's good to be here with you. And thank you for the
privilege of testifying before the Subcommittee.
This is obviously a very important decision--the question
of the President's decision to waive Jackson-Vanik and the
House and the Congress' rights with respect to that now. Let me
say at the outset that I very, very strongly support the
President's decision. And I believe that overturning it would
have very serious negative consequences not just for our
relationship with Vietnam, but for larger interests that the
United States has in the region. And that's what we measure
when we measure the rationale for a Presidential waiver.
Today, the United States, as we know, has huge and varied
interests in the region--economic interests, strategic
interests including our relationships with China, Cambodia, and
Burma,\1\ as some of us continue to call it.
---------------------------------------------------------------------------
\1\ Myanmar
---------------------------------------------------------------------------
And second, we have a huge interest in promoting freedom of
immigration. And that's an area where the Government of Vietnam
has made substantial progress in the last year or so.
Third, we have an obvious ongoing interest in promoting
human rights and democratic freedoms around the world,
including in Vietnam, where the composition of the population,
over 60 percent of the population, is under 25 years of age.
Their memories of the war and of the divisions between us are
considerably different than those of the vast majority of the
people of Vietnam in the past. And they are moving down an
economic road of increased openness, increased engagement with
the world. To move in a direction that would send a signal from
the United States that we want to disengage or freeze our
bilateral relations at this point would be contrary to our
interests in Vietnam and our strategic interests in the region.
Vietnam is obviously an integral part of Southeast Asia.
The ASEAN meeting, this fall, will be held in Hanoi. Vietnam
has joined the community, and that community wants Vietnam to
be a participant.
In light of the financial crisis that is engulfing Asia and
the turbulent events in Cambodia over the last year, it is in
our enormous strategic interest to have an active presence in
the region, an effective working relationship with the
countries of the region; and that very much includes Vietnam
with some 75 million people.
It was the Bush administration's overtures toward Hanoi in
1990 and 1991 which resulted in the so-called roadmap for
United States-Vietnam relations, and that was born out of the
need to try to help resolve the Cambodian conflict at the time,
as well as to establish regional security and stability. I
think we have overriding strategic and larger political
interests in counterbalancing China's position, and
particularly in recognizing that over the last few years, China
has been very aggressively courting the countries of Southeast
Asia including Cambodia; even those such as Vietnam which were
historical enemies. If we want to make them all an enemy, the
way to do it is to become insular and turn around and start
being punitively self-destructive. We have critical issues
still with Cambodia, with Hun Sen, with the effort of trying to
have an election there. China has been the number one supplier
of arms to the military junta in Rangoon; has continually
worked to develop Burma as an outlet for Chinese goods, from
land-locked Yunnan Province. And although Vietnam has been
invaded by China many times, Beijing has made a concerted
effort to improve relations with Hanoi. Any trip to the border
along China and Vietnam will show you the increased engagement
and commerce that is taking place there.
But last, and absolutely not least, it should be the
responsibility of the U.S. Congress to continue to try to
recognize the road we have traveled with respect to the POW-MIA
issue and the accounting process. For years after the war, Mr.
Chairman, we tried to isolate Vietnam. And at the same time, we
tried to promote the primary interest of the United States,
which was to account for our missing service people. And so we
did that by denying Vietnam the benefits of trade and
diplomatic relations. The record is irrefutably clear--God
bless you--the record is absolutely clear that for the entire
period of that isolation, Mr. Chairman, we didn't get answers.
Our families were getting increasingly frustrated. And the fact
is--and it is indisputable--that progress on the POW-MIA issue
came only as we began to engage the Vietnamese and recognize
that they needed and wanted a relationship with the United
States. That recognition was implicit in the Bush
administration's roadmap, which set out the step-by-step
process for normalization of relations. In fact, the Clinton
administration delayed the roadmap and delayed the process in
order to further press the POW-MIA accounting process.
Today, we have the most significant accounting process any
nation has ever put in place in the history of warfare. And
that was put in place, Mr. Chairman, with a bipartisan effort,
in the Senate particularly, where we had the Select Committee
working on that.
In the last 5 years, American and Vietnamese personnel have
conducted 30 joint field activities in Vietnam to recover and
repatriate remains. Two hundred and thirty-three sets of
remains have been repatriated and 97 remains have been
identified. In addition to working jointly with the United
States on remains recovery, the Government of Vietnam agreed in
1996 to an American request to undertake unilateral actions.
Since that time, Vietnamese teams have provided reports on
their unilateral investigations of 115 cases.
When I became Chairman of the Senate Select Committee on
POW/MIA Affairs in 1991, 196 individuals were on the list of
so-called ``discrepancy,'' or ``last known alive'' cases. These
are the most difficult cases, Mr. Chairman, in which members of
the Armed Forces had survived their incident, and we knew them
to have survived their incident. And we had evidence that they
had survived it. But they remained unaccounted for because they
didn't return alive, and their fate was uncertain. These are
the most difficult and the most heartbreaking cases. As of
today, I am proud to say that fate has been determined for all
but 43 of the 196 on the list. In human terms that means that
because we engaged, because we created a process, because we
were able to visit sites, to work together cooperatively, that
all but 43 families now know to a certainty what happened to
their loved one. That is progress by any measure.
Now since the agreement was reached in December 1994 on
joint United States-Vietnamese-Lao trilateral investigations in
Laos, 22 Vietnamese witnesses have participated in operations
in Laos; the government has identified another 32 to
participate in future investigations. Those witnesses have
proved crucial to our accounting efforts in Laos. For example,
information provided by Vietnamese witnesses resulted in the
recovery and repatriation of remains associated with two cases
in 1996, one involving 8 Americans and another involving 4.
One of the critical questions at the core of the accounting
process is what documents or information does Vietnam or its
citizens have that could provide further answers. When we
started this process in 1991, we didn't have anything that
guaranteed us access to information. Now we have a full-time
archive in Hanoi where Americans and Vietnamese work side-by-
side to resolve remaining questions. Thousands of artifacts,
documents, and photographs have been turned over by Vietnamese
officials for review. In the last 5 years alone, 28,000
archival documents have been reviewed and photographed by joint
research teams. We've conducted over 195 oral history
interviews, in addition to those conducted during the joint
field activities. In response to an American request, Vietnam
in 1994 created unilateral document search teams, and since
that time, they've provided documents, in 12 separate turn
overs, totaling 300 documents of some 500 to 600 untranslated
pages. To date, these teams have also conducted unilateral
research in 19 provinces.
Now, Mr. Chairman, in my time as Chairman of the POW/MIA
Committee and otherwise, I've made numerous trips--in the
double digits--to Vietnam, often accompanied by my good friend,
Senator John McCain and even then by our now Ambassador, then
Congressman Pete Peterson--and I was delighted to have him with
me as part of that critical effort. I'm convinced that we made
progress on this issue, as I know Pete Peterson will tell you
and John McCain will tell you, because we engaged. If they have
documents that we don't have, if there are, indeed, secrets
held, and there probably are, you're not going to get them if
we shut off, and turn off, and turn away. The best hope we've
ever had is to be able to engage people, to learn where things
may be, and to work the process. And if anybody thinks that 20
years of isolation produced those answers, show them to me. The
fact is that it's only the last years of engagement that we've
been able to really begin to create a process that begins to
resolve the dilemma.
The initial waiver of Jackson-Vanik exercised by the
President just a few months ago was a modest but important step
in the continued effort to normalize our relations. It's
important--Mr. Chairman--it's important to note that the waiver
does not extend most-favored-nation tariff status. That's
further down the road. But it does, step-by-step, continue a
very cautious, considered roadmap process of engagement where
we buildup further the relationship.
Now those who oppose Jackson-Vanik argue we're moving too
fast, that Vietnam's performance in immigration, human rights,
and some even assert POW/MIA isn't satisfactory. I disagree, as
I've said, and I think the record backs me up. The use of
carrots or incentives creatively has been at the core of our
policy with respect to Vietnam, and there's no question that
even the decision to move on Jackson-Vanik created further
progress on immigration itself this year. Since the waiver was
issued, Vietnam has made significant and consistent progress in
fulfilling its commitments under the ROVR agreement, which
provides for resettlement in the United States of eligible
Vietnamese who had returned to Vietnam from refugee camps in
the region.
As of June 8, Vietnam had cleared for interview 15,081, or
81 percent, of the 18,718 potential applicants. I would point
out, Mr. Chairman, it's our own INS that has been slow and only
interviewed 9,447 of the 15,000. And so far, 3,119 have arrived
in the United States.
Vietnam is also cooperating with us to expedite processing
of those applicants still in the pipeline and to provide an
accounting of a list of 3,000 individuals which we handed over
in January. The administration expects that a significant
number of these people will be cleared for interview once we've
given the Vietnamese additional information with which to find
them.
Mr. Chairman, since the waiver was granted, Vietnam has
also adopted more liberal procedures in the Orderly Departure
Program, under which some 480,000 Vietnamese have emigrated as
refugees or as immigrants to the United States over the last 10
to 15 years. At this point, there are only about 6,900 ODP
applicants remaining to be processed, including Montagnards and
former re-education camp refugees. Vietnam's agreement early
this month to allow U.S. officials to interview all Montagnard
ODP cases, as well as the procedural changes adopted by
Vietnam, will enable the United States to complete these
interviews by the end of the year. That's progress, and we
shouldn't interrupt it.
Now I will say that human rights is, and must continue to
be, at the forefront of our bilateral agenda. Treasury
Secretary Rubin and Secretary of State Albright have raised
human rights issues with the Vietnamese at the highest levels
during their visits to Vietnam. The United States and Vietnam
have established a regular bilateral human rights dialog, in
which general issues as well as specific issues are raised. I
have consistently raised human rights issues during each of my
trips to Vietnam. I have turned over lists, and we have had
prisoners released. These entreaties and the gradual
improvement in our relations have had some positive results.
Several jailed dissidents have been released and some degree of
liberalization is taking place. No one can go to Hanoi today
and not recognize that exposure to and interaction with other
countries is changing Vietnam at an extraordinary pace.
Vietnamese enjoy more personal liberty than they ever have
before. They own shops; have economic mobility; speak to
foreigners, in most cases without any fear at all. They have
more access to information and foreign media. And although the
newspapers are state papers, they are increasingly outspoken
about corruption and governmental inefficiency.
After last year's legislative elections, the number of
nonparty members elected to the National Assembly doubled, from
8 percent to 15 percent. While this represents a minority of
the Assembly's membership, it is a trend in the right
direction. And the fact that the assembly itself is playing a
stronger role on key issues that are both economic and
political should not be ignored.
Now some would argue that the only way to change Vietnam's
human rights record is to deny them the benefits of trade, to
force OPIC and Ex-Im Bank to close their doors and freeze our
relationship right here and now. As one who has been engaged in
this process for over 30 years and who has witnessed how this
country has changed in such a short time period, I just simply
believe that would be an enormous mistake. And I think the
record of progress bears out that that approach is wrong. We
need to maintain the ability to discuss all of the issues at
the highest levels of government. Vietnamese leaders know full
well the importance that we place on human rights and that
progress on this issue is going to be a very important part of
the context of our future relationship. I know this
Subcommittee will be hearing testimony from some who argue that
Vietnam hasn't even cooperated fully on the POW issue. But I
think the facts and the testimony of all those who participate
in that process would contradict that. During each of my trips,
I've met with the American teams who worked on this issue with
the Vietnamese. Every one of these teams, including the one now
in place, has indicated to me that Vietnamese cooperation has
been outstanding.
Second, to those who argue that Vietnam is withholding
documents or even remains, I say if that is so, the only way
you're going to find out is to continue the process and the
policy we now have in place.
So, Mr. Chairman, I think that we need to continue down the
road we're going. I think reversing the policy by disapproving
the President's waiver would stand to probably slow down some
of the cooperative efforts that we've made progress on and
negate our own interests in the region. And I clearly hope this
Subcommittee and the House will act in the strategic interests
of the United States of America.
Thank you.
[The prepared statement follows:]
Statement of Hon. John F. Kerry, a U.S. Senator from the State of
Massachusetts
Mr. Chairman, thank you for inviting me to testify this
morning on the President's decision to renew the waiver of the
Jackson-Vanik amendment for Vietnam. Let me say at the outset
that I strongly support this decision, and I believe
overturning it would have serious negative consequences for our
bilateral relations with Vietnam and our larger interests in
Southeast Asia.
Today, the United States has many important and varied
interests in Vietnam and in the region. First, we have an
overriding humanitarian interest in continuing the process of
obtaining the fullest possible accounting of American
servicemen missing from the war.
Second, we have an interest in promoting freedom of
emigration--an area in which the government of Vietnam has made
substantial process over the last year.
Third, we have an ongoing interest in promoting human
rights and democratic freedoms around the world, including in
Vietnam where the composition of the population--over 60
percent of Vietnam's population are under 25 years of age--and
the process of economic development hold the promise of
political liberalization over time.
Fourth, Vietnam is a potentially significant market for
American services and goods, but that market can only be
developed if Vietnam maintains the course of economic reform
that it began in the late 1980s. When I was in Vietnam earlier
this year, it was clear to me that there was concern within the
leadership about the financial crisis in Asia and what
implications that crisis had for Vietnam. I believe after
talking with the Prime Minister and other senior Vietnamese
officials that Vietnam will stay the course. However, if we
force Eximbank and OPIC to close down--which is what supporters
of the resolution of disapproval want--we run the risk of
setting that process back. It is in the interest of American
workers and businesses to continue to encourage this process of
reform.
Vietnam is an integral part of Southeast Asia--a region
where political stability has been sporadic at best. In light
of the financial crisis that is engulfing Asia and the
turbulent events in Cambodia over the last year, it is in our
interest to have an active presence in the region and effective
working relationships with the countries of the region,
including Vietnam. In fact the Bush Administration's overtures
toward Hanoi in 1990 and 1991, which resulted in the so-called
``road map'' for U.S.-Vietnamese relations, were born out of
the need to end the conflict in Cambodia and establish a
process to promote regional stability.
We also have overriding strategic and political interests
in counter balancing China's position and growing influence in
Southeast Asia. Over the last few years China has been
aggressively courting the countries of Southeast Asia even
those, such as Vietnam, which were historical enemies. China
has mended fences with Cambodia's second prime minister, Hun
Sen, and was quick to provide aid to Cambodia in the wake of
the coup last July in which Hun Sen deposed his co-prime
minister Prince Ranariddh. China has also been the number one
supplier of arms to the military junta in Rangoon, and has
continuously worked to develop Burma as an outlet for Chinese
goods from land-locked Yunnan province. Although Vietnam has
been invaded by China many times, Beijing has made a concerted
effort to improve relations with Hanoi. A trip to the border
provides a first hand picture of the budding trade relationship
between China and Vietnam.
Last, but certainly not least, we have an interest, a
responsibility, and a national need to heal the wounds of a
nation and put the past behind us once and for all. The step by
step process of normalizing our relations with Vietnam is a
means of healing those wounds.
The real question is how we promote these interests most
effectively? Those who oppose the Jackson-Vanik waiver want to
turn the clock back to the policy that we had in place for some
20 years after the war--a policy of denial. But Mr. Chairman,
as the history of the POW/MIA issue clearly demonstrates, that
policy was a failure.
For years after the war, we tried to promote our primary
interest in Vietnam--to resolve the cases of American
servicemen still missing from the war--by denying Vietnam the
benefits of trade and diplomatic relations. The policy produced
few positive results. Progress on the POW/MIA issue came only
when we began to engage the Vietnamese and to recognize that
the Vietnamese needed and wanted a relationship with the United
States. This recognition was implicit in the Bush
Administration's roadmap which set out a step by step process
for normalization of relations between the United States and
Vietnam.
Today, we can cite enormous progress in the process of POW/
MIA accounting as a result of the cooperation that we have
received, and continue to receive, from the Vietnamese. In the
last five years American and Vietnamese personnel have
conducted 30 joint field activities in Vietnam to recover and
repatriate remains. 233 sets of remains have been repatriated
and 97 remains have been identified. In addition to working
jointly with the United States on remains recovery, the
government of Vietnam agreed in 1996 to an American request to
undertake unilateral action. Since that time, Vietnamese teams
have provided reports on their unilateral investigations of 115
cases.
When I became Chairman of the Senate Select Committee on
POW/MIA Affairs in 1991, 196 individuals were on the list of
``discrepancy'' or ``last known alive'' cases. These were cases
in which individuals survived their loss incidents but they
remain unaccounted for because they did not return alive and
their fate was uncertain. These are the most difficult and
heartbreaking cases. As of today, fate has been determined for
all but 43 of the 196 on this list. This means, Mr. Chairman,
that their families and friends finally know what happened to
them. That is progress by any measure.
Since agreement was reached in December 1994 on joint U.S.-
Vietnamese-Lao trilateral investigations in Laos, 22 Vietnamese
witnesses have participated in operations in Laos; the
government has identified another 32 to participate in future
investigations. These witnesses have proved crucial to our
accounting efforts in Laos. For example, information provided
by Vietnamese witnesses resulted in the recovery and
repatriation of remains associated with two cases in 1996: one
involving eight Americans and another involving four.
One of the critical questions at the core of the accounting
process is what documents or information does Vietnam or its
citizens possess that could provide answers. When we started
this process several years ago, we had little access to
information. That has changed dramatically. We have a full time
archive in Hanoi where Americans and Vietnamese work side by
side to resolve remaining questions. Thousands of artifacts,
documents and photographs have been turned over by Vietnamese
officials for review. In the last five years alone, 28,000
archival documents have been reviewed and photographed by joint
research teams. We have conducted over 195 oral history
interviews in addition to those conducted during the joint
field activities. In response to an American request, Vietnam
in 1994 created unilateral document search teams. Since that
time they have provided documents in 12 separate turnovers
totaling 300 documents of some 500-600 untranslated pages. To
date these teams have also conducted unilateral research in 19
provinces.
During my tenure as Chairman of the POW/MIA Committee, I
spent countless hours and made numerous trips to Vietnam, often
accompanied by my good friend and committee colleague, Senator
McCain, in an effort to develop and improve cooperation on the
POW/MIA issue. I am convinced that we made progress on this
issue because of engagement and cooperation, not isolation or
containment. And I am equally convinced that the best way to
promote our broad range of interests in Vietnam is to continue
to engage the Vietnamese and to follow our present policy of
step by step normalization of bilateral relations with Vietnam.
The initial waiver of the Jackson-Vanik amendment,
exercised by the President just a few months ago in March, was
a modest but important step in the continued normalization of
our relations with Vietnam. Coming nearly three years after the
United States and Vietnam normalized diplomatic relations, this
waiver simply enabled the Export-Import Bank and OPIC to begin
operations in Vietnam--a step that is for the benefit of
American companies and by extension the American economy. It is
important to note that this waiver does not extend most-
favored-nation tariff treatment to Vietnam. That step is
further down the road, and no doubt will come when the United
States and Vietnam have completed negotiations on a bilateral
trade agreement.
Those who oppose the Jackson-Vanik waiver argue that we are
moving too fast, that Vietnam's performance in the areas of
emigration, human rights, and some would even say POW/MIA is
unsatisfactory, that our policy of engagement has yielded few
tangible results. I disagree and I think the record backs me
up.
The use of carrots or incentives creatively has been at the
core of our policy toward Vietnam since the President, with the
overwhelming express support of the Senate, lifted the
unilateral U.S. trade embargo in 1994. There is no question
that the President's decision to waive the Jackson-Vanik
amendment in March of this year led to significant progress on
emigration--the one and sole issue on which the extension of
MFN, US governmental credits and credit insurance is dependent
under the provisions of the amendment.
Since the waiver was issued, Vietnam has made significant
and consistent progress in fulfilling its commitments under the
ROVR agreement which provides for resettlement in the United
States of eligible Vietnamese who had returned to Vietnam from
refugee camps in the region. As of June 8, Vietnam had cleared
for interview 15,081, or 81 percent of the 18,718 potential
applicants. I would point out, Mr. Chairman, that INS has
interviewed only 9447 of those cleared by the Vietnamese to
date. So far, 3119 have arrived in the United States. Vietnam
is also cooperating with the us to expedite processing of those
applicants still in the pipeline and provide an accounting of a
list of 3000 individuals which we handed over in January. The
Administration expects that a significant number of these
people will be cleared for interview once we have given
Vietnamese officials additional information with which to find
them. Not only did the waiver produce results but the very
prospect of a waiver led Vietnamese officials to modify
processing procedures for the program last October.
Since the waiver was granted, Vietnam has also adopted more
liberal procedures for those in the Orderly Departure Program
(ODP) under which some 480,000 Vietnamese have emigrated as
refugees or immigrants to the U.S. over the last 10 to 15
years. At this point there are only about 6900 ODP applicants
remaining to be processed, including Montagnards and former
reeducation camp refugees. Vietnam's agreement early this month
to allow U.S. officials to interview all Montagnard ODP cases
as well as the procedural changes adopted by Vietnam will
enable the United States to complete these interviews by the
end of the year.
Clearly Vietnam has made substantial and measurable
progress in the area of emigration, but what about human
rights. To be candid, Mr. Chairman, the record is not as
impressive. Vietnam continues to be a one-party state that
tolerates no organized political opposition. Many basic
freedoms, such as freedom of the press or speech, are denied or
curtailed, and according to Amnesty International, Vietnam has
at least 54 political prisoners.
Human rights is and must continue to be on our bilateral
agenda with Vietnam. Treasury Secretary Rubin and Secretary of
State Albright have raised human rights issues with Vietnamese
officials at the highest levels during their visits to Vietnam.
The United States and Vietnam have established a regular,
bilateral human rights dialogue in which general issues as well
as specific cases are raised. I consistently raise human rights
issues during my trips to Vietnam. These entreaties and the
gradual improvement in our relations has had some positive
results. Several jailed dissidents have been released, and some
degree of liberalization has taken place.
No one can go to Hanoi and not recognize that exposure to
and interaction with other countries is changing Vietnam.
Vietnamese enjoy more personal liberty than they ever had
before; they own shops, have economic mobility, and speak to
foreigners in most cases without fear. They have more access to
information and foreign media and although the newspapers are
``state papers,'' they are increasingly outspoken about
corruption and governmental inefficiency. After last year's
legislative elections, the number of nonparty members elected
to the National Assembly doubled from 8 percent to 15 percent.
While this represents a minority of the Assembly's membership,
it clearly is a trend in the right direction, as is the fact
that the Assembly itself is playing a stronger role on key
issues, both economic and political.
Some argue that the only way to change Vietnam's human
rights record is to deny them the benefits of trade, force OPIC
and EXIMBANK to close their doors, and freeze our relationship
here and now. As one who has made more than a dozen trips to
Vietnam over the last eight years and who has witnessed how
this country has changed in such a short time period, I
honestly believe that they are wrong. If we want to promote
human rights and political change in Vietnam, we need to expand
our contacts, not contract them through all the tools at our
disposal--trade, aid, exchange programs, participation in ASEAN
and other regional and international institutions. And we need
to maintain the ability to discuss this issue at the highest
levels of government. Vietnamese leaders know full well the
importance that we place on human rights and that progress on
this issue will be part of the context in which our relations
develop.
I know this committee will be hearing testimony later this
morning from some who argue that Vietnam has not cooperated
fully on the POW/MIA issue. As is obvious from my earlier
remarks, I disagree, but let me make two additional points.
First, during each of my trips to Vietnam I have met with the
American teams--teams composed of our military personnel--who
work on this issue daily with the Vietnamese. Every one of
these teams, including the one now in place, has indicated to
me that Vietnamese cooperation has been outstanding. Second, to
those who argue that Vietnam is withholding documents or even
remains, I say if that is so, the only way you are going to
find out is to continue the process and the policy we now have
in place.
Mr. Chairman, I believe the record over the last few years
clearly proves that our step by step approach to normalizing
relations with Vietnam is working and is consonant with the
many interests we have in that country and the region.
Reversing that policy by disapproving the President's waiver of
the Jackson-Vanik amendment will reduce our influence and
threaten future progress on POW/MIA, emigration, human rights,
economic reform and trade, and other interests I have not
discussed, such as stemming the flow of illegal drugs. In
short, it would do irreparable harm to our relationship and our
interests not only in Vietnam but also in the region.
The decision to treat Vietnam as a country, rather than a
war, was made when we normalized diplomatic relations in 1995.
We cannot and should not turn the clock back now. The President
made the right decision when he decided to waive the Jackson-
Vanik amendment and to renew it this month. Congress should let
that decision stand.
Chairman Crane. Thank you, Senator.
Dana, you're up next. Wait just a moment, Dana, if you'll
yield. Do you have to run right now, Senator?
Senator Kerry. I technically do. I'll try to stay for----
Chairman Crane. Well, then, let me see if anyone has a
major question they'd like to direct to you before you split. I
had just one. And that is on Jackson-Vanik and freedom of
emigration: What is the incentive to jail, for religious
reasons or political reasons, any Vietnamese citizen if you can
kick them out of the country?
Senator Kerry. Well, they are not as good as we want them
to be at this point in the normal immigration process, which is
something we're working on right now. I think Ambassador
Peterson will address that, but I know that they have made
increased improvements to that. If you can get a visa, if you
can get a passport, you can leave. And, as I said, under the
ROVR Program, some 15,000 plus have left and come over here. So
we've had a remarkable rate of immigration.
But, you know, this is still unfortunately a one-party
government. It's a totalitarian government. I don't like that.
I've spoken out against that. I will continue to speak out
against that. I look forward to the day hopefully when Vietnam
will be a democracy. But they are moving in the right direction
in terms of each of these issues. And the question is, how do
you engage any of these countries in a constructive way, in a
world where our allies are so reluctant to join us in some of
the sanctions we put in place or other efforts? We tend to be
shooting ourselves in the foot around the world right now, Mr.
Chairman, with a set of sanctions, country-for-country, that no
one joins in with us. It may make us feel good, but the truth
is we're actually losing influence in the process in many of
these places.
And, you know, business certainly is not at the forefront;
never should be at the forefront of any of these choices. We're
talking about value systems. But we also, even as we don't gain
on the value system side, do wind up losing on the business
side, too. And most people who've been engaged in these
countries for long periods of time would say that through
engagement there are huge gains to be made.
I visited the Ford plant in Vietnam. And there are other
plants there. While some complain about the conditions, I mean,
this was a plant as clean as any plant I've ever seen in
Detroit or anywhere. It's modern. And the workers there are
earning two and three times the salaries of the rest of the
people in the country. And they're wearing blue jeans and
western clothes and listening to our music. And even that, a
lot of people in their country object to.
But there's an opening up that automatically comes through
engagement that you simply can't achieve through some of these
older fashion tools that worked in a bipolar, east-west divided
world, which is not where we are today in the world of the
Internet, in the world of wireless communications, and the
world of instant flow of information. They have fax machines,
too. They know what we're doing on a daily basis, just as we
do. And the reality is that it is engagement that will bring
about change and the marketing of democracy. That's what
changed the Eastern European bloc countries.
Why do we apply to Vietnam a standard of change that is
totally different from the successful standard of change we
utilized in so many other parts of the world? The wave of
democracy is winning. We should be excited about the lesson we
learned from the experience we've had of the last 20 years. And
we should be engaging even more so, I think because of the
lessons learned. And Ronald Reagan and others, with their great
public diplomacy efforts, said tear this wall down. And the
efforts of public diplomacy were exactly the opposite direction
of what, you know, disapproving the waiver of Jackson-Vanik
would do vis-a-vis Vietnam.
So I think we need to learn from the positive experience
we've had. And in the end, I think we'll make further progress
with Vietnam on the issue of normal immigration.
Chairman Crane. Thank you.
Mr. Matsui.
Mr. Matsui. I thank the Chairman. Senator Kerry, I
appreciate your observations and comments. I just want to ask
you one question with respect to the POW-MIA issue. We have a
full-time individual there going through the archives. If, in
fact, we deny the waiver this time around, what is your
thoughts on that? Would that person still remain there or what?
And this is just a smaller part of the larger issue I think you
just answered in terms of Mr. Crane's question.
Senator Kerry. I think, Congressman, that clearly if we
begin to take back what we've given, if we begin to suggest
that the judgment made by the administration and the capacity
of the administration to engage is going to be micromanaged by
the Congress in a way that is a slap, you know, at the process,
without cause, we will give them reason to say, well, the
Americans aren't really serious about this. We don't know who
we're dealing with. And you put people at risk. I mean, they
have their own tensions in their government. There are
hardliners there. There are people who want to engage more
there. There are people who think they should be more involved
with China rather than the United States. If you want to give
those people who would move in directions that are inimical to
our larger strategic interest the upper hand, then treat them
badly and treat them like somebody and make ourselves somebody
who is suspect. I think if there weren't progress, then I
wouldn't say waive it. I mean, I went over there specifically
in January to measure whether or not there was sufficient
progress, and we were moving. And I've been willing to call
what I see pretty directly in Vietnam along the way. I've
spoken out against the restraints on religious freedom, and
that's improving. And there are increasing freedoms available
for practicing religious freedom and so forth. I've been to
mass in the cathedral there. I know this as a matter of fact.
Our Ambassador was married in the cathedral there. There are
changes happening. I think to embrace a policy that is already
discredited could result in the archive shutting down and
cooperation slowing down. It will be the families who will
suffer for that and also the larger strategic interests of the
United States of America.
Mr. Matsui. Thank you.
Chairman Crane. Mr. Neal.
Mr. Neal. Thank you, Mr. Chairman.
John, your credentials over the three decades are
impeccable as it relates to this issue. Let me ask you a
question that kind of cuts to the quick. In your judgment,
having been at this for the period of time that you have, is
conceivable that there are POWs that could be still alive,
knowing that this issue draws great emotion, and people are
seeking closure in their lives?
Senator Kerry. Well, the Senate POW/MIA Committee in its
report several years ago unanimously concluded--Republicans and
Democrats alike--that there was no compelling evidence at that
point in time that anybody was still alive certainly in
Vietnam. We did conclude--we did conclude unanimously that it
was our judgment that some people could have been left behind,
or were left behind. So, people have to make a judgment about
the level and credibility of the evidence today. But I will
tell you, none of our teams--I mean, our teams are made up of
servicemen--think there is credible evidence today. Our teams
are made up of people who wear the uniform today. And nobody
better understands than they what it might it be like to be a
person in uniform left behind. So they are not playing politics
in this. They're not coming at it as a Republican or a
Democrat, a liberal or a conservative. There's no ideology.
They're going out there to find Americans if they're there. And
there isn't one general, one admiral, not one person in uniform
on those teams who has gone out to search the evidence that
they're given through intelligence and other sources who has
come back and said, I'm convinced so and so is there. They run
down those reports, sometimes at risk of their life.
So I think we have to rest with their judgment that at this
moment there's no credible evidence that anybody is being held.
I'm not going to give some sweeping statement to write off
some, you know, outlying possibility. But that's why we're
engaged in the most comprehensive and expensive search for
people, not just remains, but for people and answers that any
country has ever mounted in the history of human warfare. And I
think we ought to be very proud of that.
Mr. Neal. How do you react to that suggestion every once
and a while that appears in publications across the country
that there's been a sighting of a potential American POW.
Senator Kerry. Well, I personally react with an element of
skepticism, but nevertheless with the notion that let's check
it out. What we did was put into place a quick response
capacity to go immediately to the best of our ability to
investigate the report. We are in someone else's country. We do
have to rely on logistics. They've improved significantly. And
I can tell you I personally swooped in on some prisons,
unannounced--one or two by accident actually because they
landed in the wrong place. And we went into the prison,
unannounced, and managed to convince people that we should go
through the entire place, and we went through the entire place
and couldn't even find evidence that any American had ever been
there, let alone was there today.
So, I mean, we're trying to do the most exhaustive process
that's ever been engaged in, and I don't frankly know what more
we could do in a cooperative kind of effort where we're
dependent on another country and their people to be able to get
the answers. People can express frustration, and I'm
sympathetic with the frustration for people who've lived 25 and
30 years with no answers, and with a government, frankly, that
wasn't forthcoming for a long period of time. So I'm very
sympathetic to those people who come and say, they may be
holding on to something. But for 20 years, they gave us nothing
or very little even as we were tough. And those were the years
when the evidence was most ripe. Now, later on, after all of
this engagement to the degree there may be evidence, the best
shot is going to be for someone to come up to some American
who's in the country and say, hey, come on over, I want to show
you something. But if you start shutting that down again and
moving in the opposite direction, I think we lose a lot of
interests that are large and that are very compelling for us.
Mr. Neal. Thanks, John.
Chairman Crane. Mr. Ramstad.
Mr. Ramstad. Thank you, Mr. Chairman. I'll be very brief.
Senator, I was going to ask the question my good friend from
Massachusetts just asked, but let me just say this: Your
efforts and those of Senator McCain and my good friend, Pete
Peterson, have been truly exemplary with respect to the POW-MIA
issue. Certainly, the families of Minnesota's POWs and MIAs are
very grateful for those efforts.
With respect to your testimony, I couldn't agree more that
the best hope--the only hope--is engagement. Those, in good
faith, who would build a wall around Vietnam, are very
misguided. In continuing the Richie Neal tradition of cutting
to the chase, let me just ask this: Were we to overturn the
President's Jackson-Vanik waiver for Vietnam, wouldn't we
totally lose leverage with respect to hastening economic and
political reforms, as well as the POW-MIA issue and other
concerns? Wouldn't the leverage just be gone?
Senator Kerry. I believe we would severely set back the
progress we've made, and as I said a moment ago, give people
cause to look for relationships elsewhere, to believe that
we're maybe not interested in being a steady partner.
We don't give up much for this, you know, with the waiver
of Jackson-Vanik, the involvement of Ex-Im and OPIC. I mean,
that is exporting capitalism. Why, in God's name, would we want
to choose to move in an opposite direction than the export of
capitalism, which they're embracing? Here are countries that
have been totalitarian that are embracing free market systems
increasingly. I mean, there are people working on a law project
in Vietnam, trying to put contract law in place, property law
in place, intellectual property law, and so forth. To not
recognize where the world is moving in that regard is to--I
don't know--I guess it's really to be wishing for a world that
isn't any more. But it's not a good place for us to go.
Mr. Ramstad. Thank you very much, Mr. Chairman.
Chairman Crane. And thank you very much, Senator. Oh, wait,
Jennifer, did you have a question?
Ms. Dunn. Thank you very much, Mr. Chairman. And, Senator,
thank you for coming. And I'm a little late to the hearing, so
I don't know if you covered this. But my interest is besides,
then, Mr. Neal's question is also in the area of immigration.
And I'm wondering what the status is, what the trends are, for
immigration, and what obstacles exist to free immigration from
Vietnam?
Senator Kerry. As I did mention a little bit earlier, I'm
delighted to just quickly recap. I just want to get my figures
absolutely correct here. Under the Orderly Departure Program,
some 480,000 Vietnamese have emigrated as refugees to the
United States--or as immigrants--either one--immigrants or
refugees--over the last 10 to 15 years. There are only about
6,900 people in that program now as applicants remaining to be
processed, and those include Montagnards and former reeducation
camp refugees. This month, Vietnam agreed to allow us to
interview all of the Montagnard ODP cases which had been a
problem. So that's an improvement.
In addition to that, as of June, they've cleared for
interview 15,081, or 81 percent of the potential applicants
under the repatriation of returnees program. Those are the
people who left the country and then came back, but who have
cause to believe they want to get out. And we are working with
them--and the Ambassador will detail it--we are making
significant improvements on people's access to visas, access to
passports and ability to be able to leave the country.
So I think as we increasingly build the relationship that
is going to increase. And many, many Vietnamese, you know,
Vietnamese-Americans--are now going back on a regular basis,
and having a great amount of family exchange and so forth in
their former country. All of that has a profound impact, too.
And obviously, if you start slapping down restraints on our
side, they could slap down restraints on their side. And I
think that's counterproductive.
Chairman Crane. Again, we want to express appreciation for
your giving your time and coming over here and testifying and
giving us your insights.
Senator Kerry. Mr. Chairman, I'm delighted to thank you for
the time. I think it's very important.
Chairman Crane. Well, we appreciate it----
Senator Kerry. And I'll apologize to my colleagues.
Chairman Crane. And, Dana, you're up next, and Chris you
want to come up here and grab a seat? And proceed when ready.
STATEMENT OF HON. DANA ROHRABACHER, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF CALIFORNIA
Mr. Rohrabacher. Yes, I would have preferred to have a back
and forth with the Senator because I don't like to refute
someone's arguments when they're not here.
Let me just say that those who believe that we brought down
the Soviet empire, especially the Soviet Union with the use of
trade have an interpretation of history that just boggles the
mind. I mean the fact is that President Reagan never suggested
giving most-favored-nation status to the Soviet Union, and it
was, in fact, the economic barriers that he put up, as well as
the military barriers to the Soviet Union that helped wither
the confidence of those people who were still in the Kremlin
and helped bring down that dictatorship. The idea that we, in
some way, were opening trade with them; and that caused that
society to liberalize is just a pure rewrite of history.
Number two, these archives that the Senator talks about
this is nothing more than--I was there with the Senator when
they opened the archives in North Vietnam several years ago.
This is nothing more than a building in which they give papers
that they want us to read. This is not their archives. This is
not open access to their papers.
The Senator knows very well that we've been requesting some
significant documents for the last 20 years, and the Vietnamese
have not been forthcoming.
For example, even when I was there, and this is a repeated
request, they have not given us the records from the prisons in
which our own prisoners were kept. Where's Pete Peterson? Pete
was kept in a prison, and--you were an MIA for the first couple
years, as prisoner were you not. All right. He was kept as an
MIA and isolated from other American prisoners for several
years. The records from his prison have not been given to us to
find if there were any other Americans who were kept in that
prison or other prisons separate from the other prisoners. Now
it would be very easy for the Vietnamese to give us those
records. Now why haven't they done it? OK, they want to have an
open relationship--give us those records. And when I personally
asked them on our visit to Vietnam, they said American bombs
had destroyed all the records from all their prisons. You know,
give me a break. And I said, and I remember it when Pete was
right there. I said that's like saying the dog ate the
homework. And then they said, well, we can't translate that.
Well. [Laughter.]
I will translate it now. It is beyond believability that
all the records for those prisons were destroyed by American
bombs after the war or near the end of the war. Let's see those
records. This has not been a high level of cooperation, and we
have other things that still need to be addressed. And I think
that we should not give Vietnam economic favors, even if none
of that existed, and we had not been at war with the Communist
dictatorship that still controls Vietnam. Let us not forget
that there has been no liberalization of the dictatorship in
Vietnam. It is still as if the old Communist regime existed in
the Soviet Union. Now I am very much in favor of engaging the
new regime in Russia where they're trying to be democratic.
This is not what's going on in Vietnam. There has been no
liberalization of that government. No attempt at free
elections. No attempt at free speech, at all. Period. Zero. I
am, and that's why and so even if we hadn't had this war with
them and had our POW issue, we still should be very hesitant to
give them to our capital. We are not talking about exporting
capitalism to Vietnam. We are talking about exporting capital
to Vietnam, and whether the American taxpayer should be
subsidizing people who want to invest. So that Ford plant that
Senator Kerry was talking about--hoop dee doo. So the workers
there get paid twice or three times as much as the rest of the
workers in Vietnam--hoop dee doo. How much is that? Fifty cents
an hour? Give me a break. We're going to give a businessman who
wants to invest in a Communist dictatorship a loan guaranteed
by the American taxpayer. And that's what this issue is about.
It's not about free trade. It's about subsidy by the taxpayer
of people who want to take manufacturing units and put it in
Communist dictatorships.
I say and if we're going to have any type of incentive and
subsidies for American businessmen to set up manufacturing
units, let's do it in countries where they are struggling to
create democracy, like the Philippines, for example. They are
struggling to have a democracy there. They need the jobs, and
what are we doing? We're giving businesses an incentive to go
to the Communist dictatorship. We're giving them--our
businesses the incentive to invest in a country that's had
absolutely no reform. And that's the reason why we have this
joint resolution, it's cosponsored by Ben Gilman, chairman of
the International Relations Committee, and Chris Smith, who is
with us today, as well as Senator Bob Smith. And it would
disapprove the President's waiver authority contained in
section 402 of the Trade Act of 1974, in respect to Vietnam. I
say that extending American tax dollars to subsidize or insure
business with the Communist Vietnam is not only a betrayal of
American values, but it's bad business. And with your
permission, I'll put my entire statement in the record.
Chairman Crane. Without objection, so ordered.
Mr. Rohrabacher. The statement goes through time and again,
where because it's a dictatorship, businessmen who go over
there are getting screwed. There, people are being asked for
bribes. They don't come through with bribes. They end up having
to lose their entire investment. There are businesses pulling
out of Vietnam, and a great number right now. Is this a time
when we want to put the good housekeeping seal of approval on
this administration, encourage more businessmen to go over
there? Of course, many of the businessmen who are going there
they don't care if they lose their shirt because they're
guaranteed by good 'ole U.S. taxpayers. And that's what this
debate is about. Again, it is not about free trade. It's not
about engagement. We can engage these people without giving
them subsidy. We engage--Ronald Reagan engaged the bosses of
the Soviet Union. He didn't extend the most-favored-nation
status and say any American businessman that wants to trade
over there is going to be able to get a guaranteed loan from
the Export-Import Bank. It's time that we use our common sense.
I believe in free trade. My motto is free trade between free
people. Let's side with the democracies of the world--these
struggling democracies like the Philippines. Let's work with
these people now in Indonesia who want to have a democracy. And
let's make sure that when you have people who are struggling
and they've made these changes, let's give them that little bit
of help with the Export-Import Bank and others. Let's not
extend this to vicious dictatorships, it makes no sense
business wise; and it makes no sense in terms of the basic
values of our country.
Thank you very much.
[The prepared statement follows:]
Statement of Hon. Dana Rohrabacher, a Representative in Congress from
the State of California
Mr. Chairman:
I have a Joint Resolution, co-sponsored by Ben Gilman,
Chairman of the International Relations Committee and Chris
Smith, Chairman of the Human Rights and International
Organizations Subcommittee, as well as Senator Bob Smith, that
would disapprove the extension of the President's waiver
authority contained in section 402(C) of the Trade Act of 1974
with respect to Vietnam.
Extending American tax dollars to subsidize or insure
business with the communist Vietnam is not only a betrayal of
American values but bad business. The communist regime in Hanoi
has now had six months since President Clinton first granted a
waiver to permit the Ex-Im Bank and OPIC to operate in Vietnam
to demonstrate a willingness to change their repressive and
corrupt system. Unfortunately, human and religious rights
continue to be abused, there are no free and fair elections--in
just last week the regime announced it would create a
``Patriotic Catholic Church'' similar to communist China, and
that Marxism-Leninism is being reintroduced as mandatory study
in public schools.
I knew that business conditions in Vietnam are so bad that
many international companies are pulling out because of the
lack of a credible legal system and the high levels of
corruption on all levels of government. But I was shocked to
learn that the IMF has ended lending to Vietnam because of the
high rate of bad loans in the banking sector, the lack of
honest reporting of Vietnam's financial data and ``inadequate
risk appraisal'' that make all investments in Vietnam high risk
to both lenders and investors.
Yesterday, I received a preliminary briefing by the GAO
team that is working on a study on the Vietnamese economy that
I have requested. I learned that Both IMF and the World Bank
are greatly dissatisfied with the lack of access to the
financial data of the bankrupt Vietnamese banking and stat
economic sectors. That trade data is a state secret, where
journalists and public officials have been jailed under charges
of treason for merely discussing trade issues. That rosy
accounts of foreign investment are overstated because only a
small percentage of contracts are realized because of pervasive
corruption and red tape. The IMF reports, ``Bad loans are
mounting throughout Vietnam's banking sector and import tariffs
remain high.... Vietnam's banks have the politically driven
duty to lend money to state-owned enterprises.''
Even long-time apologists for Vietnam, such as Carlyle
Thayer say that the cause of Vietnam's financial crisis is
Hanoi's ``own doing--corruption, red tape, high overheads,
arbitrary decision-making and Byzantine licensing process are
to blame.''
The International Herald Tribune reports that two major
economic agreements ``have fallen through--protection of
copyrights and commercial air links. Talks on overall trade
agreements drag on.... Investors continue to be harassed by a
communist leadership that has yet to concede that foreign
business need to make money themselves to help Vietnam's
economy grow. Business managers say ``If 10 percent of foreign
invested companies in this country are making a profit, I'd be
surprised.'' Opaque regulations and officials seeking bribes
make Vietnam a hard sell.''
Mr. Chairman, this is not the type of environment that we
should support. Instead, we should hold back further economic
ties as an incentive for the government of Vietnam to reform
economically and politically.
My resolution has the support of the American Legion,
Vietnam Veterans of America and the National Veterans Coalition
and the National Alliance of POW/MIA Families because of their
concerns that Hanoi is not doing enough to account for our
MIAs. Yesterday, high level officials from the Department of
Defense testified before the International Relations Committee
that Hanoi can do more to provide a full accounting.
Numerous Vietnamese-American organizations support this
bill Bacchus the Vietnamese government continues to abuse human
rights on a routine scale, with hundreds of democracy activists
and religious believers still in detention, and because
emigration--especially of former U.S. allies such as
reeducation camp survivors and montagnard veterans and their
families--are being denied by the communist regime.
If precious American tax dollars are to be used as
collateral to promote business in the region, let it be in
democratic countries such as the Philippines, Korea or Thailand
that are struggling to overcome the regional financial crisis.
It is far more prudent to withhold further economic benefits to
the communist government of Vietnam until there is real
progress in reforming their corrupt system and real steps
toward democracy are achieved.
Chairman Crane. Before you start, Chris, I know you have a
tight time constraint, too. But is there anyone that would like
to ask Dana a question before he departs?
Mr. Rohrabacher. Thank you very much.
Chairman Crane. No questions. Thank you, Dana, for your
presentation.
And Chris, you're our next witness.
STATEMENT OF HON. CHRISTOPHER H. SMITH, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF NEW JERSEY
Mr. Smith of New Jersey. Thank you, Mr. Chairman. I
appreciate it, Mr. Matsui, Members of the Committee.
When President Clinton announced in 1995 his intention to
normalize the U.S. relationship with the Communist Government
of Vietnam, some of us argued that we should not take this
important step until the government agreed to be less brutal to
its own people. The administration responded that we had not
yet given up our most important leverage, the wide range of
economic concessions that go with the waiver of the Jackson-
Vanik amendment, including MFN status. The prospect of these
concessions we were assured would be an important incentive for
Hanoi to release its grip on political and religious prisoners,
as well as on re-education camp survivors and other Vietnamese
who had suffered because of their wartime associations with the
United States.
Three years later, the prisoners of conscience are still
imprisoned, and thousands of our former comrades in arms are
still trapped in Vietnam. Yet, in March, the President waived
Jackson-Vanik anyway. The most important immediate consequence
of the waiver was that the U.S. taxpayers began paying for
subsidies to U.S. trade and investment in Vietnam, through the
Ex-Im Bank and the OPIC, the Overseas Private Investment Corp.
Ex-Im Bank and OPIC were probably even more important than MFN,
because the over-regulation and widespread corruption that
characterize the Vietnamese economy make it a relatively bad
place to do business. Ex-Im Bank and OPIC subsidies have the
effect of turning unprofitable deals into profitable ones. U.S.
taxpayers now compensate businesses for the greed and
inefficiency of their partners in Hanoi. This is likely to
bring hundreds, or even thousands, of new United States
entrants into the Vietnam market, which will greatly increase
the political difficulty of ever again linking economic
concessions to progress toward human rights. This is because
most of these taxpayer-subsidized businesses will soon become
energetic lobbyists against any attempt to turn off the spigot.
So the time is now to take a hard look as to whether or not a
Jackson-Vanik waiver is working to promote freedom of
immigration and other human rights in Vietnam. And this is the
time to do it.
The only significant human rights concessions the
Vietnamese Government made in order to get the waiver was to
finally begin letting us interview thousands of former asylum
seekers who had been returned to Vietnam and who are eligible
for the U.S. refugee program called ROVR. As a matter of fact,
Members will recall I tried to stop their return in the first
place. As the CPA was winding down, many of us argued that
these people were true refugees and should have never been put
on planes and put back into Vietnam.
The ROVR Program is for people who managed to escape
Vietnam, but were sent back, although they were refugees under
United States law. Predictably, the Vietnamese authorities
denied us access to the vast majority of these people. As of
December 1, 1997, over 1\1/2\ years after they promised to view
the returnees, they had cleared for interviews only 1,100 out
of an estimated 18,000 to 20,000 who are eligible. But in the 2
months before the waiver was announced, when we really held
their feet to the fire--and I want to commend our distinguished
Ambassador--I have the highest respect for Ambassador
Peterson--they cleared another 13,000. Unfortunately, as soon
as the waiver was granted, the clearances slowed right back to
a trickle. It has been over 3 months now since the waiver, and
only 1,400 additional persons have been cleared for interview,
about 400 per month, as opposed to 4,000 in each of the months
preceding the waiver.
The lesson is clear: The Vietnamese Government has no
trouble clearing refugees for interviews when they really want
to. And once they get what they want from us, they have no
interest in allowing people to leave. So even if the returnees
were the only Vietnamese whose rights we cared about, we should
reverse the Jackson-Vanik waiver until the government allows
the ROVR-eligible refugees to leave.
You might recall, Mr. Chairman, that during the years of
the Jackson-Vanik situation with the former Soviet Union. Every
year some of the refuseniks would be allowed out, but it was
only at that opportune time to try to impress Congress, and to
try to impress the White House, then they went right back to
their old business as usual. Dante Fascell and others always
used to comment on how you could almost predict it, take it to
the bank--some would be allowed out, but then the repression
would be ratcheted right up afterward.
Let me say, we do care about other people, Mr. Chairman.
Aside from ROVR, the other major refugee program is the orderly
departure program for re-education camp survivors, former U.S.
Government employees, and others who never left Vietnam.
Thousands of these people have been unable--unable to get exit
permits from their local security police. In some cases, it's
because their political views and associations made them
particularly unpopular with the government. Others have been
unable to pay the exorbitant bribes frequently demanded for
exit permits. Some of the most deserving refugees, such as
members of the Montagnard ethnic minority, who fought valiantly
for the United States, have suffered greatly ever since--
suffering from both of these disadvantages. And until they get
exit permits, U.S. refugee personnel have been unable to even
interview them for possible resettlement in the United States.
Mr. Chairman, just yesterday, the State Department informed
my staff that the Vietnamese Government had finally granted us
the right to interview ODP applicants without their having
first to get exit permits. At first, I thought this was an
important concession, probably timed to coincide with your
hearing in the upcoming congressional vote on renewing Jackson-
Vanik waiver. Unfortunately, I've since learned that the United
States is still forbidden to interview any ODP applicant until
he or she gets a ``letter of introduction'' from the Vietnamese
Government. It appears that the same officials who have been
denying exit permits will now be in a position to keep people
from getting letters of introduction. For instance, despite the
change in procedure only four Montagnard applicants out of over
800 we believe to be eligible for U.S. refugee programs have
been cleared for interview.
Finally, we must not forget, Mr. Chairman, the Vietnamese
prisoners of conscience imprisoned for their political or
religious beliefs. Hanoi insists that it has no political or
religious prisoners--only ordinary lawbreakers. We've heard
that before. When visiting, American delegations point out that
these lawbreakers include Catholic priests, Buddhist monks,
prodemocracy activists, scholars and poets who are imprisoned
for such crimes as activities to overthrow the government and
``using freedom and democracy to injure the national unity.''
They need to be persuaded that a system like this is not one
with which Americans are comfortable doing business.
Mr. Chairman, the list of human rights violations goes on
and on. Vietnam enforces a two-child per couple policy by
depriving the parents of ``unauthorized children,'' of
employment and government benefits. It denies workers the right
to organize independent trade unions and has subjected many to
forced labor. The government not only denies freedom of the
press, but also systematically jams Radio Free Asia which
strives to bring them the kind of broadcasting they would
provide for themselves if their government would allow freedom
of expression. The congressional decision on the Jackson-Vanik
waiver will set the tone for our future relationship with
Vietnam. The Vietnamese Government and others like it must come
to understand that when they do good things, good things will
flow to them from the United States. When they do bad things to
their people, benefits will no longer flow. We may not be able
to insist on perfection, but we must insist on progress. I
thank you, Mr. Chairman, for this honor of testifying and I
will happily answer any questions.
[The prepared statement follows:]
Statement of Hon. Christopher H. Smith, a Representative in Congress
from the State of New Jersey
When President Clinton announced in 1995 his intention to
``normalize'' the U.S. relationship with the Communist
government of Viet Nam, some of us argued that we should not
take this important step until that government agreed to be
less brutal to its own people. The Administration responded
that we had not yet given up our most important leverage---the
wide range of economic concessions that go with a waiver of the
Jackson-Vanik Amendment, including eventual Most Favored Nation
status (MFN). The prospect of these concessions, we were
assured, would be an important incentive for Hanoi to release
its grip on political and religious prisoners, as well as on
re-education camp survivors and other Vietnamese who had
suffered because of their wartime associations with the United
States.
Three years later, the prisoners of conscience are still
imprisoned and thousands of our former comrades-in-arms are
still trapped in Viet Nam---yet in March the President waived
Jackson-Vanik anyway.
The most important immediate consequence of the waiver was
that U.S. taxpayers began paying for subsidies to U.S. trade
and investment in Viet Nam through the Export-Import Bank
(``Eximbank'') and the Overseas Private Investment Corporation
(OPIC). Eximbank and OPIC are probably even more important than
MFN, because the overregulation and widespread corruption that
characterize the Vietnamese economy make it a relatively bad
place to do business. Eximbank and OPIC subsidies have the
effect of turning unprofitable deals into profitable ones. U.S.
taxpayers now compensate businesses for the greed and
inefficiency of their partners in Hanoi. This is likely to
bring hundreds or even thousands of new U.S. entrants into the
Viet Nam market, which will greatly increase the political
difficulty of ever again linking economic concessions to
progress toward human rights. This is because most of these
taxpayer-subsidized businesses will soon become energetic
lobbyists against any attempt to turn off the spigot. So the
time to take a hard look at whether the Jackson-Vanik waiver is
working to promote freedom of emigration and other human rights
in Viet Nam is right now.
The only significant human rights concession the Vietnamese
government made in order to get the waiver was to finally begin
letting us interview thousands of former asylum seekers who had
been returned to Viet Nam and who were eligible for the U.S.
refugee program called ``ROVR'' (Resettlement Opportunities for
Vietnamese Refugees). This program is for people who managed to
escape Viet Nam but were sent back---although many were
refugees under U.S. law---with a promise that the U.S. would
interview them in Viet Nam and quickly resettle those who were
entitled to our protection. Predictably, the Vietnamese
authorities then denied us access to the vast majority of these
people. As of December 1, 1997, over a year and a half after
they promised to let us interview the returnees, they had
cleared for interviews only 1100 out of an estimated 18,000 to
20,000 who were eligible. But in the three months before the
waiver was announced--when we really held their feet to the
fire--they cleared another 13,000. Unfortunately, as soon as
the waiver was granted the clearances slowed back to a trickle.
It has been over three months now since the waiver, and only
1400 additional persons have been cleared for interview--about
400 per month, as opposed to over 4000 in each of the three
months before the waiver was granted.
The lesson is clear: the Vietnamese government has no
trouble clearing refugees for interview when it really wants
to. But once they get what they want from us, they have no
interest in allowing people to leave. So, even if the returnees
were the only Vietnamese whose rights we cared about, we should
reverse the Jackson-Vanik waiver until after the government
allows all the ROVR-eligible refugees to leave.
But we do care about other people too. Aside from ROVR, the
other major refugee program is the Orderly Departure Program
(ODP), for re-education camp survivors, former U.S. government
employees, and others who never left Viet Nam. Thousands of
these people have been unable to get exit permits from their
local security police. In some cases it is because their
political views and associations made them particularly
unpopular with the government. Others have been unable to pay
the exorbitant bribes frequently demanded for exit permits.
Some of the most deserving refugees---such as members of the
Montagnard ethnic minority who fought valiantly for the U.S.
and have suffered greatly ever since---suffer from both these
disadvantages. And until they get exit permits, U.S. refugee
personnel have been unable even to interview them for possible
resettlement in the United States.
Mr. Chairman, just yesterday the State Department informed
my staff that the Vietnamese government has finally granted us
the right to interview ODP applicants without their having to
get exit permits first. At first I thought this was an
important concession---probably timed to coincide with this
hearing and the upcoming Congressional vote on renewing the
Jackson-Vanik waiver. Unfortunately, I have since learned that
the U.S. is still forbidden to interview any ODP applicant
until he or she gets a ``letter of introduction'' from the
Vietnamese government. And it appears that the same officials
who had been denying exit permits will now be in a position to
keep people from getting ``letters of introduction.'' For
instance, despite the change in procedure, only 4 Montagnard
applicants---out of over 800 we believe to be eligible for U.S.
refugee programs---have been cleared for interview.
Finally, we must not forget the Vietnamese prisoners of
conscience, imprisoned for their political or religious
beliefs. Hanoi insists that it has no political and religious
prisoners---only ordinary lawbreakers. When visiting American
delegations point out that these lawbreakers include Catholic
priests, Buddhist monks, pro-democracy activists, scholars, and
poets who are imprisoned for such crimes as ``activities to
overthrow the government'' and ``using freedom and democracy to
injure the national unity,'' Vietnamese officials cheerfully
remind them that ``we have a different system.'' They need to
be persuaded that a system like this is not one with which
Americans are comfortable doing business.
Mr. Chairman, the list of human rights violations goes on
and on. Viet Nam enforces a ``two-child per couple'' policy by
depriving the parents of ``unauthorized'' children of
employment and other government benefits. It denies workers the
right to organize independent trade unions, and has subjected
many to forced labor. The government not only denies freedom of
the press, but also systematically jams Radio Free Asia, which
tries to bring them the kind of broadcasting they would provide
for themselves if their government would allow freedom of
expression.
The Congressional decision on renewal of the Jackson-Vanik
waiver will set the tone for our future relationship with Viet
Nam. The Vietnamese government and others like it must come to
understand that when they do good things, good things will flow
to them from the United States--and that when they do bad
things, these benefits will no longer flow. We may not be able
to insist on perfection, but we must insist on progress.
Chairman Crane. Thank you, Chris.
Mr. Matsui.
Mr. Matsui. I have no questions. Thank you, Chris.
Chairman Crane.
Mr. Camp.
Mr. Ramstad.
Mr. Neal.
Ms. Dunn.
Well, we thank you for your testimony, Chris, and
appreciate it. We look forward to working with you on an
ongoing way, even though there are times we have our
disagreements. But we share the concerns that you've expressed
here today. Thank you.
Our next witness before the Committee is our distinguished
Ambassador Pete Peterson, who is a former colleague.
STATEMENT OF HON. DOUGLAS ``PETE'' PETERSON, U.S. AMBASSADOR TO
VIETNAM; ACCOMPANIED BY CHUCK KARTMAN, DEPUTY ASSISTANT
SECRETARY OF STATE, U.S. DEPARTMENT OF STATE
Chairman Crane. Pete, you spent what, 6 years in the Hanoi
Hilton?
Ambassador Peterson. Six and one-half.
Chairman Crane. So Pete has a special perspective, but it's
truly remarkable thing that you are serving in the capacity you
are today. We are indebted to you for all of the sacrifices you
made to guarantee that you were able to come back here. He was
here just a couple of weeks ago. Then you traveled all over the
world and you managed to get back here in time for our hearing.
We thank you for that.
Ambassador Peterson. I know what's important, Mr. Chairman.
Obviously, this is a very important issue with me.
It's a great honor for me to be in front of my former
colleagues and all the friends that I have worked with in the
past--several classmates, actually, I see here--Dave, Tim. I'm
happy to have Chuck Kartman with me, as well, from the State
Department, Deputy Assistant Secretary of State for EAP, who as
you know is a Korean expert. But he's got us a lot of other
work as well and I'm very proud to have him with me.
This issue that you're looking at today, the renewal of
Jackson-Vanik, is critically important to the United States. It
would signal, not only to the Vietnamese, but I think to the
rest of the world that we are not closing the gates. That we
are, in fact, going to continue to reach out to the rest of the
world and export our capitalism--as the Senator so well put it
a moment ago. I might add that I know I'm back to this 5-minute
rule which I got away from----
Chairman Crane. Well, except for distinguished witnesses
such as yourself, you can have latitude.
Ambassador Peterson. But I went back to Vietnam, not
because I had to. I went because I wanted to. I saw the
Vietnamese at their very worst and they saw me at my very
worst, as well. It's a rare opportunity for someone to go back
to a country like this in which there was so much pain to focus
then on the future, not the past, and to close the gates of the
past because you can't change that. I can't do anything about
what happened yesterday, but I can help move forward positively
and constructively on what happens tomorrow.
That's why I'm in Vietnam. Because Vietnam is a very large
country--12th most populated country in the world. It has a
very, very intellectual population and as the Senator said the
most significant aspect of that population--he said over 60
percent is under age 25. Do you see the potential that lies
there? This is a nation in major transition. It's being
transitioned politically, economically and generationally.
We, as a Nation, have the opportunity to influence that
transition in everyone of those aspects. My staff and myself
work diligently in promoting American interest in that
transition process in Vietnam everyday. As a result of that,
we've created an incredible amount of goodwill--goodwill that
has taken us now to helping the Vietnamese understand what a
free market is. They essentially woke up one morning and said
this is what we have to do. We have to transition from a
centrally planned economy to a free-market economy if we're
going to be successful in the rest of the world. They're
starting to move into that. They don't know how to do it.
They're asking for help. They want American help because they
look to us--strangely enough--as the leader in this effort and
let bygones be bygones.
This war is no longer being fought in Vietnam, I might tell
you. This is the past and they're building on the future. Why?
In 4,000 years of history in Vietnam, they've never had peace
and prosperity. Never. This is the first time in their history
that they can look out over into the future. They see the
potential of not only prosperity but peace for perhaps
generations. We can help do that because our engagement in
Vietnam not only brings with it the opportunities of expanding
our national interest and meeting our foreign interest goals,
and increasing the opportunities for business, but it brings
that peace and stability potential in a real sense--in a very,
very sensitive and historically violent part of the world.
So our engagement here and the President's very, very wise
choice to open diplomatic relations with Vietnam in 1995 and
then subsequently the efforts to build on that incrementally
over the several years here. Now in March to grant the Jackson-
Vanik waiver--and now enlightenedly coming forward to the
Congress and asking for congressional concurrence for a renewal
of that Jackson-Vanik waiver is exactly the right thing to do.
Because it moves this whole agenda forward. It allows America
to do what it does best and that is to bring nations into the
world community and at the same time help those nations to
learn how to market their product and to develop their
incredibly efficient human resources. Vietnam has all of those.
Why would we take a walk on that? Why would we not do that?
What is the alternative?
The alternative is essentially to isolate Vietnam. Now, I
think Senator Kerry very well stated the case for not doing so.
There's every reason to think that we're going to continue the
progress in immigration, human rights, POW-MIA, and all of the
other aspects of the relationship that we wish to build on by
engagement. By continuing this incremental bilateral process
that will take the Vietnamese into a new level each day. That
new level will hopefully create an economic engine that will
serve the purpose of bringing them, hopefully prosperity, but
will also bring enlightenment to their people. To enlightenment
of their people that ultimately will be reflected in the
government.
In fact, though some speakers today have said that there
has been no change in the Vietnamese Government, I would
suggest there has been some change. The National Assembly has
changed quite dramatically in the last couple of years. In
fact, they have 61 members of the National Assembly that are
not members of the Communist Party. There are three members of
the National Assembly who were elected, who, as the papers put
it, when they were elected said have no political support at
all--which would say that they were totally independent. They
are. One of them is a former ARVN major who is now serving in
the National Assembly. So there is a change.
I see in our frontline position in Vietnam--I see changes
in the power structure. I see the National Assembly assuming
more of the policymaking process. It's not there yet. It's not
what we want to see. It's not a democracy. There are not
opposing parties, but there is a very, very wide spectrum of
ideologies within the government and that is significant to the
extent that it's pulling Vietnam to the right and left based on
the issue.
For us to deny the renewal of Jackson-Vanik would be
playing directly into the hands of those who wish for Vietnam
to return to the old days of totalitarianism and the total
disregard of the world community. It would be a huge reversal
of the opportunities that we have in Vietnam.
Now whenever we talk about Vietnam and look to the
possibility of enhancing our relationship there, we have to
look at what we're doing on the MIA-POW issue. I can assure you
that we're moving ahead on that in a very positive way. Senator
Kerry cited the numbers and I won't re-address those, but I
spend significant part of my time as an Ambassador working this
issue. It is--and the Vietnamese know it is--our first priority
in our relationship. As a result of that, they've done a number
of things that I've specifically asked to be done in enhancing
the overall search efforts. They have not essentially turned me
down on any aspect of that. Now are we getting everything? Are
we getting the equivalent of CIA records? No. I don't think
that anybody expects that to happen right now. We're not going
to send someone in to their very highest and sensitive
documents. But if we can ask for a specific classified
document, they have assured us that they will send someone in
and try to get that document's content and bring that back to
us. We've been doing that for several years.
So with the President's certification earlier this year on
the levels of cooperation on the MIA issue, I can assure you
that it's an accurate appraisal of what's actually happening.
They are cooperating with us on this issue in a very, very
constructive and excellent fashion. As a result of that, we've
been able to move into a whole host of other areas of mutual
concern with the Vietnamese. They're serious about helping us
on this. Someone asked the question earlier--what would happen
if we denied the renewal of Jackson-Vanik? What would that do
to the POW issue?
You know what, I would suggest even if we did deny the
renewal of Jackson-Vanik, the Vietnamese would continue to
cooperate with us in the same manner and fashion they are now
on that issue. They have told me over and over and over again
that this is a humanitarian issue which they are very serious
about and they have no intention, regardless of our actions, of
withdrawing from that. Does that mean we should not renew
Jackson-Vanik because we're going to continue to get
cooperation in the MIA-POW issue? Absolutely not. Because with
the renewal of Jackson-Vanik, we send that message of
commitment.
We have now engaged them in the economic fields and in
medical fields, and in education, and in environment, and in
virtually every other aspect of nation-to-nation relationships.
All of them are positive. A renewal of Jackson-Vanik will
enhance that positive aspect of our relationship. Why would we
not do so? There is no cost essentially. The cost to the
taxpayers for Ex-Im and OPIC, it is widely claimed, is a lot of
money. OPIC actually makes money, if I recall, and the people
who use their services pay for those services. Ex-Im is a
process in which we're exporting products that creates jobs in
America. That's what this is all about.
The companies that are over there right now are taking
great risk and they're doing so on their own nickel. They're
being successful in some areas and unsuccessful in others, but
that's what the capitalistic system is all about. I continue to
tell the Vietnamese that capitalism and a free-market is
essentially the freedom to do two things: freedom to succeed
and freedom to fail. They have to learn that. They have to
learn how to be competitive. Who best to teach them how to do
that than America?
So we have every reason to move on with this and allow this
economic engine to help us with the Vietnamese understanding of
international standards for human rights, help them to
understand how to market themselves in the world community.
Because with them involved in the world community, that
essentially meets the benefit of the United States. We're not
doing anything--United States--in Vietnam that isn't in the
United States' interest.
Now 5 minutes or not, I could go on for a couple of hours
on this subject because I'm there on the frontline, as are my
colleagues. We're there because it's the right thing to do. Our
engagement in Vietnam will and is now having significant
benefit to the United States. To continue to build on this
relationship to the renewal of Jackson-Vanik is absolutely
critical to our credibility with the Vietnamese and frankly to
the credibility of our allies who are involved with commercial
and human rights aspects of their relationship with Vietnam.
So, Mr. Chairman, I'm deeply honored to be here and I value
the--and respect deeply all of the Members of this Subcommittee
and would ask your strong support in the renewal of Jackson-
Vanik for the reasons so stated by Senator Kerry and some
others that will speak after me, but certainly from my
position. Because it is the right thing to do, at the right
time, and is the best thing that we can do for America.
[The prepared statement follows:]
Statement of Hon. Douglas ``Pete'' Peterson, U.S. Ambassador to Vietnam
Mr. Chairman, I would like to thank you for this
opportunity to consult with you today about the Jackson-Vanik
waiver for Vietnam. As you know I arrived in Hanoi a little
over a year ago to take up my duties as U.S. Ambassador to
Vietnam. This is an important posting for me personally as I am
able to focus on the future and put the past, and the memories
of my earlier years in Hanoi firmly behind me. More to the
point, through the exchange of ambassadors the United States
took another significant step in a process of incremental
normalization of our bilateral relationship with Vietnam. On
March 10 of this year, the United States took a step forward
when the President signed a determination granting a Jackson-
Vanik waiver for Vietnam. And earlier this month, the President
decided to renew that waiver for a period of one year and has
asked for Congressional concurrence.
The President made the decisions to grant, and later, to
renew this waiver, first, because the Vietnamese Government had
taken several positive steps to accelerate immigration
processing as requested by the U.S., second, because it is in
the national interest of the United States and, finally,
because the waiver enhances U.S. foreign policy goals. The
record unequivocally shows that incrementally building a
bilateral relationship with Vietnam supports important foreign
policy goals of the United States including POW/MIA accounting,
freedom of emigration, human rights, regional stability and
increased U.S. trade with Vietnam.
Whenever consideration is given to taking any step in
normalizing our bilateral relationship with Vietnam, it is
necessary to once again review progress in the issue of
``fullest possible accounting'' for our missing from the
Vietnam War. On this point, I can assure you that no one in
this Administration--and certainly not I--has forgotten, nor
have we underestimated, the pain and suffering of those who
have lost friends and loved ones in the Vietnam war. I
personally expend a significant portion of my time as
Ambassador directly working this issue and have consistently
emphasized to the Vietnamese that obtaining the fullest
possible accounting of our missing continues to be the highest
priority in our relations with Vietnam. Every senior American
official who meets with Vietnamese government representatives
stresses this point in order to ensure that there can be no
misunderstanding of our position.
Vietnam does understand the importance of this issue to our
government and to the American people and has been providing us
excellent cooperation in our accounting efforts over the past
several years. It was this excellent cooperation that enabled
us to establish diplomatic relations in 1995 and to develop
normal relations in other areas of mutual interest. On March 4
of this year, President Clinton issued a determination that
Vietnam has been ``cooperating fully in good faith'' with us to
account for our missing. This was the third time the President
has validated Vietnam's cooperation.
Vietnam is a nation undergoing an enormous political,
economic and generational transition. After years of self-
imposed isolation from its neighbors and the West, Vietnam's
leaders have adopted a policy of political and economic
reintegration with the world. At the same time, they also
embarked on a policy of domestic renovation, or ``Doi Moi,''
which sought to reduce the role of central planning and
encourage the development of a free market system, particularly
in the agricultural and retail sectors. This policy unleashed a
surge of economic growth in the 1990's and a steady stream of
foreign investors and traders going to Vietnam to seek new
business opportunities. Our policy of re-engagement with
Vietnam builds on and supports these changes.
A prosperous Vietnam integrated into world markets and
regional organizations will contribute to regional stability.
In recent years, Vietnam has made significant strides in
achieving regional integration by joining ASEAN in 1995,
gaining membership to APEC in 1998, and laying the groundwork
for its eventual accession to the WTO. The granting and
continuation of a Jackson-Vanik waiver for Vietnam contributes
to this positive trend.
Insofar as the objectives of the Jackson-Vanik amendment
are concerned, renewal of the waiver will substantially promote
greater freedom of emigration from Vietnam thus fulfilling the
major objective of the amendment. I am confident that the
prospect of a Jackson-Vanik waiver was an important factor last
October in encouraging Vietnam to significantly modify its
processing procedures for the Resettlement Opportunity for
Vietnamese Returnees (ROVR).
Specifically, Vietnam dropped its requirement for ROVR
applicants to obtain an exit permit prior to interview by INS,
a change that has greatly facilitated implementation of ROVR.
Similarly, at the end of April this year, Vietnam modified its
procedures for processing former reeducation camp detainees
under the Orderly Departure Program (ODP), and, on June 3,
Vietnam informed us that we may interview all Montagnard ODP
cases using accelerated interview procedures. The prospects for
renewal of the Jackson-Vanik waiver, it is clear to me, have
favorably influenced Vietnam to continue to facilitate
improvements in ODP processing. The current efficiency and
acceleration of ODP processing demonstrates that the waiver is
achieving its desired results.
It should be pointed out that in a broad sense, Vietnam has
a solid record of cooperation over the last 10-15 years in
permitting Vietnamese to emigrate to the U.S. Over 480,000 have
emigrated to the U.S. via the Orderly Departure Program (ODP),
and there are only about 6,900 ODP applicants remaining to be
processed. With the changes in procedures I mentioned above, we
anticipate that we will be able to complete interviews for
applicants in several of the ODP sub-programs, including ROVR,
by the end of 1998.
After a slow start initially, Vietnamese performance in
implementing the ROVR agreement has improved dramatically this
year. As of June 15, Vietnam has cleared for interview 15,322
or 82 percent of the 18,786 potential applicants. INS has
interviewed 9,892 persons and 3,267 have departed for the U.S.
under the program. Both sides are working to move people
through the pipeline as quickly as possible. Vietnam has not
yet provided clearance for 2,463 persons. However, it has
provided an accounting for cases, comprising 1,001 persons,
that it has not cleared for interview. These are the remainder
of about 3,000 persons for whom we requested an accounting in
January, 1998. We expect that a significant number of these
will be cleared for interview once we are able to provide
additional information to Vietnamese officials on these
outstanding cases.
However, it should be noted that as we near the end of the
caseload, we can expect a slowdown as we begin to process the
remaining cases, many of which lack complete addresses or other
pertinent information. Nevertheless, we will continue to seek
information on these cases and an accounting for any cases
Vietnam cannot locate or finds ineligible.
Another area of concern for the U.S. is human rights, and
we believe that engagement with Vietnam has produced tangible
results. Vietnam does deny or curtail some basic freedoms to
its citizens, including the freedom of speech, association and
religion. There are a number of people in jail or under house
arrest for the peaceful expression of their political or
religious views. We have repeatedly told the Vietnamese that
these practices are unacceptable. I personally press Vietnam
for improvement in these areas at every opportunity and at the
highest levels. Senior U.S. officials visiting Vietnam have
brought our concerns to the attention of Vietnamese officials,
as did Secretary Albright and Treasury Secretary Rubin during
their visits to Vietnam last year. On May 26, our Assistant
Secretary for Democracy, Human Rights and Labor, led the sixth
session of our bilateral human rights dialogue here in
Washington. In that meeting we raised both general human rights
issues as well as specific detention cases of concern to us.
Continuing to engage Vietnam and encouraging greater
openness and reform are the keys to improving its respect for
human rights. I am convinced that Vietnam's contact with the
outside world has led and will continue to lead to increased
openness and relaxation of restrictions on personal liberty, in
addition to improved access to information and foreign media.
Since normalization, several jailed dissidents have been
released. Over time, contacts via media, internet, trade and
investment, travel and exchanges the Vietnamese will likely
move closer to international standards and values relative to
human rights.
Engagement, not isolation, is also the answer for U.S.
business. U.S. business views Vietnam, the twelfth most
populous country in the world with a population of nearly 78
million, as an important potential destination for U.S. exports
and investment. U.S. exports to and investment in Vietnam
ultimately translate into jobs for U.S. workers. To be
successful, U.S. enterprises seeking to conduct business in
Vietnam need access to the U.S. government trade support and
investment promotion programs such as those offered by the
Export-Import Bank (Ex-Im), the Overseas Private Investment
Corporation (OPIC) and the U.S. Department of Agriculture
(USDA) in order to compete on a level playing field with their
foreign competitors who have access to similar programs.
Withdrawal of the Jackson-Vanik waiver would deny these
important programs to U.S. businesses operating in Vietnam with
the end result that the U.S. jobs that might have otherwise
been created are lost.
Vietnam is, admittedly, still a difficult place to do
business. After nearly a decade of economic reform, the pace of
change has slowed in part due to the current Asian Financial
Crisis and, to some extent, due to the slow decision-making
process in Vietnam. While U.S. businesses are not optimistic
about the near-term prospects for increased activity in
Vietnam, many U.S. businesses remain active in Vietnam and
anticipate improved prospects in the medium to long term. They
believe the U.S. government has an important role to play in
encouraging the government of Vietnam (GVN) to improve the
country's business climate.
Vietnam needs to undertake additional fundamental economic
reforms to create the free trade and open investment regimes
that will allow Vietnam's economy to grow and compete
internationally. Recent policy changes indicate that the
Vietnamese leadership understands that the country's economic
performance will suffer further unless it remains firmly
committed to carrying out economic reform. This was confirmed
to me during a one-on-one meeting with Vietnam's Prime Minister
Khai on Monday this week. The U.S. government has consistently
joined the international donor community in urging Vietnam to
further reform state enterprises, the financial sector and the
foreign exchange system, and to move ahead with trade
liberalization.
The U.S. government is using a variety of levers to
encourage Vietnam to undertake these reforms. We actively
engage Vietnamese officials in an on-going dialogue on economic
reform and necessary improvements to their country's business
climate. Bilateral trade negotiations and WTO accession
preparations provide leverage, holding out the prospect of
possible MFN treatment in the future. These processes make
available to us opportunities to obtain from the Vietnamese
commitments to increase U.S. access to that country's markets
and to make changes to their trade and investment regime that
will directly benefit U.S. businesses.
Withdrawal of the waiver at this time would certainly
derail our trade negotiations. As you know, a Jackson-Vanik
waiver is one prerequisite for MFN trading status; the other is
a completed bilateral trade agreement. Both are necessary if
the United States is to support Vietnam's accession to the WTO.
The waiver has already proved to be an useful tool to seek
economic reform and to address U.S. businesses' difficulties in
Vietnam. Shortly after the waiver was granted in March, the
Vietnamese demonstrated renewed interest in concluding the
bilateral trade agreement by presenting a vastly improved
proposal. Vietnam's first formal discussions on WTO accession
were also set around that time. Vietnam would likely interpret
our failure to renew the J-V waiver to mean that the United
States is not a committed or credible party in these
negotiations.
Extension of the Jackson-Vanik waiver for Vietnam directly
benefits the United States by supporting continued Vietnamese
cooperation and dialogue on our most important goals including
POW/MIA accounting, emigration and human rights. Furthermore,
it will enhance our ability to credibly promote comprehensive
economic reform and greater international engagement on the
part of Vietnam. Finally, by ensuring the continued
availability of U.S. government programs such as those offered
by Ex-Im and OPIC to U.S. business, the waiver will enable U.S.
companies to compete effectively in this potentially lucrative
market. As U.S. exports to and investment in Vietnam expand,
more jobs for U.S. workers can be created.
During the 1980's, U.S. policy isolated Vietnam
diplomatically and economically. In the 1990's, we have
established diplomatic relations, exchanged ambassadors, and
began to normalize our economic ties. We have made significant
progress toward achieving our policy goals since we re-engaged
Vietnam. I feel strongly that it is firmly in the U.S. interest
to continue to build a new relationship with Vietnam on a solid
foundation of cooperation on our priority interests.
Chairman Crane. Thank you, Mr. Ambassador. Unfortunately,
Senator McCain was not able to be here, but we have his
testimony which will become a part of the record, too. John, I
think, spent the same time at the Hanoi Hilton as you--6\1/2\
years--didn't he? He's a strong supporter of the views that
you've expressed before the Subcommittee.
[The prepared statement follows:]
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Chairman Crane.
Mr. Matsui.
Mr. Matsui. Thank you very much, Mr. Chairman. Pete, I just
want to, again, congratulate you for resuming the position of
Ambassador of Vietnam. Certainly you're a hero to all of us in
the Congress and to our country. I very much appreciate your
testimony.
I was trying to remember my history because one of the
members that testified before you in the last panel, equated
Vietnam to the Soviet Union. If I recall correctly, the cold
war--Soviet Union was an expansionist power; Soviet Union had
nuclear weapons; Soviet Union obviously was a military threat.
Do you view Vietnam as a military threat? Are they attempting
to expand in other areas in Southeast Asia?
Ambassador Peterson. They did at one time, but I can assure
you they are not now. This is a country of great poverty. I
have visited--have been invited to visit army divisions and
aviation divisions, and I have done so. Their equipage is
essentially a collection of antiques. They're not going to do
much with those, I can assure you. They have reduced the size
of their military establishment by half, roughly. A lot of that
frankly has not come back because in their way of operating,
many of those military people are engaged in commercial
activity because that's how they fund their army. They have
construction companies. They have other kinds of things which I
understand funds roughly 50 to 55 percent of the military
operation--mostly in the salary standpoint.
So they are certainly no military threat to anyone. They
have shown no indication or any desire, in fact, to pursue
that. We have begun, with them, a very narrow and very small
military-to-military liaison because I do have a military
liaison officer on my staff. But the activities that we engage
in are largely humanitarian and exchanging specialties only.
They have not indicated any desire to pursue any military
equipage or anything like that to this extent.
Mr. Matsui. Are the people in Vietnam, from your
perspective, seeking more and more American goods--seeking more
and more American culture? I know there was a front page story
in the New York Times 2 days ago in which a survey was done--a
scientific survey. A polling firm did it with respect to what
the Chinese--who the Chinese view as the most influential
Americans. Thomas Edison, Albert Einstein and Michael Jordan
were among the top four or five--maybe Michael Jordan because
the Bulls had just won the championship. But are the Vietnam
citizens somewhat similar in the sense of really seeking out or
trying to find out what our culture is about--things of that
nature?
The reason I ask that, too, is because through that process
that's how the whole concept of democratization, freedoms and
those kinds of issues start to come into play. That's the whole
concept behind the President, I think, many members who want to
see the continuation of the waiver would view how eventually
Vietnam will become more liberal in terms of freedoms and
religious freedoms and human rights.
Ambassador Peterson. The reason I continue to repeat the
statistic of the 60 percent under the age of 25 is because the
youthful focus is clearly on America. They are so fascinated
with what's happening in America and if you go visit, you will
see constantly tee shirts that are all English. You would think
you were walking in downtown DC or out on the mall someplace
because you can't distinguish these individuals from anyone
else in the world. Blue jeans, sneakers, and the shoes, of
course, of choice are the little slides that they wear. But it
is very, very much focused on America. They look to us as the
leader in the cultural side. English is the most sought after
second language. In fact, people are studying it from dawn
until after midnight every night. The schools are full of
individuals seeking language, economics, and whatever. They
look also for America to--from a leadership of the technology,
management skills, and overall business--entrepreneurial
advice. So America is their idol, I would say, in a general
sense. That's just the people on the street.
I'm not talking about the government; I'm talking about the
average person. I mix with them. I'm downtown. I talk to them
all the time. They give me insights to what they're thinking.
I'm very pleased to say that if they had a choice right now,
they would certainly take America. American products are very
popular there. They realize American products have value. We
just discovered a Caterpillar tractor that is now over 60 years
old. General Electric engines that are running--and generators
that have been running for years and years and years and years.
Most of the rolling stock of the old war days are still running
around in Vietnam carrying cargo. So they know that we have
value, they know we have quality. They know that American
products are generally the products that are desired most
around the world and they seek those.
Chairman Crane. Thank you very much.
Mr. Camp.
Mr. Camp. Thank you, Mr. Chairman.
Thank you, Mr. Ambassador, for being here. You obviously
come to this Subcommittee as a colleague and classmate of mine.
Also, you come with a great deal of personal integrity and it's
good to see you. I appreciate your testimony. I have generally
supported the idea of engagement when dealing with other
countries and I think it's so eloquently stated by Senator
Kerry. But I do have some concerns particularly about the human
rights record in Vietnam.
The continued restrictions on freedom of association;
freedom of press; freedom of religion;the fact that prisoners
of conscience have not been released; the lack of structural
reforms in the banking sector; and the lack of market reforms.
Also, very frankly, progress on the POW-MIA issue that is
concrete. I guess I would ask you how can we most effectively
influence the direction of those political and economic reforms
and at the same time get the fullest accounting of our
prisoners of war. I would like to hear your comments on that.
If you could specifically--how many unaccounted-for Americans
remain in Vietnam? In recent months, what has been the progress
on that issue?
Ambassador Peterson. Well, I'd have to seek out the numbers
here in the book exactly on the MIA-POW issue. But in Vietnam,
I think the number is 1,564 or something like that that are
still listed as MIA. Of that number, however, we have
significant portfolios of investigations. Many of those cases
have been investigated multiple times. If I were to hand you a
case study of a number of them--several hundred of them--you
would probably conclude that well we know what happened to that
individual. But our threshold of proof is very high and
therefore we continue to keep those cases open in order to add
to the portfolio--add to the investigative evidence that would
take us to a final absolute conclusion. I understand that a
board is in fact being formed at DoD hopefully in the near
future that would review these files in a more professional way
and come to the conclusions on some of those cases.
There's still a lot of work to be done. A lot of what we do
is, you know, is essentially archaeology--very, very difficult.
We've done the easy stuff. Now it's just really just head down.
As Senator Kerry said, the people who are doing this are
largely people in uniform--people who have no agenda. They're
there working with the Vietnamese just as colleagues--shoulder-
to-shoulder--working to make these discoveries and they're
doing it from the archaeology standpoint, they're doing it from
the archives standpoint; they're doing it for some interviews
of people throughout the country; and their getting information
from all walks of life.
I might add the fact that we have Americans--more Americans
in the country as a result of American businessmen coming in
with our opening of our diplomatic relations and now hopefully
with the continuation of Jackson-Vanik, that adds to the
potential for spontaneous discovery. We're going to have more
people in the country; we're going to have more access to
various other places--people are just going to go in the larger
areas of the country and hopefully can make discoveries that
our small JTF troops can never get throughout that whole thing.
I think we have six people who are permanently assigned to JTF.
Then we're bringing in a couple of hundred every other month to
do the JTF. But that process will be enhanced through the
waiver and by additional Americans going into the country.
But what we're doing is very systematic, and I might add
that what we have here now is an organizational structure to
get the job done and it's a professional team. Those people who
are working this are just remarkable. I would like for you to
come and visit and let me show you what they're doing. It's an
absolutely fantastic experience to see what these individuals
are doing under very, very adverse conditions. Then marry you
up with the Vietnamese side and let them tell you for
themselves what they're doing and what they're objectives are.
They're moving way out ahead in some areas and doing things on
their own now that they weren't doing before. This is because
of our insistence and request that they do so.
So there's progress being made across that whole spectrum.
The other thing, frankly, is the other side of it is that you
all are funding it--the work--properly. So we have the
organizational structure in place. We have the right kind of
people doing the work. We're funding it properly and we just
have to wait this thing out. Nothing is going to happen quickly
on this. This isn't going to be completed overnight. But I can
assure you that this isn't something that we've got on the back
burner--this is front burner work. Everything we do in the
country is predicated on successes that we derive from our
efforts in the POW-MIA area.
But you also bring up the human rights thing. I'm a firm
believer that only through some mechanism are we able to
achieve the improvement of human rights. I mean, just to sit
there and make law that says you must do this and you must do
that, isn't going to be totally satisfactory. We do make those
points.
At every opportunity, I make that point to the Vietnamese
as virtually every visitor we have that we aren't going to
tolerate the lack of improvement in human rights. But we can
best help that in my view by getting the economic engine
running at a higher momentum and with that hopefully we'll
bring the opportunity for the higher quality of life for all of
the citizens of the entire country which clearly is a human
rights issue in itself. But with that you will bring
empowerment to those individuals that will ultimately force
changes in the political system that will allow greater
freedoms throughout the whole spectrum of human rights.
Mr. Camp. I appreciate that. Over recent years, there's
been a number of steps that have been taken--whether it's
continuing humanitarian aid, lifting the trade embargo,
settling property claims. Do you believe the progress made in
the last 6 months with the Jackson-Vanik waiver is sufficient
to continue the waiver?
Ambassador Peterson. Well, there's no doubt about that. But
you see, it's very hard; in 6 months you can't measure
virtually anything in those kinds of things. OPIC and Ex-Im and
none of those procedural things that would be released as a
result of that have really done anything in Vietnam. There's no
activity from OPIC in the country. There's a number of things
in the pipeline. Ex-Im has done zero in the country. TDA, the
Trade and Development Agency, has one project, I think, that's
being executed and a couple of others that are sitting on the
blocks. There's no change in Ag, no improvement in AID.
Nothing's really happened, so I can't measure that. But I do
know that the Vietnamese have seen it as a positive commitment
from the standpoint of the United States and they have moved
forward with us in our bilateral trade negotiations in a much
more positive way than was earlier possible. The proposals that
they have given us of late, we just concluded our fifth rounds
of talks last month, is a very, very good working document.
We're moving forward in that area.
So I can't measure in 6 months' success and that's why we
need to renew this. It's essentially a no-risk deal on our
part. Once we continue--complete our bilateral trade
relationship negotiation and once we look at what comes with
that--that has to come back to the Congress. A renewal of
Jackson-Vanik will have to come back to Congress next year. So
what you're doing is essentially giving us another look for 12
months on the potentials that can be derived from the
continuation of the Jackson-Vanik waiver.
Chairman Crane. Just to interrupt for a moment. My
understanding is that for the ROVRs there were, in a 3-month
period, 14,000 that were approved to emigrate. Then after the
waiver and the next 3 months, only 150--is that correct?
Ambassador Peterson. That very likely is correct because as
you get down the chain, there was only 18,000--what is it--
18,184 or something like--or 784, that are in that entire list.
So we did the, I guess the easy ones----
Chairman Crane [continuing]. The easy ones.
Ambassador Peterson. Now when you start getting down to the
latter ones, you end up finding some that have difficulties
with having broken Vietnamese law. You have some that
addresses--many of them--that the addresses are just so bad
that you can't find these people. So the processing really
slows down when you get to that point. So I don't think the
fact that Jackson-Vanik was waived at a certain point on that
processing would indicate whether that improved the processing
or not. Although I can tell you that the potential of having
the Jackson-Vanik waiver was critical in the Vietnamese
decision to change the processing procedures so that we could
accelerate and more efficiently conduct our interviews that
would get us through this process.
Chairman Crane. Thank you. Mr. Ramstad.
Mr. Ramstad. Thank you, Mr. Chairman. Welcome to the
Subcommittee, Ambassador. You are not only a good friend and a
classmate, but in my judgment a true profile in courage and a
true American hero. I don't use those terms loosely, Pete. To
endure 6\1/2\ years as a prisoner of war, as you did in Vietnam
and to have the sense of forgiveness, and hope and optimism
that you do is an inspiration to all of us. Congratulations, as
well, on your marriage. You're doing an excellent job and we're
proud of you.
I just wanted to ask, Mr. Ambassador, as I understand
amongst the ruling elite in Vietnam, there are two factions:
the conservatives and the reformers. The reformers want real
economic reform and a stronger private sector while the
conservatives want to retain the country's socialist positions
and more of the status quo. Which faction now is dominant, more
powerful? Can approval of the waiver help boost the reformers'
efforts?
Ambassador Peterson. I would say that the reformers clearly
are in the leadership at this moment. The Prime Minister who I
had a private meeting with--just on Monday of this week--is
very much proactive in moving toward and making policy changes
that would enhance the further development of this free-market
system that they wish to put in place. A very constructive,
very enlightened individual, and his staff, I would suggest, is
of the same mindset. Throughout the rest of leadership
basically it's a reform of leadership of the former advocates.
So spiced around throughout the government are the
conservatives and that is on purpose. Because they have a
consensus-making process in Vietnam and all of the voices have
to have an opportunity to project their concerns and so
throughout the whole governmental structure, you'll have a mix.
But at the moment, I would say that the reformers have the
upper hand and they have the upper hand because of the fact
that we have renewed our diplomatic relationship with Vietnam;
that we have moved forward in our overall bilateral
relationship.
Because let me--let me make sure you understand that our
relationship is not just POW-MIA--it's not just economic--but
there's a whole host of other things we do with Vietnam that
are in the interest of the United States. You may have read
recently where they have cooperated with us in a law
enforcement area where they have apprehended and returned to
the United States some of America's 10 Most Wanted. They did
that out of the fact that they did it because the value of an
agreement to do so. We asked them to do so and they've done
that.
We're working with them, on the discovery and the control
of infectious disease--something that knows no borders, and by
working there in an area where we essentially have a very
devastating laboratory, I might add, we're able to find ways of
treatment and also to prevent those diseases from reaching
America. They're cooperating with us on that whole spectrum of
activity. So it's not just that we're doing economics and these
things that are in the forefront there; there's a whole host of
other activities that are tangential to our work there that are
of great benefit to the United States.
Mr. Ramstad. Do the reformers support greater personal and
political freedoms as well?
Ambassador Peterson. They do and you may be following the
news on that. The Vietnamese people are taking exception to
what the leadership is doing. There have been major outbursts
of disapproval in various provinces in Vietnam and the people
are winning. The Vietnamese Government is having to change
personnel and having to be more transparent in their activity
so that the people are assured of getting what they deserve.
I might add, here that in the past, the Vietnamese have not
had any assets. They had nothing to lose whenever the
government made a policy decision that may have put them in
jeopardy. Now, the Vietnamese people have motorcycles; they
have TVs; they have VCRs; they have houses; they have land;
they have a whole lot of assets that are, in fact, potentially
put into jeopardy if the Vietnamese Government makes the
decision counter to their best wishes.
As a result of that, the government is having to be much
more sensitive to a constituency than they ever have before and
they have told me that over and over. In fact, the National
Assembly members for the first time ever have actually had to
go back to the provinces and campaign for their seats because
there were actually a lot more candidates than there were
seats. I think there were 680 candidates and there were 450
seats. So there was, in fact, competition politically. So
things are changing in that realm.
Mr. Ramstad. Final question: In your judgment, is there any
credible evidence of American POWs or MIAs still alive in
Vietnam?
Ambassador Peterson. I would answer in the same way that
Senator Kerry has--that there's no compelling evidence that
suggests that there is. However, I don't think anybody would
deny the potential that that might occur and that's why we're
searching. We have a very, very strong system established so
that we can investigate live-citing reports almost immediately.
In that regard, we haven't had any live-citing reports for some
time that have been meritorious--in fact, we've never had one
meritorious. So I would suggest that it would be very, very
unlikely that any live Americans will be found in Vietnam;
there is no compelling evidence that suggests that. But I would
certainly never say never.
Mr. Ramstad. Thank you, Mr. Ambassador, Mr. Chairman.
Chairman Crane. Mr. Neal.
Mr. Neal. Thank you, Mr. Chairman. Mr. Ramstad took that
last question from me, but it's just nice to have you back,
Pete. You have special credibility in the House and you were a
terrific Member of the House. I think one of the real troubles
with the American people today is that they never got to hear
from people like Pete Peterson who served in the House of
Representatives. Most of the attention was focused on the
bickering which occurred on a day-in and day-out basis. There
were a lot of people upstairs that had that special credibility
that guys like you have around here. It's a shame the public
never got to focus on you while you were you here. Nice to have
you back.
Ambassador Peterson. Thank you, Richard. Appreciate it.
Chairman Crane. Ms. Dunn.
Ms. Dunn. Thank you very much, Mr. Chairman.
Ambassador, it's good to see you back. We're proud of you
for the work that you're doing in Vietnam. I'm a bit, I guess,
like Mr. Camp. I am as much a supporter of fair and free trade
and support MFN consistently in fast track and sort of saying I
believe in engagement and believe that's a very important
policy. I have not before voted for the waiver for Vietnam,
however, and so it's very important to me what I'm hearing
today in this hearing; particularly, your comments have been
helpful to me.
I have mixed feelings. Since the early eighties, I have
been meeting with a group of Vietnamese--former Vietnamese--
folks who are U.S. citizens and we talked often. In the early
eighties, they were great supporters of Ronald Reagan because
they believed that he would open up the opportunity for them to
go back home, where they could speak their own language and
visit their relatives. So that was a common link that we had.
But now they're telling me that they're very concerned about
our agreement, or my voting for this waiver because, most
particularly, of the MIA-POW situation on the others.
And along with that, I will simply tell you that at a
dinner table conversation a couple of years ago I was listening
to a member, an employee, of the Russian Embassy here who was
telling me how great a hero our own Sam Johnson was in the
prison camp. And I said, ``How do you know this?'' And he said,
``Because I have access to the records.'' And I want to feel
that we've got access to those same records that the Russians
are looking at, because I think it's important.
On the other side of it, I talk with people like Roy
Prosterman, who has been very helpful in Vietnam and other
Asian regions and other regions, like the Philippines, in the
area of land use and how you convert from a totally
totalitarian system to a system where people can own their own
private property, and how that property can be used.
I am concerned about a couple of things that were said by
earlier people who testified here. I think the point that Mr.
Rohrabacher makes about, why are we putting our money into
economic organizations that guarantee loans in totalitarian
countries like Vietnam, when we could be putting this emphasis
into emerging democracies or democracies-to-be, as the
Philippines?
So these are all things that come into my mind. I guess I'm
asking you, what position gives us the best leverage in helping
this nation open up more to an eventual less totalitarian
system than communism right now? And what's happening in the
economy? And what puts us in the very best position to be able
to urge them to go forward and provide them incentives, and yet
not be naive about it, be very realistic about it, because we
need something back in return?
Ambassador Peterson. Well, you've asked quite a spectrum of
questions there and the best way for us to influence the
Vietnamese into moving forward positively and constructively in
a transition politically, economically across the board there,
is clearly continuing our engagement. And that's the full
spectrum of our engagement, I mean, this is not being halfway,
and what we have to do ultimately is normalize our relationship
with Vietnam across the whole spectrum of our opportunities
here. Renewing Jackson-Vanik is just one of those aspects of
it, it's not all of them. I might add that this isn't taking us
to most-favored-nation status. It's only to take us to the
release of Ex-Im, OPIC, and some of the other financial
mechanism, programs that would aid American businesses that are
doing business in Vietnam now, over 400 American businesses are
there now. And so we're just opening up the opportunities for
them to be competitive with the other nations that are already
there, and I might add Australia is just celebrating their 25th
year of relationship with Vietnam, 25 years they've been
working with Vietnam in all sorts of activities. And their
objectives in working with Vietnam are much the same as ours,
and that is the human rights aspects, the economic aspects and
even to the extent of the POW-MIA issue, they've been very
supportive with us on that.
I just think that for us to take exception to everything
they're doing, and they're not doing everything we'd like them
to do, I mean, it's not a perfect society. For us not to be
there and not to influence them through our processes of
economics and to our POW-MIA issue, and through our political
mechanisms, then we can't really complain about what they're
doing. We can complain now, at the very highest levels. I have
access to virtually every office in the land. The goodwill that
is established between our two nations is at a very high point
at this time, and we need to take advantage of that. They're
looking to us for leadership. They're listening to us in the
process of our conversations across the POW, human rights,
economics, and political issues. And they're assisting us from
the standpoint of, as I said, law enforcement, infectious
disease control, all of those kinds of things in a very
constructive way, and this would continue that.
Now, may I say, please, on the point you made of Sam
Johnson: I've worked with the Russians on the documents that
they have, and if this Russian has those kinds of documents, I
would like for him to bring them forward because in the 6
years, the nearly 6 years I worked with them, none of that was
ever discovered and we had a full team that was there working
in the Russian archives and we never found anything of the
sort. So I suggest that this may be a slight exaggeration on
the part of that individual. But certainly Sam Johnson is a
hero and a very good friend of mine and he conducted himself
with incredible distinction while in captivity and I'm proud to
say that I was happy to serve with him in that capacity.
Ms. Dunn. Let me just follow up, you made one point--the
economic situation, could you augment a little bit your
thoughts on the trend of the economic situation. We have
stalled on bilateral negotiations with Vietnam and the IMF in
fact is holding back its most recent payment to Vietnam and I'm
wondering what your thoughts are on how that's moving and if
you see some resolution to that soon.
Ambassador Peterson. The IMF, as you know, has very strict
standards and rightfully so, and the IMF has really held, their
activity has held in abeyance until the Vietnamese actually
establish a policy working document with not just the IMF, but
the whole host of the donor countries. And so until that is
concluded, we're not going to continue, the IMF is not going to
work with the Vietnamese to conclude the ESF agreement. And
once that is in place, of course, then they'll move forward.
I just came from a donor's meeting on Monday in Hue city,
in which all of these points were reiterated with the
Vietnamese, the leadership, the Prime Minister was there, and
all of those points were made and we were given some assurances
that they were going to attempt to move forward on that area.
Chairman Crane. Mr. Jefferson.
Mr. Jefferson. Mr. Ambassador, it's good to see you here,
sir. I have often wanted to have you in a position where I
could ask you questions like this in public. [Laughter.]
Pete Peterson is my classmate; we came here together. We
made a good, strong friendship and I'm very happy that he is
doing as well as he is in the post that he's in, as we all knew
that he would. You can see since you've left I've moved up
quite rapidly, I'm here now as a Ranking Member, having moved
out Mr. Matsui just about 2 minutes ago. [Laughter.]
And imagine the Chairman, so yes, no telling when you come
back again what will be happening here Pete, but it's wonderful
to see you and I wish you the very best and I don't want to
really, now that I have the chance to ask you questions,
probably don't really want to ask you anything that is of much
moment. But I did have the chance in 1994 to travel to Vietnam,
which I know in those 4 years has changed dramatically from the
time because the changes were happening very rapidly with Mr.
Gibbons, who was then the head of the Trade Committee. And we
spent 4 days there in the northern and southern parts of
Vietnam. And we met with what was then a very small group of
people who called themselves the American Chamber of Commerce,
mostly in the southern part of the country. And they were
struggling to get a footing there, but optimistic about their
chances and hopeful that we would at that time restore our
diplomatic relations and move out our barriers to trade and
commercial activity with Vietnam which of course has happened.
And I know its all now in an embryonic stage and there's a lot
to be done to make all those promises real, but I want to ask a
question, not so much about the issue of opening our markets to
Vietnam, because I think we should do that, and I think that we
ought to move toward as normal a relationship as we can.
But I know that with the emerging economies it's very hard
for them to open their markets in ways that are important to
us, and they are still very protective in their minds that they
want to have access to our markets. What do you feel is the
mood of the Vietnamese Government toward opening Vietnam for
United States investment and for United States trade, and if
there's market access to the Vietnamese market?
Ambassador Peterson. They're frightened by the potential of
doing so, but they know they must do so ultimately. And as part
of our bilateral trade negotiations right now we're addressing
all of the points that you've just made. What will be America's
opportunities in Vietnam for investment and trade, national
treatment, the access for intellectual property right
protection, services, processes, all of those things are being
negotiated now in our bilateral trade agreement. And so, once
we conclude that, those guarantees that we've negotiated will
be honored in Vietnam.
Essentially, we're asking for reciprocity in all of those
things that we would do with them, and I feel confident that
ultimately we'll have a very strong trading relationship with
Vietnam. They are still not confident in their ability to
compete, and that's really one of the big drawbacks, and that
they don't have as much confidence in themselves as the rest of
the world community actually, because the Vietnamese have
proven themselves to, in some areas, at least, to be quite
competitive. And now they have to learn how to do that in a
much larger world market, and regardless of what they might do
with us, they are petitioning for accession to the WTO, and
have already committed to the WTO standards to the extent that
they want to join in the future, become a member of APEC this
year, and will have to concur to the restrictions and comply to
all of the aspects of that membership, and they will have to
also ultimately and very soon, actually, concur and follow the
prerequisites of trade amongst the ASEAN, because that's part
of their neighborhood. And they're gearing up their economy to
compete and to share reciprocity with their neighbor countries.
So by the time we get to a bilateral trade relationship with
them, they will have learned, and I think will be quite capable
of participating with the United States in an equal trade
relationship, the kind that we would expect from any other
country.
Mr. Jefferson. You may have already said it, and I may have
missed it because I came in after your testimony was complete,
but what do you see as the, what progress is being made on the
bilaterals and what timetable do you see that the bilateral
agreement being completed?
Ambassador Peterson. I don't think anybody can give you a
timetable. We just completed last month our fifth round of
talks with the Vietnamese, but this was one, the first one that
was really of substantive nature, because we now have from them
a very professional proposal on how to move forward with our
negotiations.
We've concluded those talks this last month with many
questions to be answered on their part and they have gone back
and are working on them. I have asked the Prime Minister just
as late as Monday to accelerate the work on that so that we can
get back to the table quickly, so that we don't lose the
momentum that we've established in these talks of last month.
So I suspect that the talks will be conducted again maybe
at the end of July in Hanoi. And we'll reengage too, as
aggressively as we possibly can. Now, when might it be
complete? There's still some very serious issues which need
additional work and so I would say that in the best-case
scenario, perhaps the end of this year, the first of next,
something could be concluded, but it may be way longer than
that.
Mr. Jefferson. The last thing is, what are some of the more
difficult areas of discussion and negotiation you're having
about the bilateral agreement?
Ambassador Peterson. The most difficult probably is the
investment area in that they just don't understand all the
details with that. And they just don't understand what all this
means to them and whether this puts them into jeopardy or
whether or not it is a benefit to them.
Mr. Jefferson. In multinational investment----
Ambassador Peterson. Exactly. And well, in American
investment specifically. They don't understand the concept of
services in the sense that we do in that it's construction as
well as a whole host of other things. And they at one time
said, ``well, we don't have any services, and so we don't need
this chapter.'' So we've brought them along quite a way on that
now, and so they are discussing with us on that.
IPR, intellectual property rights, is another area of
concern and it'll be, I'm sure that area that can be worked
out, but at this juncture it's still one of those things that's
difficult to conclude.
Mr. Jefferson. Thank you.
Chairman Crane. Well, again, Mr. Ambassador, we want to
express appreciation for the sacrifices you made to be here,
but also to commend you for the outstanding job that you've
been doing. Keep it up and we look forward to ongoing
communication with you on all of the issues of concern in our
bilateral relationships. And thank you.
Ambassador Peterson. Thank you, Mr. Chairman, and certainly
if the Subcommittee should want any updates, data, or any
assistance in formulating position papers or anything like
that, we'd be happy to provide whatever assistance you'd like
to have.
Chairman Crane. Thank you so much.
And now our next panel is Nguyen Dinh Thang, executive
director, Boat People, SOS; Y Hin Nie, president, Montagnard
Dega Association, Incorporated; Rong Nay, member of the
Montagnard Human Rights Committee; Ann Mills Griffiths,
executive director, National League of Families of American
Prisoners and Missing in Southeast Asia; and Lynn M. O'Shea,
New York State Director, National Alliance of Families for the
Return of America's Missing Servicemen.
Before you get seated, folks, let me alert you that the
bells have just gone off, and we're going to be interrupted
here by a vote. So you needn't necessarily get situated in the
chairs and wait here because I will recess the Subcommittee
subject to call of the Chair and it looks like we've got at
least two votes. Is it two?
Motion to recommit I think is the first, so we'll recess
subject to call of the Chair and there are at least two
forthcoming votes so you can relax and enjoy for awhile.
[Recess.]
Chairman Crane. Folks, would you all please take seats and
would our witnesses please take seats, and if you will please
defer to Ms. Griffiths, she has a national conference today
that she has to attend, so we'll let her go first and then
we'll proceed in the order that I asked you to come up here to
the table. Thank you.
Ms. Griffiths, and again, try and keep your oral
presentations to 5 minutes, and any written presentations will
be made a part of the permanent record, and the little light
here will give you an alert sign with the green and then yellow
and then red. And, Ms. Griffiths, please give us your
presentation.
STATEMENT OF ANN MILLS GRIFFITHS, EXECUTIVE DIRECTOR, NATIONAL
LEAGUE OF POW/MIA FAMILIES
Ms. Griffiths. Well, thank you, Mr. Chairman, and I
appreciate your consideration of our national conference. I do
welcome the opportunity to represent the POW-MIA families here
today. I do have a very brief statement to make, although I'm
discarding most of that; but I have a full statement with a
small attachment that I would like in the record.
Obviously these hearings are very timely, but hearings
before Congress are a sad occasion for the families, that it's
necessary to again appear. Given President Clinton's rhetoric,
we had in fact hoped, especially in his first 18 months, that
this issue would, as he stated, ``be the highest priority of
the relationship with Vietnam,'' and that normalization steps
would in fact be based, as a matter of reciprocity, to POW-MIA
accounting results. Sadly, any objective observer knows that
this is not the case. The administration's strategy, in our
view, was and is to move forward as rapidly as possible toward
normalization. That is their objective, regardless of whether
bilateral issues are resolved, POW-MIA as well as others, in
our view.
But to proceed in this way the administration had to ensure
that the POW-MIA issue was not fully integrated into policy,
and in fact they took several steps. Their strategy encompassed
downgrading intelligence collection and analysis, moving the
issue institutionally to the Department of Defense and to field
operations, then using those activities as the sole measure of
success.
These actions were then followed by certifications by the
President to Congress, and Cabinet level assurances that
Vietnam is fully cooperating, and this was reliant almost
solely on joint field operational reports and totally ignored
Vietnam's ability to unilaterally account for hundreds of
Americans not in crash or gravesites.
This has led to political appointees and newly assigned
career officers, who have little real knowledge and/or
background on the issue and of necessity accept the assurances
of their predecessors that all is going well. And that, in our
view, is the primary reason why the Vietnamese leadership no
longer takes this issue seriously.
I was at hearings yesterday, and although I was unable to
be here to hear Ambassador Peterson and Secretary Kartman, I
did hear Secretary Kartman yesterday, as I did the Principal
Deputy Assistant Secretary of Defense. In both cases, they
stated that they had moved in a very measured and marked way in
response to the tremendous cooperation being provided by the
Vietnamese. This hearing was held by your colleague, Mr.
Gilman, whom you know has a longstanding record on this issue.
My question at that hearing and today is: if the Vietnamese
are cooperating so fully, in such an outstanding, superb way,
as is claimed, then why is it that the POW-MIA families, and
specifically the National League of Families, which as you know
with your long history with us, has a record of total
responsibility, we don't make things up out of whole cloth, we
have always relied on the U.S. Government as our basis of
actual data and our expectations of what could be achieved. Our
charter and bylaws, is the fullest possible accounting. We have
never sought a full or complete accounting. That is impossible
in warfare, and we know that. The Vietnamese Government is
providing good cooperation to the field operators to conduct
joint field activities. That has a multipurpose benefit for
them, and some benefit for the POW-MIA accounting issue.
The benefit from their standpoint and the U.S.
Government's, the administration's, is that the larger the
field operation and the more widespread, the greater the
perception of full and complete cooperation, as has been
certified by the President. The fact of the matter is that
there's longstanding intelligence available to the U.S.
Government, and certainly the Vietnamese leadership knows this.
I've been dealing with them directly in numerous, I can't even
count how many delegations since 1982. And it is well known
that they are continuing to withhold relevant information,
including remains of Americans that have long been known
stored.
Our view is, what is sadly lacking here, and something
about which the operational commands and the Department of
Defense can do little, is the policy overall that the
leadership of our government, or our administration at present,
is to have high-level negotiations that not only raise this
issue. When they say that this is the first issue raised with
the Vietnamese, they're right. It is at the top of every
talking point. They must raise it, but that is before they go
on to what they all consider, or appear to consider, as the
really important things like trade, like the other issues of
bilateral interest to the United States.
Now we don't oppose MFN on ideological grounds. We support
it for Laos and Cambodia. We don't support it for Hanoi, for
the Vietnamese Government, because of their refusal of
cooperation to date on what they can provide on their own, not
jointly, and with that I'll close, and if I have to leave
before the questions and answers, my apologies, sir.
[The prepared statement follows:]
Statement of Ann Mills Griffiths, Executive Director, National League
of POW/MIA Families
Mr. Chairman, Members of the Committee......I welcome this
opportunity to represent the POW/MIA families at this important
hearing. The timing is vital, and Congressional attention is
urgently needed. We appreciate your efforts over the year, Mr.
Chairman, and know that achieving the fullest possible
accounting has long been a shared objective, one very close to
your heart.
Throughout the years since the National League of POW/MIA
Families was formed in May, 1970, there have been many
difficulties and obstacles. The POW/MIA issue from the Vietnam
War, as compared to other wars, is very different. Not only was
there no timely U.S. access to the battlefields, but the U.S.
faced a national Vietnamese policy of well orchestrated
exploitation of the issue for their political and economic
objectives, as well as domestic divisiveness.
The greatest challenges came during the immediate post-war
period, and they were very tough to overcome. Then, from 1981-
92, the primary U.S. objective with Vietnam was accounting as
fully as possible for America's POW/MIAs, anticipating that
satisfactory resolution could allow the United States and
Vietnam to move toward normal relations after a Cambodia
settlement. It was during this period that most accountability
occurred.
The Clinton Administration has rhetorically taken the same
public stance regarding highest priority on resolving the POW/
MIA issue but, operationally, POW/MIA objectives are not being
met. Although the process of joint cooperation has brought some
success, especially in Laos, POW/MIA accounting from Vietnam
has been minimal when compared to official, long-established
expectations.
The most glaring challenges the League now faces are U.S.
policy that continues to provide incentives to Vietnam without
performance on unilateral actions to account for Americans,
including repatriation of remains that cannot be recovered in
the field, and accounting for last known alive discrepancy
(LKA) cases, directly linked to confirmed data which Vietnam is
withholding from U.S. researchers.
Today, 2,089 Americans are still missing and unaccounted
for from the Vietnam War, though there are approximately 50
``sets'' of remains in varying stages of the identification
process. About half of the total were originally carried as POW
or MIA; the other half were original-status KIA/BNR, or killed-
in-action/body-not-ecovered.
Statistical data surrounding this issue changes constantly,
but one crucial, though seldom mentioned, fact is that it is to
Vietnam that the U.S. must turn for accountability on most
missing Americans, regardless of where the loss occurred. Even
in Laos, where 447 are still missing, over 80% were lost in
areas under Vietnamese control at the time; in Cambodia, the
figure is 90% of the 75 U.S. losses.
The League definition of accountability, long ago accepted
officially as well, is the missing man returned alive, or his
identifiable remains or convincing evidence as to why neither
is possible, in which case the individual's name stays on the
list as unaccounted for, but there is little to no expectation
of remains recovery.
Our expectations, based upon official information and other
evidence, have long been realistic. We accept the nature of war
that does not allow answers on all the missing. Knowing the
historical record, understanding the volume of intelligence
data and having witnessed Hanoi's manipulation of the issue for
decades, the League also recognizes approaches that work,
versus those that do not.
On Veterans Day of last year, President Clinton stated,
``Let us never waiver for a moment in our common efforts to
obtain a full accounting for all our MIAs.'' The public appeal
received sustained applause, as expected, but it should have
been in the form of a policy directive to some administration
officials who fail to treat the POW/MIA issue seriously.
In February of this year, the President affirmed in a
letter regarding a Jackson-Vanik waiver for Vietnam that
``obtaining the fullest possible accounting of our missing from
the Vietnam War is the highest priority in our relations with
Vietnam.'' The President's assurances are welcome, but
officials in his administration do not implement his
commitments seriously. Some either do not accept the validity
of the President's stated policy, or they elect to ignore the
direction given.
Last year, Congress discovered that the intelligence
priority enjoyed by the POW/MIA issue in the 1980s and early
1990s was removed from presidential directives in 1995. It took
significant effort to obtain a pledge from the administration
to restore the priority, and an independent analytic capability
in the intelligence community still has not been established.
The President's 1997 certification to Congress that Vietnam
is ``co-operating in full faith'' was not accurate. According
to findings in a 1997 Senate Select Committee on Intelligence
staff inquiry, ``The intelligence community appears to have
played no formal analytic role in the determinations''
regarding Vietnam's cooperation. The President's certification,
based upon staff recommendations, was heavily influenced by
economic interests, an amorphous desire to ``heal'' and
Vietnam's skillful implementation of its own policy.
Much has been and is being heard on Capitol Hill and in the
media about the Jackson-Vanik Amendment, covered in Title IV,
Section 402 of the Trade Act of 1974, dealing with free
emigration. Very little was or is heard about the Gurney-Chiles
Amendment covered in Title IV, Section 403, an effort to get
all countries to assist in accounting for missing Americans.
The League is very familiar with the Gurney-Chiles
provisions. In fact my father, the late Mr. E.C. Mills, then
serving as League Executive Director, testified on this very
issue before this Committee, though at the time it was the
Committee on Foreign Affairs, chaired by your former colleague,
the esteemed Clement Zablocki.
We were not the only ones to recognize this vital link;
apparently, the Clinton Administration did as well. The
President's March 4th certification that Vietnam was ``fully
cooperating in good faith'' missed congressional deadlines, but
was timed to coincide with the strategy for gaining
Congressional approval of the President's March 11th decision
to grant the Jackson-Vanik waiver.
Hanoi's reaction to the waiver was predictable. Unlike some
U.S. officials and businessmen, the Vietnamese foreign ministry
``gave a cool welcome to the decision, calling it reasonable
and a step toward normal economic relations,'' according to
press reports. Anxious to achieve their highest priority--Most
Favored Nation trade status--officials in Hanoi treated the
waiver as routine and justified, merely another step along the
path to normal diplomatic and economic relations that this
administration has pursued with inordinate urgency, given the
lack of Vietnam's critical economic and strategic import to the
United States.
The League's opposition to MFN for Vietnam is not
ideological, but based upon Hanoi's failure to take unilateral
actions that could account for hundreds of missing Americans.
We have long supported MFN for Laos and Cambodia due to both
countries' historical record of far more serious accounting
efforts.
Obvious manipulation continues to come from Hanoi--from
Vietnam's leadership, not the Vietnamese people. To objective
observers, Hanoi's record over the years proves our point.
Vietnam's leadership has enjoyed tremendous continuity through
seven U.S. administrations, and they have not been reluctant to
exploit those changes, alternating between surges of
cooperation and stonewalling.
There is apparent unwillingness, however, by current U.S.
officials to recognize and accept as valid Vietnam's
manipulation of the issue, including Hanoi's failure to account
for the most obvious cases of Americans last known to be alive.
Now, the official statements refer to last known alive cases as
``down to 48'' from 196, without any reference to the fact that
the remains of nearly all of these men have not been returned--
they should be the easiest to account for by returning remains,
not the hardest, as alleged by this administration, since they
obviously were not destroyed in an aircraft crash.
Administration officials also ignore a direct 1985
admission by a member of the Vietnamese Politburo to a White
House official that hundreds of remains were being withheld.
Since 1990, Vietnam has failed to renew unilateral repatriation
of stored remains, and, ironically, U.S. policy-makers seem to
accept the Politburo's failure to authorize such full
cooperation as somehow proving that there are no more
available. Why? Presumably because acknowledging that Vietnam
is withholding remains and information, rather than being fully
cooperative, is counter to the Clinton Administration's real
objectives--full normalization regardless of the cost to
achieving the fullest possible accounting.
Despite these circumstances, long before it was politically
correct, the POW/MIA families supported humanitarian aid to the
people of Vietnam, Laos and Cambodia through assistance to the
disabled, school con-struction and other projects. We still do.
We also support a rational policy to meet Vietnam's political
and economic objectives--as they meet ours in terms of
accounting for missing Americans--not payment in advance in the
naive hope that Vietnam will respond in good faith.
Over the years, there have been obstacles that arose
domestically, whether from self-deluded RAMBOs, apologists for
U.S. involvement in the war, or con-artists who preyed upon
some families, veterans and the general public. One of the
greatest frustrations has come from un-informed people who, in
the name of undefined ``healing'' and ``putting the past
behind,'' seem to believe that facts, evidence, principles and
justice for those who serve can be ignored. Such a mentality
assumes that commitments can be summarily dismissed to pursue
economic and political objectives, even when answers are being
deliberately withheld, as is the case with Vietnam.
Ending uncertainty and bringing facts to waiting families
and our nation has been the League's mission for nearly three
decades, during which I have served nearly twenty years as
Executive Director. Our expectations are realistic. The
families simply want answers that, according to senior U.S.
officials over many years, could readily be provided on
hundreds of missing Americans if the Vietnamese leadership
makes the decision to cooperate seriously.
Overcoming current challenges requires an educated,
committed executive branch, backed by informed families,
veterans and Members of Congress, unified behind an approach
that can succeed. We long ago recognized the need for active
involvement by the veterans community. Support from America's
veterans not only enables the League to continue to fight for
answers, but helps ensure that Congress and the Executive
Branch clearly understand that this issue must be resolved. The
United States must send a clear signal that those who serve our
nation are not expendable, that they will be accounted for if
it is humanly possible.
The Vietnam War POW/MIA issue, and specifically the efforts
of the League, brought significant changes to our nation and to
the world. This is a contribution of which we are, justifiably,
proud. In Desert Storm, unprecedented efforts were made to
account as fully as possible for America's POW/MIAs before U.S.
troops were withdrawn. Russia is now seeking to account for her
missing in Afghanistan and Chechnya; Kuwait seeks answers for
citizens held and missing in Iraq; Israel is still seeking the
return of her POWs from Lebanon; and the Croatians search for
men unaccounted for in Serb-controlled Bosnia. All have come to
the League for advice. Our quest to account for America's POW/
MIAs from the Vietnam War has given rise to international
recognition: you can blame the war, but don't blame the
warrior.
The League's POW/MIA flag is now the recognized symbol of
the principle of nations seeking accountability for those who
serve. Last year, Congress passed, as part of the Defense
Authorization Act for FY98, language that mandates flying our
POW/MIA flag six days each year: Armed Forces Day, Memorial
Day, Flag Day, Independence Day, National POW/MIA Recognition
Day and Veterans Day. On permanent display in the U.S. Capitol
Rotunda since March 9, 1989, the League's POW/MIA flag now is
to be flown on the grounds or in the public lobbies of all
major military installations; all Federal national cemeteries;
the Korean War and National Vietnam Veterans Memorials; the
U.S. Capitol; the White House; offices of the Secretaries of
State, Defense and Veterans Affairs (where it now flies daily)
and the Director of the Selective Service System; and at all
offices of the U.S. Postal Service. Passage was supported by
the League and all major national veterans organizations.
The League and our nation's veterans have fought for
answers because it is the right thing to do. The Vietnamese
people suffered much greater loss of life than we in America,
but Vietnam's unaccounted for citizens are known dead, body not
recovered. There are no Vietnamese MIAs! Families in Vietnam
have no uncertainty except for the location where
their loved ones are buried, and that is tragic enough. It
is, however, important to distinguish between the two issues.
Vietnamese KIAs were not only buried in unmarked graves,
but will never be accounted for in terms we recognize. Even
with the assistance of American veterans in providing relevant
information, the Vietnamese have no medical records or other
data against which to compare remains and material that may be
recovered. Unlike the Vietnamese leadership, the United States
was not and is not withholding the identifiable remains of
Vietnamese citizens, nor information that could help account
for them. Therein lies the core difference on that element of
humanitarian reciprocity.
Answers can come on many more American POW/MIAs. The
timing, however, depends primarily upon whether the Clinton
Administration reestablishes the principle that the pace and
scope of U.S. responses to Hanoi's priorities will be directly
related to their unilateral accounting actions.
As in the past, Hanoi's response will be based upon self
interest. If the President and senior U.S. officials
demonstrate seriousness and commitment, the leadership of
Vietnam will respond. Unified determination to succeed--by the
POW/MIA families, our nation's veterans, the American people
and our representatives in Congress--can ensure that the
Clinton Administration implements the President's commitments
with the integrity that America's missing veterans demonstrated
by their honorable service in the cause of freedom.
Thank you, Mr. Chairman. I look forward to your questions.
Chairman Crane. We understand that, and we thank you for
your presentation, Ms. Griffiths.
Next is Dr. Thang.
STATEMENT OF NGUYEN DINH THANG, EXECUTIVE DIRECTOR, BOAT PEOPLE
S.O.S., MERRIFIELD, VIRGINIA
Mr. Thang. Thank you, Mr. Chairman, and Members of the
Subcommittee. Today I speak on behalf of the Boat People
S.O.S., but I am quite convinced that I also represent the view
of the majority of Vietnamese-Americans in this country.
According to a poll conducted by the Orange County Register the
day after the waiver was granted to Vietnam, 93% of all
Vietnamese-American respondents opposed that waiver.
Three months ago, President Clinton granted Vietnam the
waiver to the Jackson-Vanik amendment, contending that it would
substantially promote free and open emigration. Under that
amendment, free and open emigration means: one, no citizen
should be denied the right or opportunity to emigrate. And two,
no citizen should be made to pay more than a nominal fee on
emigration on the visas or other required documents for
emigration.
After the waiver, Vietnam has substantially slowed down its
clearance of eligible applicants, not the other way around.
Senator Kerry did quote a number, 15,000 cleared for interviews
so far under the ROVR Program. However, he forgot to mention
that the vast majority of those names already cleared, that is,
14,000 than before the waiver. Since the waiver, over the past
3 months only about 1,000 have been cleared so far, so that's
very indicative of a major slowing down in the processing of
these cases.
And Ambassador Peterson did mention that, did acknowledge
that's the problem, but he explained in a way that since we are
getting to harder cases to deal with. He quote that some of the
cases might have been involved in criminal activities, others
had wrong addresses. Well, in Vietnam, criminal activities
might mean political activities not permitted or not allowed by
the Vietnamese Government there. Actually we have submitted the
State Department a long list of about 600 cases and so far we
have received very few replies from State Department on those
cases. We did include the addresses along with the list.
And now since, actually back in March the State Department
was very optimistic. They told us that they expected that the
remaining caseload of 4,000 names would be cleared by the end
of March. We are now already in June and still 2,000 cases are
still waiting for clearance, not to mention 1,200 case
individuals have been already denied clearance for interview
altogether.
Regarding applicants under the HO program, there has been
very little to no progress whatsoever. Among the 900
Montagnards that have been of interest to the United States,
since the waiver only 3 percent have been granted clearance for
interview. Of the 6,000 former political prisoners and former
U.S. employees under the same program, since the waiver, again
only 3 percent have been cleared for interview.
I don't think that with those figures anyone could say with
a clear conscience that there has been substantial promotion of
free and open emigration since the waiver. We have documented
numerous cases of former political prisoners, religious
leaders, immediate relatives of U.S. citizens, former
commandoes, former U.S. Government employees, so on and so
forth, who have been exiled to remote areas and banned from
contacting any foreigners altogether. Their names do not even
make it to the list of the U.S. Government. And there's not
much our government can do to help. Under the current
arrangement with Vietnam the United States is not allowed to
contact these people directly. Not until Vietnam has cleared
them for interview. So we are in a catch-22 situation here.
Late last year I took part in a congressional staff
delegation to Vietnam. We included one such case among the list
of people that we would like to visit. And our Embassy in Hanoi
submitted that list of names. And we are not allowed to visit
this particular individual. Just yesterday I receive a message
of despair from this person through his friends saying that he
had been investigated and interrogated multiple times ever
since about how his name got on our list. So many are the
reasons for which an applicant may be denied emigration. For
instance, I know the wife of a Montagnard now in North Carolina
was offered exit permission only on the condition that she
renounce her religion. She didn't and she's still in Vietnam.
That's not the case of a refugee who was allowed to leave only
if he leaves his wife, real wife and children behind and takes
substitutes assigned by the government as condition for exit.
And not too long ago a former political prisoner came to me and
ask for assistance because he had been told by the Vietnamese
Government that he had to commit himself to gather intelligence
once he arrived in the United States for the Ministry of
Interior of Vietnam as condition for exit. And he was very
frightful because if he didn't cooperate, then his children
still back in Vietnam will suffer the consequences.
I know that my time is up and therefore I would like to
stress on one major area that has been ignored altogether in
all the previous testimonies, especially from the State
Department and from Mr. Kerry, and that is the issue of
corruption. There's rampant corruption in Vietnam that has
marred the entire emigration process. We have documented cases
and we would like to submit in confidence to this Subcommittee
the statement of two newly arrived refugees. One had to pay
$500 and the other one $3,000 in exchange for exit permission.
In conclusion, I would like to suggest the following
conditions for the extension of the waiver. One, Vietnam has to
agree to expeditiously clear the entire ROVR caseload for
interview including the 1,200 people who are denied clearance.
Two, to give the United States full and direct and unhindered
access to our applicants of interest to the United States. And
three, a concrete and immediate step to combat corruption
throughout the emigration process. Thank you, Mr. Chairman.
[The prepared statement follows:]
Statement of Nguyen Dinh Thang, Executive Director, Boat People S.O.S.,
Merrifield, Virginia
Mr. Chairman and distinguished members of the Subcommittee,
I am Nguyen Dinh Thang, Executive Director of Boat People
S.O.S., a human rights and refugee rights organization that has
worked on issues related to Vietnamese refugees and immigrants
for almost two decades. Today I would like to present hard
numbers and facts that are self-explanatory about Vietnam's
attitude towards free and open emigration. I also would like to
raise my concern over the Administration's foreign policy
towards Vietnam in the broader context of human rights and
trade.
Three months ago President Clinton granted Vietnam waiver
to the Jackson-Vanik Amendment. His justification is that the
waiver will substantially promote free and open emigration.
Under the Jackson-Vanik Amendment, free and open emigration
means: (1) no citizen should be denied the right or opportunity
to emigrate, and (2) no citizen should be made to pay more than
a nominal tax, levy, fine, fee on emigration or on the visas or
other documents required for emigration.
After the waiver, Vietnam has substantially slowed down its
clearance of eligible returnees for interview under the
Resettlement Opportunity for Vietnamese Returnees (ROVR)
program. This program was officially announced in April 1996.
After 18 months of foot-dragging, Vietnam suddenly cleared for
interview 14,000 of the 18,000 persons of interest to the U.S.,
all of this within a period of three months leading to the
waiver. The State Department was optimistic that the remaining
4,000 names would be cleared before the end of March.
We are now in the second half of June and some 2,000 names
are yet to be cleared. Worse yet, Vietnam has already denied
interview clearance to over 1,200 eligible returnees. Based on
some 600 cases that we have compiled and submitted to the State
Department, I have reasons to believe that many victims of
persecution with the most compelling refugee claims are among
those denied access to U.S. interview. I have brought to the
attention of the State Department a significant number of
returnees currently under house arrest, in prison or in hiding.
Similarly there has been little progress in the HO program,
which resettles former U.S. employees and former political
prisoners. Of the 900 Montagnards that the U.S. has tried to
gain access to for years, only 3% have been granted exit
permission since the waiver. Thousands of former political
prisoners denied exit permission prior to the waiver are still
without exit permission after the waiver.
I have also worked on numerous cases of beneficiaries of
current immigrant visa petitions or religious visa petitions
who continue to be blocked from U.S. interviews. Appeals by
their U.S. relatives or U.S.-based religious institutions to
Ambassador Pete Peterson, to Vietnamese Ambassador Le Van Bang,
to the State Department, and intervention by members of
Congress have been fruitless.
With the above facts and figures I cannot see how any
sensible and fair person could argue that the waiver has
substantially promoted free and open emigration. Vietnam has
become less, not more, cooperative after the waiver.
The problem is actually many times worse than those numbers
may show. Most emigration applicants must pay hefty amounts of
bribes in exchange for required documents, clearance and exit
permit. I have interviewed many of these victims who arrived in
the U.S. in recent months. Some of them had to pay several
hundred dollars; others several thousand dollars; and many had
to practically give away their houses and other properties to
state officials. Considering the average annual per capita
income in Vietnam is only 250 dollars, such payments cannot be
characterized as nominal. Those who cannot afford such bribes
are often excluded from emigration altogether. I would like to
submit in confidence to the subcommittee signed statements of
two witnesses who recently arrived in the U.S. One had to pay
500 dollars, the other 3,000, in order to get clearance for
interview with the U.S. delegation.
Because it has nothing good to say, the State Department
chooses to ignore such corrupt practices, which constitute a
gross violation of the Jackson-Vanik Amendment, altogether.
The problem is even uglier if we look beyond the Jackson-
Vanik Amendment. I have worked on the case of a Montagnard now
in North Carolina whose wife in Vietnam is offered exit
permission only if she renounces her religion. She refuses and
is still in Vietnam. I know another case who must leave his
real wife and children back in Vietnam, and take substitutes
assigned by the government as condition for exit permission. A
former political prisoner, now living in Washington DC, has
come to me to ask for help because Vietnam's Ministry of
Interior had required that, once in the U.S., he gather
intelligence for them as condition for his exit; his relatives
left in Vietnam would suffer the consequences if he fails to
cooperate. I am quite certain that the State Department is
aware of but would like to overlook such problems.
Earlier this year, President Clinton opposed the Freedom
from Religious Persecution Act on the ground that the threat of
mandatory sanctions would cause U.S. officials to overlook the
problem so as to avoid the imposition of the sanctions. I
believe he spoke from experience. That is exactly how the
Administration acts with respect to Vietnam, not only on the
issue of free and open emigration, but also on the broader
issues of human rights and trade.
In July 1995, when President Clinton normalized relations
with Vietnam, the Administration reassured skeptics that such a
move would promote democracy and human rights in that communist
country. Since then, the Communist government has further
tightened its grip over its citizens. The number of imprisoned
religious leaders and political dissidents has gone up, not
down. So has the number of ordinary citizens detained and
charged for criticizing corruption in government, and the
frequency and severity of reprisals against independent voices
in the government-controlled press. December of last year, I
took part in a Congressional staff fact-finding mission to
Vietnam. On our own initiative, we talked to several
intellectuals, dissidents, ordinary people, and even members of
the Communist party. The consensus was that human rights
conditions had deteriorated since normalization.
Last year, when President Clinton pushed for ``fast track''
authority, the Administration convinced Congress and the
American people that it will ensure that trade expansion will
promote workers rights. However, within a day of the President
Clinton's announcement of the Jackson-Vanik waiver for Vietnam,
the Overseas Private Investment Corporation (OPIC) hurriedly
announced programs in Vietnam, despite a statutory requirement
that OPIC should not operate in any country that violates basic
international labor standards. Knowing that workers are not
allowed to form independent labor unions and that forced labor
remains common practice in Vietnam, OPIC bypassed the
requirement with a waiver.
Aggressively pushing for expanded trade with Vietnam, the
Administration seems intent on glossing over rampant and
uncontrollably spreading corruption in that communist country,
which not only violates the Jackson-Vanik Amendment but will
also affect the health and fairness of trade between the U.S.
and Vietnam. A survey published in April by the Hong Kong-based
Political and Economic Risk Consultancy (PERC) ranks Vietnam
the third most corrupt Asian country, only ahead of Indonesia
and Thailand. A report issued by the United Nations Development
Program four days ago warned that serious lack of transparency
in financial dealings means peril and trouble for Vietnam in
the months ahead. In two weeks, Vatico Inc., the first American
firm licensed to operate in Vietnam, will close shop after 6
rough and unprofitable years. Its president was quoted in the
press that he would be surprised ``if 10 percent of foreign-
invested companies in [Vietnam] are making a profit.'' Twenty
years ago Congress passed the Foreign Corrupt Practices Act.
With regard to Vietnam, this Act may face the same fate as the
Jackson-Vanik Amendment and the statute on OPIC.
Worst of all, Vietnam seems to know how our Administration
thinks and acts. Let me quote an electronic message from a
high-ranking Communist official whose email address, although
based in Thailand, can be traced all the way back to Hai Phong,
North Vietnam. This message was sent to us a few days ago: ``I
believe that US now or later would have to waive the Jackson-
Vanik for Vietnam but the problem is when. And so why don't
Vietnamese overseas support such a move but go against it? If
Vietnam's economy develops, they at least can be proud that
their homeland would not be in the list of poorest countries in
the world. I believe the human rights issue is the western
issue to rule Asian countries more than actually from their
heart.''
It is time that we send a different message to Vietnam,
that our Administration speaks from its heart, not its lips.
In her testimony before Congress on February 23rd of this
year, Secretary Julia Taft, representing the State Department,
reassured Congress that if Vietnam fails to live up to its
promised cooperation with U.S. resettlement programs, the State
Department would recommend that the waiver to the Jackson-Vanik
Amendment be rescinded. Vietnam does not keep its words; our
State Department should.
Dr. Nguyen Dinh Thang grew up in South Vietnam and entered
college after the communist takeover in 1975. He escaped by
boat to Malaysia in 1978 and arrived in the U.S. seven months
later.
He obtained his doctorate in Mechanical Engineering from
Virginia Tech in 1986 and since then has worked as an engineer
at David Taylor Research Center. Ever since his arrival in the
U.S., he has been active in the refugee community. In 1986 he
founded the College Entrance Preparation program for newly
arrived immigrants and refugees. In 1988 he joined Boat People
S.O.S. and became its Executive Director in 1990. In the same
year he co-founded Legal Assistance for Vietnamese Asylum
Seekers (LAVAS), a project sending pro bono lawyers and
paralegals to first-asylum camps to assist Vietnamese boat
people in their application for refugee status.
In December of last year, Dr. Thang took part in a
Congressional staff delegation to Vietnam to look into the
conditions of repatriated boat people and into the general
human rights conditions in Vietnam.
Dr. Thang presently serves as the President of the
Vietnamese Community of Washington, D.C., Maryland and
Virginia.
Chairman Crane. Thank you, Dr. Thang.
Mr. Nie.
STATEMENT OF Y HIN NIE, PRESIDENT, MONTAGNARD DEGA ASSOCIATION,
INC., GREENSBORO, NORTH CAROLINA
Mr. Nie. My name is Y Hin Nie. On behalf of Montagnard Dega
Association, I would like to thank----
Chairman Crane. Wait just a moment. You might pull that
microphone--there you go. Thank you.
Mr. Nie. I want to thank Chairman Crane for his help in
bringing about this hearing. And further, I want to thank all
the Members of the Subcommittee in holding these hearings on
United States and Vietnam trade relations, including the
present renewal of Vietnam waiver under the Jackson-Vanik
amendment, and their interest and assistance in this matter and
emigration policy and practice in Vietnam.
And particularly, I want to talk about Montagnard
reunification, as the Montagnard people believe in the
trustworthiness of the United States of America and as a leader
of democratic freedom and we place our trust in today's
hearing.
And since 1975, most of our people who immigrated to United
States as refugees were combatants against Communist tyranny,
in the aftermath Vietnam unification. And allow me to sketch
out the role of history of Vietnam and the United States. I
will then focus on the human rights violations of emigration,
persecution, and restrictions on free emigration for our
Montagnard people suffering in central highlands of Vietnam.
The Montagnard people were among those suffering the most
from the Vietnam war. Our recent history is rooted in events
during and after the war. And during the Vietnam war many of us
were compatriots with the U.S. Army groups. On March 30, 1998,
on the History Channel, they profiled the Special Forces' role
in the Vietnam war prior to 1975. Retired Green Berets who were
interviewed stated that the Montagnards would sacrifice their
lives to protect American lives. And our association with the
Special Forces and veterans' service organizations was evidence
of Montagnards' traitorous status to the post-1975 Communist
Government of Vietnam. And consequently, restrictions were
placed on Montagnards and those who might wish to help.
Similarly, the Hanoi government has denied exit visas for
spouse and children who want to reunite with their family in
United States.
The Jackson-Vanik amendment prohibits certain commercial
relations with a country that engages in practices prohibiting
and severely restricting free emigration of its citizens and
specifically identifies such practice as: denying its citizens
the right politically to emigrate and, second, as imposing more
than a nominal tax on emigration or documents required for
emigration; and, third, imposing more than a nominal tax on a
citizen as a consequence of his desire to emigrate to the
country of his choice. And consequently, as Montagnards, we are
similarly opposed to any waiver of the Jackson-Vanik amendment
or the easing to any and all restrictions already placed on the
Government of Vietnam until certain practices are greatly
improved.
The State Department is aware of 893 Montagnards who were
not granted any sort of interview. In fact, a notification of
the interviews were never made or delivered to any Montagnard
applicants whose names appear on the State Department document
under the ODP Program, Bangkok. In addition, 531 at the time of
interview were denied, including 100 Amerasian children.
Many of the Montagnards have waited years and years to be
reunited with loved ones. The ODP Bangkok office has notified
many applicants that they must have prior approval from the
United States and Vietnam Governments before exit visas will be
granted. And Julia Taft, a representative of the United State
Department of State, stated in her letter on March 10, 1998, at
the last Senate Committee hearing, that ``On February 26, the
Vietnam Ministry of Foreign Affairs informed us that staff from
the Ho Chi Minh City Ministry of Interior Office had already
traveled to central highlands to interview the Montagnards on
the ODP list and that ODP would be able to interview them
soon.''
Then Ms. Taft went on to say that, ``This was good news,
but I want to assure you that we will not put this issue to
rest until we are granted access to all eligible Montagnard
cases.'' To date, this has not happened.
I would like to suggest, if I may, that a Montagnard
interpreter accompany the JVA officers to three provinces,
Pleiku, Daklak, and Dalat in the central highland of Vietnam
for the Montagnard case. In doing so, facilitating a clear
picture of the barriers might be possible.
With respect to the aforementioned issues on behalf of the
Montagnard people, I would like to strongly encourage this
Subcommittee to support the Jackson-Vanik amendment, in the
hope that issues concerning human rights in Vietnam and
emigration practices of the Hanoi authority may be overcome.
The Clinton administration should not renew the Jackson-Vanik
waiver until Montagnards and other ethnic groups and Vietnamese
are allowed to freely emigrate. Please, this is the only
honorable and just course for the United States in its
relationship with Vietnam.
God bless you and America. Thank you, Mr. Chairman.
[The prepared statement follows:]
Statement of Y Hin Nie, President, Montagnard Dega Association, Inc.,
Greensboro, North Carolina
The Honorable Philip Crane
Ladies and Gentlemen:
My Name is Y Hin Nie. On behalf of the Montagnard Dega
Association, I want to thank Congressman Crane for his help in
bringing about this hearing. Further, I want to thank the
members of the Subcommittee holding these hearings on U.S.-
Vietnam trade relations, including the President's renewal of
Vietnam waiver under the Jackson-Vanik amendment to the act of
1974 for their interested and assistance in this matter of
emigration policies and practice in Vietnam. Particularly in
the Montagnard Reunification family cases. The Montagnard
people believe in the trustworthiness of the United States of
America and as a leader in democratic freedoms. We place our
trust in today's hearings.
Since 1975, most of our people who immigrated to the United
States, as refugees, were combatants against Communist tyranny,
in the aftermath of Vietnam's unification. Allow me to sketch
our role in the history of Vietnam and the United States. I
will then focus on the human right violations of immigration,
persecution and restrictions on free emigration for our
Montagnard people suffering in the Central Highlands of
Vietnam.
The Montagnard people were among those who suffered the
most from the Vietnam War. Our recent history is rooted in
events during and after the War. During the Vietnam War, many
of us were compatriots with U.S. Army groups. On March 3, 1998,
the History Channel profiled the Special Forces' role in the
Vietnam War, prior to 1975. Retired Green Berets who were
interviewed stated that Montagnards would sacrifice their lives
to protect Americans' lives. Our association with the Special
Forces was evidence of Montagnards' traitorous status to the
post-1975 communist government of Vietnam. Consequently,
restrictions were placed on Montagnards and those who might
wish to help. Similarly, the Hanoi government has denied exit
Visas for spouses and children who want to reunite with their
families in the United States.
The Jackson/Vanik Amendment prohibits certain commercial
relations with a country that engages in practices prohibiting
or severely restricting free emigration of its citizens and
specifically identifies such practices as: (1) denying its
citizens the right or opportunity to emigrate; (2) imposing
more than a nominal tax on emigration or documents required for
emigration; (3) imposing more than a nominal tax or other
charge on a citizen as a consequence of his desire to emigrate
to the country of his choice. Consequently, as Montagnards, we
are severely opposed to any waiver of the Jackson/Vanik
Amendment or the easing of any and all restrictions already
placed on the Government of Vietnam until such emigration
practices are greatly improved.
The State Department is aware of 893 Montagnards who were
not granted initial interviews. In fact, notification of any of
the interviews were ever made or delivered to any of the
Montagnard applicants who's names appear on the State
Department documents under the ODP Program, Bangkok. In
addition, 531 at the time of interview were denied including
100 Amerasian children.
Many Montagnards have waited years and years to be reunited
with loved ones The ODP Bangkok office has notified many
applicants that they must have prior approval from the US State
and the Vietnamese Government before exit Visas will be
granted. Julia E. Taft, a representative of the US State
Department, stated in her letter of March 10, 1998 at the last
Senate Subcommittee Hearings that ``on February 26, the
Vietnamese Ministry of Foreign Affairs informed us that staff
from the Ho Chi City Ministry of Interior office had already
traveled to the Central Highlands to interview some of the
Montagnards on the ODP list and that ODP would be able to
interview them soon.'' Ms. Taft went on to say that ``this was
good news, but I want to assure you that we will not put this
issue to rest until we are granted access to all eligible
Montagnard cases.'' To date, this has not happened.
I would like to suggest, if I may, that a Montagnard
interpreter accompany the JVA officer to the three provinces
Pleiku, Daklak, and Dalat in Vietnam to interview Montagnard
cases. In doing so, facilitating a clearer picture of the
current barriers might be possible.
With respect to the affore mentioned issues, on behalf of
the Montagnard people, I would like to strongly encourage this
subcommittee to support the Jackson/Vanik Amendment of 1974 in
the hope that issues concerning Human Rights in Vietnam and the
emigration practices of the Hanoi Authority may be over-come.
The Clinton Administration should not renew the Jackson Vanik
waiver until Montagnards and other Vietnamese are allowed to
freely emigrate. Please. This is the only honorable and just
course for the U.S. in its relationship with Vietnam. God bless
you and the United States of America. Thank You.
Chairman Crane. Thank you, Mr. Nie.
And our next witness is Mr. Nay.
STATEMENT OF RONG NAY, MEMBER, MONTAGNARD HUMAN RIGHTS
COMMITTEE, CARY, NORTH CAROLINA
Mr. Nay. Honorable Chairman Phil Crane and ladies and
gentlemen, my name is Rong Nay. I'm a member of the Human
Rights Committee of the Montagnard people. I would like to
thank Chairman Crane, and the Members of the Subcommittee, for
consideration of the Jackson-Vanik amendment for free
emigration and trade with Vietnam.
Today we are honored to have our voice heard. In Vietnam,
please understand that the Montagnard/DEGA indigenous people
have no voice to be heard--no true voice. We cannot get our
families out of Vietnam. We cannot worship our Christian faith
freely. We cannot receive humanitarian aid. We cannot have the
same opportunities in education and development as the
Vietnamese. Ambassador Peterson knows clearly about this, as
does the U.S. State Department.
We pray that the Vietnamese Government will hear our voice
today. We ask only to be treated as human beings. We love our
families, our children, just the way the Vietnamese do. Why
can't we get our families out of Vietnam? Why does the
Vietnamese Government continue to punish the Montagnard people
just because we are an indigenous people or we fought and died
alongside Americans?
The intention of the Jackson-Vanik amendment is to promote
free emigration, but the Montagnards are still suffering and
are separated from their families. We are so sad that in
Vietnam we are forced to substitute Vietnamese people into our
family units, just so that half of our families can get exit
visas to leave Vietnam. And, also, the Vietnamese Government
forces our people to pay a huge amount of money to obtain the
exit visa or we must substitute a relative of a police officer
in order that their children can have the opportunity to get in
the United States to study.
Please believe us; these are the facts. This is against the
law and policy of the United States. Our Montagnard people have
been discriminated against for years, but now we are being told
we must split our family, in order that some of us can have
freedom in America.
Why do the Vietnamese punish us? Because during the United
States backing of South Vietnam in the Vietnam war, America's
Special Forces have been recruiting and training thousands of
the Montagnard group, who fought alongside the Americans with
loyalty, bravery, and friendship. The Montagnard bonded to the
Americans as their only true allies during the war. During
Vietnam war, more than a million of the Montagnard were killed;
85 percent of the Montagnard villages were abandoned or
destroyed.
Please don't turn your back on us. We need your help. We
don't hate the Vietnamese. We respect the Vietnamese great
culture and their struggle for sovereignty against China and
other countries. Yet, the Montagnard, too, want our people to
survive and develop.
But then the Vietnamese Government writes ``FULRO, Anti-
Revolutionary'' on the paperwork of our people. This is a
technique to stop our people from emigrating to the United
States. The FULRO was the Montagnard Resistance Movement, but
it no longer exists. In the past, the U.S. military supported
our people. We emphasize now we struggle peacefully, because
the days of freedom and independence of the Montagnards are
gone. We are a broken people, but we still stand up with hope
and dignity.
I am a lucky person. On January 16, 1976, I was one of the
first prisoners to escape from jail into the jungle and joined
the Montagnard Resistance Force. We fought for freedom and
independence against Hanoi's violations, assimilation, and
extermination of our people.
After 11 years, we have refugee status in the United
States. I am the first member of the FULRO members to get my
family out of Vietnam. My family had to pay $2,000 to get their
exit visas.
It is only because of Senator Helms, and other Members of
the Congress and State Department, that my family was released
on January 14, 1994. Why are hundreds and hundreds of the
Montagnard waiting with hope? The United States is the only
hope to help their families out of Vietnam. Please help us and
get our families from Vietnam, and help our people still
remaining in Vietnam to have opportunity to develop and to
survive.
Jackson-Vanik should not waiver until all the Montagnard
cases are cleared. We need the Montagnard translators to
translate for the Montagnard for interviews in the future.
Thank you so much for the privilege to testify today. God
bless you.
[The prepared statement follows:]
Statement of Rong Nay, Member, Montagnard Human Rights Committee, Cary,
North Carolina
Ladies and Gentlemen:
My name is Rong Nay and I am a member of the Human Rights
Committee of the Montagnard People. I represent the Montagnard
people living both in the United States and in the Central
Highlands of Vietnam. I would like to thank Congressman Crane
for the opportunity to share our feelings about the plight of
the Montagnard people.
I want to thank the members of the Trade Subcommittee for
their interest and full consideration of the Jackson-Vanik
Amendment, free emigration and trade with Vietnam.
Today we are honored to have our voice heard. In Vietnam,
please understand that the Montagnard/DEGA indigenous people
have no voice to be heard. No true voice. We cannot get our
loved ones out of Vietnam. We cannot worship our Christian
faith freely. We cannot receive humanitarian aid. We cannot
have the same opportunities in education and development as
Vietnamese people.
Ambassador Peterson knows clearly about this, as does the
U.S. State Department.
So we are honored to have our voice heard here today. We
pray that the government of Hanoi will also hear our voice
today. We ask only to be treated as human beings. We love our
families and our children just the way Vietnamese people do.
Why can't we be reunited with our loved ones who still remain
in Vietnam and who cannot receive their exit visas? Why does
the Vietnamese government continue to punish our people because
we are an indigenous tribal people and because we fought and
died with Americans?
The intention of the Jackson-Vanik Amendment is to promote
free emigration, but in the last three months of the 121 names
presented by the Vietnamese government to U.S. officials, less
than ten have been cleared for interview. Lists of Montagnards
unable to receive exit visas have been given to Ambassador Le
Bang, to our Ambassador Peterson and to our State Department
months, even years ago. These same people cannot get their exit
visas even though the purpose of Jackson Vanik is to promote
free emigration from Vietnam. Our Montagnard people continue to
suffer separated from loved ones.
We are so sad that in Vietnam, we are forced to substitute
Vietnamese people into our family units just so that half of
our family can receive an exit visa to leave Vietnam. Please
believe us. This is a fact. We are eligible to emigrate,yet the
Vietnamese goverment forces our people to pay huge sums of
money to obtain an exit visa or we are told we must substitute
a relative of a police official so that their child can have an
opportunity to study in the U.S. This is against the law and
policy of the United States. Our tribal people have been
cheated and discriminated against for years in Vietnam, but now
we are being told we must bribe, cheat and split up our
families so that some of us will have a chance for freedom in
America.
Can you possibly understand how sad, how desperate we feel?
With respect to all members of Congress, Ambassador Peterson
and others here today, you live with your families. Hundreds
and hundreds of our Montagnard people have been living for
years and years without their wives or husbands, fathers and
mothers, sons and daughters because the Vietnamese government
is punishing our people.
Why do they punish us? Because we stood by the side of the
American government in the Vietnam War. We were recruited and
trained by the U.S. government. We were told the United States
would help the Montagnard highlander people in our struggle for
freedom and development. During the U.S. backing of South
Vietnam in the Vietnam War from 1962 to 1972, American Special
Forces recruited and trained thousands of Montagnard troops to
fight alongside Americans with loyalty, bravery and friendship.
Montagnards bonded to American soldiers as their only true
allies during the war. During the Vietnam War more than a
million Montagnard people were killed and 85 percent of
Montagnard villages were destroyed or abandoned.
Please do not turn your back on us now. We need your help.
We have no hatred towards Vietnam or Vietnamese people. We
respect Vietnam's great culture and her struggle for
sovereignty against China and other countries. Yet, we
Montagnards, too, want our people to survive and develop.
The Montagnards are the indigenous people of Malayo-
Polynesian heritage. We have been living for over 2,000 years
in the Central Highlands of Vietnam. We have over 40 tribal
groups with rich cultures and traditions of peace. Now is a
time of peace. Families should be together.
The Vietnamese government writes FULRO Anti-Revolutionary
on the paperwork of our people. This technique is a way of
stopping our relatives to emigrate to the U.S. FULRO was the
Montagnard Resistance Movement. It no longer exits. Although we
had support from the U.S. military in the past, we want to
emphasize we now struggle peacefully. The days of freedom and
independence are gone. We are a broken people, but we can still
stand up with hope and dignity.
I am a very lucky person. On January 16, 1976, I was one of
the first prisoners to escape into the jungle and join the
Montagnard Resistance Force. At this same time thousands of
people fled into the jungle. We fought for freedom and
independence against Hanoi's violations, assimilation and
extermination of Montagnard people. We finally realized it was
impossible for us to survive. After 11 years in 1986, we
received refugee status in the United States. I am one of the
few FULRO members who has been able to get my family out of
Vietnam. My wife and four children had their permission
withheld for five years. My wife had to pay the immigration
police $2,000 to get her exit visa. The Hanoi government
demanded that I return and face trial before considering exit
permission for my family.
It is only because of Senator Helms, other members of
Congress and the U.S. State Department that my family was
released on January 14, 1994. What of the hundreds and hundreds
of other Montagnards who are waiting with hope? The United
States government is their only hope to get their family
members out of Vietnam.
Since 1986, the Montagnard Community in the United States
found freedom and a new life. It is a great gift from America
just to be able to survive. We will give back to America our
lives as proud citizens of the U.S. The re-settlement of our
Montagnard people is known nationally to be a model of refugee
resettlement We don't use welfare. We are a quiet people. We
love our families and our Christian faith. The U.S. government
knows we are a family oriented, stable, non-violent, and self-
sufficient people.
Please help us to get our families out of Vietnam and help
our Montagnard people who remain there to have opportunities to
develop. The Jackson-Vanik waiver should not be renewed until:
l) All ROVR cases are cleared 2) All Montagnard cases, ODP and
HO cases are cleared 3) The same procedures used for ROVR
processing are used for Montagnards and HO cases. That is, we
need Montagnard translators from the U.S. to translate in the
interviews
Thank you so much for the privilege to testify today. I am
proud to be a citizen in this free and wonderful country.
Chairman Crane. And thank you and God bless you, Mr. Nay.
And our final witness is Ms. O'Shea.
STATEMENT OF LYNN M. O'SHEA, NEW YORK STATE DIRECTOR, NATIONAL
ALLIANCE OF FAMILIES FOR THE RETURN OF AMERICA'S MISSING
SERVICEMEN, BELLEVUE, WASHINGTON
Ms. O'Shea. Mr. Chairman, Mr. Jefferson, on behalf of the
membership of the National Alliance of Families, we want to
thank you for the opportunity to address this Subcommittee.
We're here today to express our total support of House
Joint Resolution 120 disapproving the extension of waiver
authority contained in section 402 of the Trade Act with
respect to Vietnam. The ancient Greeks said the first casualty
of war is truth. Today in the United States we can say the
first casualty of profit is morality. In the past, the United
States has been a leader in championing the cause of human
rights. We set the standard, and our standards were high. Now
in the name of trade, and in the name of profit, we continually
find ways to excuse or ignore human rights violations and
citizens' oppression.
A perfect example of this is China. We have opened trade
with China, and the Chinese people are still oppressed, there
are major human rights violations in China. We do not expect to
see any difference if we open trade or extend the waiver of
Jackson-Vanik to Vietnam.
Of course as you are aware, while we support the human
rights cause of our Vietnamese and Montagnard allies, our
concern is the human rights violation of American prisoners of
war missing in action and their families. Hanoi continues to
stonewall United States efforts to gain accurate information
relating to our prisoners and missing. Contrary to popular
belief, there is no no-notice access to sites. United States
investigators cannot go anywhere, anytime, and witnesses are
routinely interviewed by Vietnamese officials prior to their
meetings with United States investigators.
At the conclusion of the Vietnam war, the Vietnamese told
the U.S. Government that over 50 men had died in captivity. As
of today, the remains of some 25 of those men still remain in
Vietnam. These men died in camps in the south controlled by the
North Vietnamese and the Vietcong. Men like Rohrabacher,
Versace, Bennett and Cook to name but four. When do these men
get to come home? Where is the Vietnamese cooperation on men
they acknowledged they had control of? Circumstances of remains
recoveries are questionable today. And in at least one case, we
have very compelling evidence of site salting. Investigators
have told us that the reason so little remains come out of
Southeast Asia is because the soil is highly acidic and remains
simply do not last and we find bone chips and shards and teeth.
Yet one pilot who was buried supposed on the date of his
incident in September 1972 and remained unprotected in the
Vietnamese soil for some 24 years was recovered in a full
flight, wearable flight suit, perfect condition. This is
evidence of site salting and I would like to leave this
photograph with the Subcommittee for the record along with my
full testimony. Thank you.
The family in this case has an answer. They do not have the
truth, they do not know what happened to their loved one. At
the conclusion of the Senate Select Committee in 1973 the
Committee concluded that a small number of Americans were left
behind at the end of the Vietnam war. They could not name them.
The National Alliance of Families at this time with the
permission of the family who has been kind enough to make
available their documentation, along with documentation that we
have uncovered on independent research, we are prepared to
state firmly that Army Captain John T. McDonnell was alive in
the Bak To Prison Camp in Quang Ngai Province from August 1972
and his last sighting was mid to late February 1973. The source
of the report--and I will use his name because he spoke to the
Associated Press in June 1973 and gave his name and I take that
as a waiver of his desire for protection of anonymity--the
source was named Nguyen Thanh Son and he provided information
that six American POWs remained in that camp in Quang Ngai
Province and he had seen the six as late as mid to late
February 1973. He could provide no description on five of the
POWs who he described as NCOs. The sixth POW he described was
an army captain captured in the 1968-1969 timeframe. He was
married, he had two children, he was from the State of Texas
where President Johnson lived, that's a direct quote. He had
been an ARVN advisor, he gave instruction in artillery. He
provided a very detailed physical description down to a mole on
the lip of the POW and based on Joint Casualty Resolution
Center's analysis, they concluded that that sighting related to
one of two POWs: Either Captain John T. McDonnell or Army
Sergeant Glen Tubbs. Looking totally at the evidence and
factoring in a second or earlier sighting that JCRC also
correlated to Captain John McDonnell with an almost identical
physical description, we are prepared to state that John
McDonnell was alive in a camp in 1973, February 1973 when the
POWs were coming home. There is much more intelligence which is
detailed in my full testimony. I would like to close with
reading just one quote if I may because John T. McDonnell was
on the late eighties original 119 discrepancy list that General
Vessey presented to the Vietnamese. And this is a quote from a
letter that General Vessey wrote to then Congressman Bob Smith,
and he says, ``the discrepancy cases I presented to the
Vietnamese were those in which Americans were known to have
survived the incident in which they were involved. We believe
they came into Vietnamese hands and probably were prisoners of
the Vietnamese. These individuals did not return during
Operation Homecoming in 1973 nor were their bodies returned in
the intervening years and no explanation was provided by the
Vietnamese. Because these cases may shed light on the fate of
any American serviceman believed to have been alive after his
loss, they are our priority effort.''
In closing I would like to restate our firm opposition to
the waiver of Jackson-Vanik, and I would like to ask every
Congressman and every Senator when he considers his vote on
Jackson-Vanik to consider Captain John T. McDonnell and why the
Vietnamese have not provided information on his whereabouts.
Thank you.
[The prepared statement follows:]
Statement of Lynn M. O'Shea, New York State Director, National Alliance
of Families for the Return of America's Missing Servicemen, Bellevue,
Washington
Mr. Chairman, members of the committee, on behalf of the
membership of the National Alliance of Families, we thank you
for the opportunity to address this committee.
We are here today to express our total support for H.J.
Res. 120 ``Disapproving the extension of the waiver authority
contained in section 402 (c) of the Trade Act of 1974, with
respect to Vietnam.
The ancient Greeks said ``the first casualty of war, is
truth.'' Today, in the United States we can say ``the first
casualty of profit, is morality.''
In years past, the United States of America led the world
in championing the cause of human rights. We set the standard.
Our standards were high and other nations followed our example.
Now, in the name of trade, in the name of profit, we
continually find ways to excuse or ignore major human rights
violations and citizen oppression.
The conditions that existed in 1974 leading to the passage
of the Jackson-Vanick Amendment exist today, in Vietnam. The
only thing that has changed is our willingness to excuse and
look the other way. Today, our moral standards drift in the
winds of trade and profit. The bigger the profit, the lower our
standards go.
In some cases, by our actions, we even appear to condone
violations of human rights. The United States expanded trade
with China, yet their people remain oppressed. Human rights
violations are the norm in China, not the exception.
Now, this administration has requested a waiver to the
Jackson Vanick amendment to Title IV of the Trade Act of 1974,
as it applies to Vietnam. This waiver would provide for
taxpayer financed and/or guaranteed trade benefits for Vietnam.
The administration justified its decision to seek a wavier
to Jackson Vanick. by stating that trade will open doors and
bring new freedom to Vietnam. Opening trade with China did not
bring freedom to its people and it will not bring freedom to
the Vietnamese people.
Our organization supports the cause of human rights for our
Vietnamese allies wishing to escape communist oppression. The
original intent of the Jackson-Vanick Amendment to the Trade
Act of 1974, was to insure free emigration as a condition for
expanding U.S. trade relations with non-market communist
nations. Vietnam had not met the conditions required for a
waiver of the Jackson-Vanick Amendment.
As you well know, while we support the human rights cause
for freedom loving Vietnamese, our primary concern is the human
rights violations inflicted on American Prisoners of War,
Missing in Action and their families.
Hanoi continues to stonewall U.S. efforts to gain accurate
information relating to our Prisoners and Missing. Contrary to
popular belief, there is no ``no notice'' access to sites. U.S.
investigators can not go anywhere, anytime. Witnesses are
routinely interviewed by Vietnamese officials prior to their
meetings with U.S. investigators.
The Vietnamese provide movement but no real progress in the
search for our Prisoners and Missing.
According to the Vietnamese over 50 American prisoners died
in captivity, during the war. To this date the remains of less
than 30 of those POWs have been returned to their families.
These men died under the control of the North Vietnamese and
Viet Cong. They died in their POW camps. When do these men get
to come home. Where is the cooperation? Where is the
compassion?
Remains recoveries and identifications are questionable. We
now have evidence that, in at least one case, the recovery site
was salted. According to the Vietnamese, the pilot was found
dead in his parachute and buried.
Much is heard of the highly acidic Vietnamese soil which
leaves little in the way of remains. After 24 years in the
acidic Vietnamese soil little was left of this pilots' remains.
Yet, the flight suit in which this pilot was buried remained in
almost perfect and wearable condition.
The family questions this recovery, yet the Vietnamese
consider this case a success, as one more POW/MIA case is
resolved. The fated of this pilot may be resolved in the minds
of the Vietnamese and U.S. investigators, but no one has come
anywhere near the truth.
Although they could not name them, the Senate Select
Committee on POW/MIA Affairs concluded in 1993, that a small
number of American POWs were left behind at the end of the
Vietnam War.
Based on evidence available to us, we believe that one of
those POWs was Army Captain John T McDonnell. Capt. McDonnell
was sighted and conversed with the source on four occasions
between August 1972, and mid-to-late February 1973, at the Bak
To prison camp in Quang Ngai Province.
This sighting was taken very seriously by the United States
government. On June 15 th, 1973, the Defense Intelligence
Agency issued a message stating ``REFERENCED REPORT PROVIDED
INFORMATION OF URGENT POLITICAL SENSITIVITY.''
On April 10th, 1973, two days before Assistant Secretary of
State Dr. Roger Shields declared all the POWs home or dead, a
North Vietnamese soldier defected to the south. The defector,
who held the rank of ``aspirant and was commanding officer for
the 157 Co. 21st Bn, 2nd Div,'' provided stunning information
that six (6) American POWs remained in a POW camp in Quang Ngai
Province. He had seen the six (6) Americans as recently as late
February 1973.
The source, interviewed by U.S. investigators on May 22nd,
described the six (6), as an American ``Captain'' and 5 NCOs
The source never got a good look at the NCO's and could provide
no descriptions. However, the source did provide a detailed
description of the ``Captain.''
110900A Jun 73--From the Department of Defense National
Military Command Center:, ``In August 1972, Source entered an
MR-5 PW Camp.... Source contacted members of the 12th Artillery
Bn (NVA) who were at the PW Camp location to study the
operation of captured 105 MM Howitzers. Their instructor was a
captured American Artillery Officer... who was captured
(estimated 1968-1969) by the 459th Sapper Regt. in Binh Dinh
Province. The PW was forced to give artillery instructions
under threat of execution. In addition to the officer, there
were five (5) American NCOs referred to as sergeants and 200
ARVN PWs.... The Americans were segregated from the ARVN PWs.
Source only caught a glimpse of the five NCOs and thus could
provide no information concerning them. Source, however,
conversed with the Artillery Captain on four different
occasions, from August 1972 until late February 1973.''
``Source stated the American officer was approximately 75
inches tall, with blue eyes and blond hair. He had a high
bridged nose and was thin but had a large frame. The artillery
Captain had a small mole on the upper portion of his left lip
and a scar approximately 1 1/2 inches long behind his left ear.
Subject had two tattoos-one on his right forearm... the other
on his upper left arm.... The American was married and had one
girl 11 and one boy aged 5. Source states that on the four
occasions he conversed with this Captain, a Sr. LT. Hinh, MR-5
interpreter, assisted him. Source states the Captain was from
Texas, the same place where President Johnson lived, and from
source's imitation of the sound of his name it may be inferred
that the officer's first name was John (sic)....''
According to the source the POW ``was forced to give
artillery instruction under threat of execution.'' We would
assume that the 5 American NCOs in camp with the ``Captain''
faced the same threat of execution, if the ``Captain'' failed
to cooperate.
June 13th, 1973--the Defense Intelligence Agency (DIA)
narrowed down the identity of the Captain to one of two men.
They were Captain John T. McDonnell and Sgt. Glenn E. Tubbs,
both of the United States Army.
June 15th, 1973--the DIA issued their message regarding
``INFORMATION OF URGENT POLITICAL SENSITIVITY.'' After
declaring all the POW's home or dead, the Department of Defense
faced a unique crisis. A first hand eyewitness provided a
detailed description of an American POW alive in Quang Ngai
Province in February 1973, and he was not alone.
In DIAs words, ``Analysis of the descriptive data of the
``American Captain'' has produced two candidates. Although
neither fits the description perfectly, both have enough of the
reported characteristics that their photographs should be shown
to the source. The two individuals are DATA (McDonnell J.T.
Cpt, USA) and DATA (Tubbs, G.E. E5, USA)... Both families are
being interviewed to determine what tattoos and scars the
individuals may have had. Sgt. Tubbs is known to have had one
tattoo on each arm. It is not known whether Cpt. McDonnell had
tattoos. The scar behind the left ear fits Cpt. McDonnell. It
is not known if Sgt. Tubbs had a similar scar.''
Capt. McDonnell and Lt. Ronald Greenfield were pilots
aboard a AH-1G helicopter. On March 6, 1969 their chopper was
hit by ground fire and crashed 50 kilometers southeast of Hue
and 3 kilometers southeast of Thon Thuy Cam, Thua Thien
Province.
U. S. search teams operated in the area from 1600 hours (4
P.M.) March 6th to March 12th. They found no sign of Capt.
McDonnell. On March 7th, at approximately 1330 hours (1:30
P.M.) American search teams located Lt. Greenfield, near the
downed helicopter. Lt. Greenfield was seriously wounded and had
no memory of events after the crash. He was unconscious from
the time of the crash until about 3-5 hours later. Greenfield
believes that Capt. McDonnell removed him from the downed
helicopter. Examination of the downed helicopter revealed that
Capt. McDonnell's seat belt and harness were open and placed
neatly on the seat. Search teams located McDonnell's helmet.
There was no sign of blood in the helmet. Also located at the
crash site were maps, weapons, and survival equipment.
According the ``JTF-FA Narrative'' presented to the Vietnamese
in 1989, this suggests ``he either had to quickly flee the area
or was captured.''
Sgt. Glenn Tubbs was a rifle man on a Long Range
Reconnaissance patrol. During a river crossing, Sgt. Tubbs lost
his grip on the safety line. The current was strong and he was
swept away. Search efforts were complicated when helicopters
received enemy fire. Early records list Sgt. Tubbs loss
location as South Vietnam. However, we have located a document,
from Army files dated 17 March 1970, which lists Glenn Tubbs as
missing in a classified area of Southeast Asia. Glenn Tubbs was
lost in Cambodia, not South Vietnam as the early records
indicated.
We have been unable to locate the Tubbs family, however,
the case narrative and witness statements, available at the
Library of Congress, describe Sgt. Tubbs incident as almost
non-survivable.
Both men are from Texas and married. Capt. McDonnell has
three children. Sgt. Tubbs has two. The physical description
fits Capt. McDonnell, with one possible discrepancy. There is
no record of Capt. McDonnell having tattoos, while it is known
that Sgt. Tubbs had two, one on each arm.
Documentation obtained by the National Alliance of Families
proves that the sources description of the tattoos does not
match Glenn Tubbs. Official documentation also indicates that
many servicemen acquired tattoos while in service, and
therefore official records may not be accurate in this matter.
Capt. McDonnell has a scar behind the left ear. Records
available to the National Alliance of Families indicate Sgt.
Tubbs had no such scar.
In addition to the physical description, the first name,
the time frame of capture, rank of the PW, the fact that the PW
was an ARVN advisor and artillery officer all match Capt.
McDonnell. It should be noted that Capt. McDonnell was on his
third tour of duty. His first two tours were served with the
Green Berets as an ARVN advisor.
In reviewing this material, one must remember that all four
conversations were conducted through an interpreter. Minor
errors of translation may have occurred regarding the number of
children. It should also be remembered that the number of
children is a minor detail which the source may have been
confused. It is critical to remember that all major facts
relating to the American ``Captain'' correlate to John
McDonnell.
This was not the first sighting of Capt. McDonnell in
captivity. This first sighting provides a physical description
almost identical to the description of the ``Captain'' in the
Quang Ngai POW camp.
February 16th, 1973--another North Vietnamese rallied to
the GVN. This source was a former NVA sergeant. He served as
squad leader with the 5th Company, 14th Antiaircraft Battalion
NVA 2nd Yellow Star Division. Generated by the Central
Intelligence Agency, this report provides a firsthand
observation of two U.S. Prisoners of War with the North
Vietnamese Army 2nd Yellow Star Division in Laos, on three
different occasions, between May and July of 1971.
The first sighting took place ``in early May or June 1971
when he saw the two POWs eating lunch with personnel of the
Military Staff and political offices, North Vietnamese Army
(NVA) 2nd Yellow Star Division [word unreadable] Doan 2 Sao
Vang, at the 13th Commo-Liaison Station (WD876558), 33rd Binh
Tram, NVA 559th infiltration line (Doung Day 559) in
Savannakhet Province Laos. He observed them for about 30
minutes.''
``The second time source saw the same POWs was for about
two minutes in July, 1971.''
``The third time he saw the POWs was for about ten minutes
in July, 1971, while POWs were sitting in a hut in the
division's base camp area.''
The source was told that the POWs ``had been captured by
the NVA 2nd Division in Quang Nam Province, South Vietnam.
Source observed the POWs the first time from at a distance
of about two meters. Both were Caucasian, one was about 30
years old, about 1.8 meters tall, and weighted about 90 kilos.
He had a heavy build, a pink complexion, a long face, short
brownish blond hair, a receding hairline, a high straight nose,
brown eyes, white regular teeth, a round mouth, and a red mole
under his lower left lip. He was wearing a green NVA uniform
consisting of a short-sleeved shirt and trousers. He was also
wearing a white metal ``seiko'' wrist watch and a large gold
ring with a red ruby on his left hand.''
``In about October 1972, servent (sic) NAME, a radio
operator in the NVA 2nd Division, told Source that the two POWs
had been sent to North Vietnam.
In the words of Joint Casualty Resolution Center (JCRC)
``no correlation could be made on the second POW cited in the
report.'')
With regard to the first POW, JCRC stated in the ``Field
Comment''--``Records indicate that source probably observed
Capt. John T. McDonnell, USA (JCRC Nr. 0176).... There is an
indication that McDonnell may have been captured....
McDonnell's description follows: age in 1971 was 31, height:
1.77 meters; weight 75 kilos' hair; brown; race; Caucasian;
wears white silver seiko watch and large ring on left hand.'' A
photo of Captain McDonnell wearing such a ring was provided to
the National Alliance of Families by the McDonnell family.
JCRC re-contacted the source. He was shown McDonnell's
photo ``mixed with 15 other photographs. However source was
unable to make an identification. Then he was shown McDonnell's
photographs. After five minutes of study, source said that the
photograph looked very similar to the POW who wore the ring,
except that his hair was longer and that his nose was long and
nostrils were less pronounced. He said that the shape of the
face, the eyes, and the mouth were similar to the man in the
photograph, but stopped short of making a definite
identification because of the difference in the hair style and
nose.''
April 23, 1976--The next record, available to us, comes in
a report compiled by the Joint Casualty Resolution Center. The
report is titled ``Project X.'' ``Project X'' was a study to
``evaluate the possibility of any of the unaccounted for being
alive. The conclusion reached is: There is a possibility that
as many as 57 Americans could be alive....''
Among the 57 Servicemen mentioned in ``Project X'' is Capt.
John T. McDonnell. The Case Summary on Capt. McDonnell cites
the 1971 sighting stating, ``information in this report
correlated to Cpt. McDonnell.'' There is no mention of the 1972
-1973 sightings in Quang Ngai.''
In the late 1980's the name of John McDonnell was placed on
the ``Original 119'' Vessey Discrepancy List.
What was the significance of being on the ``Original 119''
Vessey Discrepancy List.? In a November 15th, 1989 letter to
then Congressman Bob Smith, General John W. Vessey Jr. writes
``The discrepancy cases I presented to the Vietnamese were
those in which Americans were known to have survived the
incident in which they were involved. We believed they came
into Vietnamese hands and probably were prisoners of the
Vietnamese. These individuals did not return during Operation
Homecoming in 1973, nor were their bodies returned in the
intervening years and no explanation was provided by the
Vietnamese. Because these cases may shed light on the fate of
an American serviceman believed to have been alive after his
loss, they are the priority of our efforts.''
On April 25th 1991, Kenneth Quinn, then Chairman of the
Administration's POW/MIA Inter-Agency Group testified before
the Senate Foreign Relations Subcommittee on Asian and Pacific
Affairs. In response to a question from Senator Alan Cranston,
Mr. Quinn stated ``In terms of actually conducting
investigations on the ground, General Vessey has focused on 119
discrepancy cases, which is to say those cases, which
represent, from looking at all the information we know about
them, represent the greatest possibility that the men involved
might still be alive. We had evidence that they were alive
after the incident occurred where the plane was shot down or
they were lost on the ground and we don't know what happened to
them and what their fate was.''
``So those represented to General Vessey the possibility
where it is most probable or most likely that they might still
be alive.''
Statements by General Vessey and Mr. Quinn re-enforce our
position that Capt. McDonnell, listed as an ``Original 119''
Vessey Discrepancy Case, was alive in February 1973.
The United States Government possessed strong evidence
placing John McDonnell in captivity. That evidence shows John
McDonnell alive in February 1973.
1992--Joint Task Force--Full Accounting (JTF-FA) all but
ignored the two sightings in case narratives, on John
McDonnell, presented to the Vietnamese. Of the three JTF-FA
Narratives available to us, dated, August 1989, July 1990, and
Jun 1993, only the July 1990 Narrative mentions the 1972-1973
sighting. None mentions the 1971 sightings, in which JCRC
concluded ``that source probably observed Capt. John T.
McDonnell.''
JTF-FA ignored the strong evidence of John McDonnell's
capture. They ignored evidence of his imprisonment and survival
along with five (5) enlisted men.
Instead, in 1992 JTF-FA chose to interview witnesses
supplied by the Vietnamese. All claimed to have witnessed the
helicopter crash. None, however, saw Captain McDonnell. None
witnessed his capture. None witnessed his death or participated
in his supposed burial on March 7, 1969.
September 30, 1992--In their field activity report JTF-FA
said, of the Vietnamese witnesses, ``Although none of the
witnesses actually took part in the capture and burial of the
American, they all provided hearsay information that he died
while being escorted probably to the Tri Thien Hue Military
region Headquarters...''
Captain McDonnell's identification card was located in the
Hue City Museum. The card, according to records arrived at the
museum in 1975. Field Investigators excavated Captain
McDonnell's alleged grave site. The excavation yielded no human
remains.
Based on the hearsay of 4 Vietnamese, the 1993 Narrative
incorporated the ``corroborating hearsay testimony concerning
the crash of a U.S. helicopter in 1969 and the subsequent
capture and burial of an American.''
In other words, since the Vietnamese witnesses all told the
same story, it was true.
Today, the case of John McDonnell is considered fate
determined. This determination is based on 4 hearsay accounts
of Vietnamese witnesses who claimed they heard about a captured
American, who died the next day. JTF-FA routinely ignores
hearsay information about live POWs. Yet, in this case they are
willing to believe hearsay information regarding the death of a
POW. A POW, who by their own records and correlation's, was
alive in February 1973.
One must wonder, if these same four Vietnamese provided
information that Capt. McDonnell was in the Quang Ngai POW Camp
at Bak To, would JTF-FA investigators be so willing to believe
them.
We, at the National Alliance of Families, believe that
based on the information cited, there can be only one
conclusion. Capt. John McDonnell was alive as a Prisoner of War
at least until February 1973. We further believe that Capt.
John McDonnell survived in captivity, as the Nixon
Administration was declaring him, and the 5 NCOs with him,
dead.
We believe that this case is ample evidence that the
Vietnamese government is not ``cooperating in full faith'' on
the POW issue. How many other cases, like this, are ignored?
The Vietnamese Government must be held responsible for the
fate of John McDonnell and the 5 NCOs with him.
Long discussed within the POW/MIA issue was information
regarding a press conference held in Saigon in June, 1973.
During this press conference, a defector provided information
regarding POWs not released. Until now little was known about
what went on during that press conference as the story was
``spiked'' at the request of the American Embassy.
That defector was Nguyen Thanh Son, source of the sighting
of the American ``Captain'' and 5 NCOs in Quang Ngai Province
between August 1972 and February 1973. During the Saigon
interview, in June of 1973, attended by members of the media
representing Associated Press, United Press International and
NBC, Son spoke of POWs. To our knowledge there is only one
record of that interview. It is a short Associated Press
Article from the Baltimore Sun, dated June 9th, 1973. In that
article, Nguyen Thanh Son is represented as a ``junior North
Vietnamese officer'' not the ``commanding officer for the 157
Co. 21st Bn, 2nd Div,'' as described in the DIA message.
Mr. Son spoke of North Vietnamese plans to infiltrate the
South and discussed a North Vietnamese ``plan not to launch a
general offensive until 1976--before the U.S. presidential
elections.'' ``Right now, they don't want to launch an
offensive. They're afraid of the reaction of world opinion as
well as President Nixon,'' he said.
Perhaps the Nixon resignation in August of 1974, allowed
the North Vietnamese to move up their time table.
On the subject of POWs Mr. Son, according to the AP
article, stated ``he also believes the North Vietnamese are
still holding some American prisoners in effect as hostages to
insure that all mines are removed from North Vietnamese waters
and that Hanoi receives United States reconstruction money.
They want to keep U.S. prisoners because there are many
problems to be settled with the U.S. government. They want to
keep prisoners in case the U.S. government launches war again,
they will have some prisoners.''
The article went on to say that ``Mr. Son refused to
elaborate further,'' on the subject of POWs.
If Mr. Son did not have information deemed credible, why
did the Defense Intelligence Agency, on June 15th, 1973 issue
there message of ``URGENT POLITICAL SENSITIVITY.'' Why did the
Embassy in Saigon go to extreme lengths to have the story
killed? The bigger question is why did the media in the person
of UPI and NBC agreed and killed the story.
A telegram dated June 11th, 1973, from the American Embassy
Saigon to the Secretary of State Washington D.C., states ``NVA
rallier/defector Nguyen Thanh Son was surfaced by GVN to Press
June 8 in Saigon. In follow on (sic) interview with AP, UPI and
NBC American correspondents, questions elicited information
that he had seen six prisoners whom he believed were Americans
who had not yet been released. American officer present at
interview requested news services to play down details; AP
mention was consistent with embargo request, while UPI and NBC
after talk with Embassy Press Officer omitted item entirely
from their stories.
Details on rallier's account being reported septel (sic)
through military channels by Bright Light Message today, [word
missing] White House.''
Nowhere in the Associated Press article is the number of
POWs mentioned. Nor is it mentioned that Mr. Son actually saw
the POWs over an extended period of time. Or that he spoke with
one of them on 4 different occasions. Instead a carefully
crafted sentence states ``he also believes the North Vietnamese
are still holding some American prisoners...''
All the evidence indicates John McDonnell and 5 NCO's were
alive in a Quang Ngai POW camp, in mid-to late February 1973.
How much longer must they wait to come home?
The Vietnamese government knows what happened to John
McDonnell and when it happened. Only his family and the
American public remain in the dark.
The National Alliance of Families challenges the Clinton
Administration, to live up to its commitment of a full and
truthful accounting. A good place to begin is with the case of
John McDonnell and the 5 NCOs in the Quang Ngai Prison POW
Camp, in February of 1973.
We challenge every Senator and Congressman to stand up and
ask the Vietnamese where is John McDonnell? The evidence
outlined above is overwhelming.
John T. McDonnell is but one of the 2,000 plus reasons The
National Alliance of Families adamantly opposes a waiver of the
Jackson-Vanick amendment to Title IV of the Trade Act of 1974,
as it applies to Vietnam. Waiving the Jackson Vanick Amendment
will allow the Vietnamese government to continue with business
as usual. They will fill their treasury by charging outrageous
fees to American corporations doing business in Vietnam, while
their citizens work in substandard conditions for substandard
wages..
Additional trade concessions will not improve the quality
for life or the average Vietnamese citizen. Additional trade
concessions will not improve Vietnamese cooperation on the POW/
MIA issue.
Waiving the Jackson-Vanick amendment as it applies to
Vietnam is about profit, not about benefits to the Vietnamese
people or advancing the cause of our POW/MIAs. It is about the
difference between a CEO's 60 million dollar bonus or his 50
million dollar bonus.
The question is, will this congress allow that check to be
written on the backs of our POW/MIAs and the oppressed
population of Vietnam?
Chairman Crane. Thank you, Ms. O'Shea.
Mr. Jefferson.
Mr. Jefferson. I wish to thank our Chairman and thank each
of you for your very sincere testimony today. This is a very
difficult area and when you have people who have had personal
experiences reporting here it makes it very hard for us to pass
judgment on it without really taking a moment to give great
credence to what you have had to say. I want to ask, in the
cases where people have been denied the permission to emigrate,
what reasons does the government offer for that? What do they
say to people as to why they do not want them to leave the
country?
Mr. Thang. I would like to answer your question if I may,
Mr. Jefferson. Usually the Vietnamese Government doesn't give
any reason whatsoever. For the small number of cases that we
have documented, we know the reasons. For instance, if an
applicant cannot afford to pay an exorbitant amount of money to
an official, for instance, that person would not make it to the
list. Often one can confirm at least on a number of cases that
have been denied permission, and the reason was that these
individuals are longer interested in the programs. However,
through the relatives in the United States, also direct mail
from them, I'm very sure, I'm very certain, that they are still
very much interested just because they didn't get the money to
pay and therefore they----
Mr. Jefferson. Do you contend that every immigrant in
Vietnam pays this exorbitant sum of money which you have
described?
Mr. Thang. Well, actually I would like to suggest this.
It's very easy and simple to verify. The Subcommittee only
needs to request a study by the General Accounting Office here,
and all they need to do is to conduct a number of interviews of
newly arrived immigrants and refugees, say over the past 3
months. And we can have a very clear and concrete benchmark to
judge whether Vietnam has improved its record on emigration or
not.
Mr. Jefferson. So it is your contention that there has been
no improvement in the emigration record of Vietnam, and you can
prove that nothing suggests improvement in that conduct.
Mr. Thang. Not only that, sir. There has been some motion
but there has been a significant slowing down so I don't
consider that as improvement. Actually it has gone backward. I
would like to add one, one point here with regard to one
specific case. It relates to MIA-POW issue. I had been trying
to get one Vietnamese woman out of Vietnam. She escaped to
Malaysia many years ago and provided valuable information to
the American team, I think it's the Joint Task Force, just
interviewed and her information did bring about a resolution of
at least one case. Her whole family was allowed to leave
Vietnam, however she was not because she had contacted
foreigners without permission. It would be of great help if
Senator Kerry could exert his influence on the Vietnamese
Government to get this poor woman access to interview. I think
that she would appreciate that and all the other people here in
this room would appreciate that as well.
Mr. Jefferson. I was looking at the declaration, I'm sorry,
at the extensive waiver authority for Vietnam, message from the
President transmitting it to the Congress notifying the
Congress of the President's determination to extend the waiver.
The waiver is fairly new since March 9, and so the statement
here is that there hasn't been enough time to judge whether
there's been any material change in the immigration policy. But
it notes that some 480,000 Vietnamese entered the United States
in the last 10 to 15 years, I expect to note that people who
have wanted to leave is far higher. It talks about progress
made of the resettlement opportunities for Vietnamese returning
program. And it states in those years as to how many people
have benefited from that effort.
Have you had a chance to see this--the notice transmitted
by the President to the Congress?
Mr. Thang. Not yet sir, however I got the latest figures
yesterday and again----
Mr. Jefferson. Has anyone seen this document and is it
their contention that these findings are in error or overstated
or can you suggest that they are correct?
Mr. Thang. I think that it has a misstatement in there,
sir. Actually, not misstatement but mispresentation of the
facts and figures. Even Senator Kerry did mention that Vietnam,
actually I'm sorry, Mr. Peterson, did mention and did
acknowledge that Vietnam had cleared about 40,000 cases,
individuals for interview under the ROVR Program during a very
brief period of about 3 months. So Vietnam had the full
capability to clear the rest but it's only about 3,000 names
within a month but it has been 3 months already and there's no
reason why Vietnam cannot do it just overnight.
Mr. Jefferson. The efforts that are being made--thank you
very much, sir--Mrs. O'Shea, the efforts that are being made to
identify remains and satisfy families in their enquiries about
missing, missings-in-action if you will, or people who have
not--the cases that we talk about now, are they cases where we
don't know what happened at all to individuals, and the most
cases we'll know that they were casualties of military action
but we haven't been able to have the remains returned? Which
cases do you find yourself working with now more of, now?
Ms. O'Shea. The cases--we realize that we are not going to
get a full accounting of every man. We do not expect that, it
was a war and that's not going to happen. But in very many
cases we have extensive information that contradicts the
resolutions that are being presented to the families. In other
words, in this particular case of Navy pilot Daniel Borah, his
family was told in the family report that his body--he had
ejected from his aircraft, did not survive the ejection and his
body was found in his parachute in a tree, he was found dead by
the Vietnamese. They took the body down and they buried him and
there he rested until the excavation in 1996. National Security
Agency documents tracked the shootdown and within 10 minutes of
Dan Borah's shootdown we have a document that states he had
been captured alive. The overhead aircraft reported short
bursts of manual beeper transmission and we have one document
that was presented to the Vietnamese in 1973 as part of the
four-party Joint Commission which was then designed to resolve
all these cases, which states that Dan actually gave a voice
transmission from the ground and the transmission was ``Gomer
drawn all around.''
Mr. Jefferson. May I ask you, how many cases are there like
this----
Ms. O'Shea. There are a lot more than people realize. I
could not give you an actual estimate. I can tell you the Borah
case is one; I can tell you the McDonnell case is one. There's
a case of four men who were in ambush also in Quang Ngai
Province. There is CIA documentation that they were captured.
They were being held--plans were being made to move them to a
western area and the most recent report I got from the family
is they're scheduling field excavation at the exact loss site.
So if the CIA Intelligence was correct, an excavation at the
loss site will tell us one of two things: There's nobody there
or the site was salted. Assuming the CIA reports are correct
and the subsequent reports of sightings, there are many cases
where there is strong information and the reports coming back
to the--we have movement but we don't have real progress and
the families don't have real truth. To be told that your loved
one is dead and to have a good remains identification is one
thing, but most of these families still do not know what
happened and those answers lie in Hanoi and some of these men
who were in a POW camp, some of them were probably executed
very shortly after captivity. But the families that I talked to
and that I work with, they want to know this. They want to know
if they died immediately, if they were executed, if they lived
in a camp for 4 years, if for some reason the Vietnamese held
them until 1975 and then decided to execute them. They--all
they want is the truth.
Mr. Jefferson. I recognize that and I cannot imagine how
tortuous it must be for a family. I have no way to imagine
that. And so I think that our government must continue to work
in the area, as vigorously as it can and put as much effort
into it and as much modern technology and much whatever else we
can to help to resolve these things and these very sensitive
areas for families. And we should continue to have a commitment
to that as far forward as it takes to satisfy every possible
interest of any family member out there. I mean that's how I
feel about it.
The question before us and that we have to deal with is
whether we cannot continue to press forward and make progress
in that area and not only on the issues that you talked about
with trade and investment, continue to allow Americans to find
opportunities in Vietnam and in Vietnam's surroundings. And at
the same time without losing priority on this, press for human
rights issues and press for openness on, why can't we--is there
some reason why we cannot press for all these things at the
same time? And make them all priorities----
Ms. O'Shea. At this point I believe there is a reason. We
have lifted the trade embargo with Vietnam, we have normalized.
This has all happened within a very short period of time and I
have to differ with the witnesses who spoke earlier saying that
that generated a tremendous amount of progress and resolution
of cases. It resulted in movement, it did not result in
progress. We still do not have answers. U.S. investigators are
going to the same sites four and five times because the
Vietnamese are doling out witnesses one at a time. I think we
need to stand back. We have rewarded nonprogress twice or
limited progress twice. I think instead of us making the
overture and saying, give us more we're going to give you
Jackson-Vanik, we should say if you want the Jackson-Vanik
waiver but we're going to sit on it 6 months or a year, you
give us and then we'll sit down and talk. We're giving before
we're getting and we did that with the trade embargo and we did
that with the normalization, and I think Jackson-Vanik is our
last lever and I think we should use that. We are in the
stronger negotiation position and I think we should negotiate
using that strength and it should be held off and the
Vietnamese, we should go to them and give them the opportunity
to show us, not for us to show our good faith continually in
giving to them in hope that we get answers.
Chairman Crane. Well, I want to express appreciation to all
of you witnesses and please stay in touch and keep
communicating with the Subcommittee because we certainly want
to address the questions and the concerns that you've raised
and I confess that my two kid brothers were over there during
the Vietnam war in the late sixties and I had the opportunity
to get over there three times in 1970, 1972 and 1974 and I was
overwhelmed when we got the news back here that our last
survivors were climbing up on helicopters to get out of there.
It's one of those vivid experiences and it has to be profoundly
vivid to all of you folks that were there. So please
communicate and thank you for coming and testifying today.
Ms. O'Shea. Thank you.
Chairman Crane. And our next panel I would now like to call
Thomas O'Dore, chairman of the American Chamber of Commerce in
Vietnam-Hanoi Chapter; Virginia Foote, president of the U.S.-
Vietnam Trade Council; Greig Craft, vice chairman, Asia Pacific
Council of American Chambers; and Bradley Lalonde, vice
president and country corporate officer for Vietnam with
Citibank.
And I would like to remind you to try and keep your oral
presentations to 5 minutes and any written presentations will
be made a part of the permanent record. And we shall proceed in
the order I presented you.
Mr. O'Dore, you're first.
STATEMENT OF THOMAS O'DORE, CHAIRMAN, AMERICAN CHAMBER OF
COMMERCE IN VIETNAM, HANOI CHAPTER; AND CHIEF REPRESENTATIVE,
CIGNA INTERNATIONAL
Mr. O'Dore. Thank you, Mr. Chairman and honorable
Subcommittee Members. My name is Thomas O'Dore, chairman of the
American Chamber of Commerce in Vietnam, Hanoi Chapter. I'm
also chief representative for a U.S. multinational insurance
company, CIGNA International. And I'm also an American citizen
living in Hanoi, married to a Vietnamese national and I have a
rather large extended Vietnamese family.
Amcham-Vietnam has nearly 600 members comprised of Fortune
500 companies, nongovernmental organizations including
veterans' groups, and entrepreneurs including many Vietnamese-
Americans. Americans have invested roughly $1.3 billion in
Vietnam following the lifting of the embargo, bringing America
quickly into the top 10 list of Vietnam's largest investors.
This is significant as American companies got a late start due
to the delay in lifting the embargo and has been successful
without U.S. financing programs and development aid, which our
foreign competitors have had for years.
Now that we have Ex-Im, OPIC, TDA, afforded to us by the
President's waiver under the Jackson-Vanik amendment to the
Trade Act of 1974, we now have a level playingfield with other
investor countries operating in Vietnam. Amcham-Vietnam
applauds the President's renewal of Vietnam's waiver under the
Jackson-Vanik amendment, and we urge Congress to accept the
President's warranted decision.
Today progress is being made by our U.S. Trade
Representatives to negotiate a comprehensive bilateral trade
agreement which will enhance market access for U.S-made goods
and services and strengthen protection of all intellectual
property rights. We further urge Congress to give the bilateral
trade agreement early consideration and ratification once it is
signed by extending normal trading status to Vietnam.
Vietnam has the second largest population in Southeast Asia
and I believe the 12th largest in the world with about 78
million people. It has huge potential as a market for U.S-
produced goods, services and technology. Vietnam remains
engaged and open to United States companies, more United States
jobs will be added to the existing three million American jobs
which already support the $245 billion in exports from the
United States to Asia. But the negative effect of the Asian
financial crisis on U.S. exports and jobs which we estimate
will be down about $30 billion this year alone, we need to open
more markets, not close the door further.
We will not hide the fact that our nearly 600 members find
Vietnam a difficult market to enter. But I point out that our
membership is increasing, most of us are doing business in
Vietnam and we have success stories to tell. Most importantly
we all have a positive long-term view on Vietnam's potential
and position in ASEAN.
We also want Americans to know that our member companies
are very much aware of the POW-MIA human rights, immigration
and religious freedoms issues present in Vietnam. Of the large
American communities living and working in Vietnam, we
participate and engage the Vietnamese in these issues in our
daily lives. Our Amcham board of governors includes veteran
groups and humanitarian and nongovernmental organization
members, and they have a visible and active Committees in our
organization. Americans must engage Vietnam to nurture and
develop our ideals of democracy, religious freedom and basic
human and labor rights.
Lifting the embargo has already started the process of
change in Vietnam. Waiving the Jackson-Vanik amendment has
taken another step forward. In just a few short years English
has replaced Russian and French as the second language of the
Vietnamese. The National Economics University in Hanoi has
established its first internationally recognized MBA program.
Satellite TV stations like CNN, ESPN, MTV, and international
publications like ``The Wall Street Journal,'' ``USA Today''
and of course the Internet, are widely available to the
Vietnamese population. The government is decentralizing
investment decisionmaking and a stock market is in the works.
Vietnam's decisionmaking body, the National Assembly, has more
women representatives on a percentage basis than our own
Congress. Large state-owned enterprises are being equitized and
are insisting on American technology in their infrastructure
projects with foreign companies. MIAs are coming home, and the
hundreds of Catholic churches are overflowing on Sunday.
Unilateral penalties and sanctions against the Vietnamese
Government inhibiting American individuals, organizations, and
business in Vietnam will have the opposite effect in achieving
their well-intentioned goals. In fact, it will give our
competitors an upper hand in Vietnam and they will not
participate in a one-sided policy toward Vietnam, stepping into
the space we vacate.
As we have witnessed in Indonesia, only by educating the
people and engagement can we make change in Vietnam's
government happen. The Asian financial crisis has handed
America the unique opportunity to step in and take the lead in
shaping the future of Vietnam and Asian countries in general.
In speaking to you as chief representative of CIGNA, the
insurance market was a monopoly owned by the state-owned
insurance company, Bao Viet. Since lifting the embargo, Vietnam
unilaterally saw the need to create a competitive insurance
market to attract foreign investment. To date, there is over
$30 billion in new foreign investment, six new insurance and
reinsurance companies in just the past 3 years. There are over
30 insurance company representative offices, including four
American companies: Aetna, AIG, CIGNA and John Hancock.
While the opening of the market is too slow from my
perspective, it is a positive step in the right direction.
Further, it is likely that the first 100 percent foreign-owned
licensed insurance company will be an American insurance
company, but only if the U.S. Government continues to
positively engage Vietnam.
A joint resolution to negate the renewal of the President's
waiver under Jackson-Vanik amendment will give our competitor
countries a stronger position in Vietnam and further weaken our
progress.
And on one final personal note, my wife is Vietnamese. We
were married in Vietnam last year. My wife's ability to freely
travel to other countries is only limited by the countries she
wants to visit. She's currently on vacation in Europe because
the United States would not give her an entry visa to be with
me here today. Vietnam no longer requires its citizens to
obtain exit visas in their passports. They're free to leave and
return as they please as long as they have a passport. She is
free to leave and return to Vietnam any time she wants just as
I can leave and return to the United States, not because she's
married to me but because the Vietnamese Government passed laws
allowing all Vietnamese passport holders to do just that.
In summary, engagement is working, albeit slower than some
of us expect. Progress is happening in areas of investment,
human and labor rights, repatriation of MIAs, emigration, and
religious freedoms. If you take away the Jackson-Vanik
amendment, you take away the light at the end of the tunnel for
Vietnam. You'll take away the incentive to negotiate a
comprehensive trade agreement and all incentive for economic
and social reform. Thank you, Mr. Chairman.
[The prepared statement follows:]
Statement of Thomas O'Dore, Chairman, American Chamber of Commerce in
Vietnam, Hanoi Chapter; and Chief Representative, CIGNA International
Dear Mr. Chairman and Honorable Committee Members.
Today, I come before you first, as Chairman of the American
Chamber of Commerce-Hanoi Chapter, second as Chief
Representative for US multinational insurance company CIGNA
International, and lastly, as an American Citizen living in
Hanoi. Under all three scenarios, I will show that support for
the President's renewal of the waiver under the Jackson-Vanik
amendment is the right position to take.
Amcham Vietnam has nearly 600 members, comprised of Fortune
500 companies, non-governmental organizations (NGOs), including
veterans groups, and entrepreneurs, including many Vietnamese-
Americans.
Americans have invested roughly $1.3 billion in Vietnam
following the lifting of the embargo, bringing America quickly
into the Top Ten list of Vietnam's largest investors, behind
primarily Asian countries, such as Singapore, Japan, Korea and
Taiwan. This is significant, as American companies got a late
start due to the delay in lifting the embargo and have been
successful without US financing programs and development aid,
which our foreign competitors have had for years. Now that we
have EXIM, OPIC and TDA, afforded to us by the President's
waiver under the Jackson-Vanik amendment to the Trade Act of
1974, our option of becoming Vietnam's #1 investor is
excellent. We now have a ``level playing field'' with other
investor countries operating in Vietnam.
Amcham-Vietnam applauds the President's renewal of
Vietnam's waiver under the Jackson-Vanik amendment and we urge
Congress to accept the President's warranted decision.
To date, progress is being made by our US Trade
Representatives to negotiate a comprehensive bilateral trade
agreement, which will enhance market access for US made goods
and services, and strengthen protection of intellectual
property rights. We further urge Congress to give the bilateral
trade agreement early consideration in ratification, once it is
signed, by extending non-discriminatory treatment (i.e., normal
trading status, or MFN if you prefer), as well a tariff
preferences pursuant to the ``generalized system of
preferences'' to Vietnam.
Why to we ask for these considerations, you wonder?
First, Vietnam has the second largest population in SE Asia
with about 78 million people. It has huge potential as a market
for US produced goods, services and technology. If Vietnam
remains engaged and open to US companies, more US jobs will be
added to the existing 3.3 million American jobs which already
support the $245 billion in exports from the US to Asia last
year.
Second, with the negative affect of the Asian Financial
Crisis on US exports and jobs, which will be down around $30
billion this year, we need to open more markets, not close the
door further.
We will not hide the fact that our nearly 600 members find
Vietnam a difficult market to enter. But I point out that our
membership is increasing, most of us are doing-business in
Vietnam and, we have success stories to tell. Most importantly,
we all have a positive long term view on Vietnam's potential
and position in ASEAN.
We also want Americans to know that our member companies
are very much aware of the MIA, human rights, emigration and
religious freedoms issues present in Vietnam, which other
witnesses will raise today. As a large American community
living and working in Vietnam, we participate and engage the
Vietnamese in these issues in our daily lives. Our Amcham Board
of Governors includes veteran groups and humanitarian NGO
members, and they have visible and active committees in our
organization.
The affect of the 30 year embargo on Vietnam was like
locking a child in his room for 30 years and feeding him only
bread and water. We cannot expect the child to emerge from the
locked room as an educated scholar, married and with a well-
adjusted family.
Certain individuals and groups, not living in Vietnam,
expect Vietnam to have emerged from it punishing isolation as a
``new and improved'' version of American society. This is not
realistic. It cannot possibly happen that easily and there is
no precedence for it. Not even in American history. It takes
time and struggle.
America must engage Vietnam to nurture and develop our
ideals for democracy, religious freedom and basic human and
labor rights.
Lifting the embargo has already started the process of
change in Vietnam. Waiving the Jackson-Vanik amendment has
taken it another step forward. In just a few short years;
English has replaced Russian and French as the
second language of the Vietnamese,
The National Economics University in Hanoi, has
established its first internationally recognized Master in
Business Administration (MBA) program,
Satellite TV stations like, CNN, ESPN, and
international publications like The Wall Street Journal and USA
Today are widely available to the Vietnamese population,
The government is decentralizing investment
decision making and a stock market is in the works,
Vietnam's decision making body, the National
Assembly, has more women representatives (on a percentage
basis) than our own Congress,
Large state owned enterprises are being equitized
and are insisting on American technology in their
infrastructure projects with foreign companies (e.g., $1.3
billion Dung Quat oil refinery project between Petrovietnam and
the Russians),
MIAs are coming home,
And the thousands of catholic churches are
overflowing on Sundays.
Unilateral penalties and sanctions on the Vietnamese
government, inhibiting American individuals, organizations and
business in Vietnam will have the opposite affect in achieving
their well-intentioned goals. In fact it will give our
competitors an upper hand in Vietnam, as they will not
participate in our policy towards Vietnam. As we have witnessed
in Indonesia, only by educating the people and engagement can
we make change in Vietnam happen too.
The Asian Financial Crisis has handed America the unique
opportunity to step-in and take the lead in shaping the future
of Vietnam, and Asian countries in general. Lets step-in and
strengthen our relationship with Vietnam and increase their
dependence on us.
It is easy to unilaterally discipline and punish your own
child in your own home, but impossible to unilaterally penalize
someone else's child, when no other parents agree to
participate. Let's not make that mistake with Vietnam. Let's
engage and nurture Vietnam to get the desired result.
Now, speaking to you as Chief Representative of CIGNA,
resident in Vietnam....
During the embargo, the insurance market in Vietnam was
monopolized by the state-owned insurance company Bao Viet.
Since lifting the embargo, Vietnam unilaterally saw the need to
create a competitive insurance market to attract foreign
investment. To date, there is over $30 billion in new foreign
investment, and six new insurance and reinsurance companies in
just the past three years; two (2) state-owned, two (2) foreign
joint ventures, and two (2) joint-stock companies. There are
over 30 insurance company representative offices, including
four (4) American companies; i.e, Aetna, AIG, CIGNA and John
Hancock.
The next step is 100% foreign-ownership. A recent letter
from the Communist Party dated May 25, 1998, includes the
instructions to open the market further and include 100%
foreign-ownership.
While the opening of the market is too slow from my
perspective, it is a positive step in the right direction.
Further, it is likely that the first 100% foreign-owned license
will go to an American insurance company. But only if the US
government continues to positively engage Vietnam. CIGNA
applied for a 100% foreign-owned license earlier this year. And
we are still patiently waiting.
A joint resolution to negate the renewal of the President's
waiver under the Jackson-Vanik amendment will give our
competitor countries a stronger position in Vietnam and further
weaken our progress.
To date, CIGNA has spend over $2,000,000 in Vietnam,
including expenditures in developing the insurance industry.
Education and training has gone to groups of individuals in the
Insurance Supervisory Department in the Ministry of Finance and
the local insurance companies licensed in Vietnam. Our American
style and approach to competition and in handling customers
fairly and honestly is changing the market dramatically in the
right direction. This demonstrates that engagement works.
On a personal note.
My wife is Vietnamese. We met and were married in Vietnam
last year. Several of my friends have also been through the
process and it gets easier and easier each time, as the
Vietnamese government gains more exposure to the idea and
experience in handling the procedures.
My wife's ability to freely travel to other countries is
only limited by the country she wants to visit. She is
currently on vacation in Europe, because the US would not give
her an entry visa to be with me here today.
Vietnam no longer requires its citizens to obtain ``exit''
visas in their passports. They are free to leave and return as
they please, as long as they have a passport. There are no
onerous departure fees levied on Vietnamese, as they do in
Indonesia to inhibit Indonesians from leaving their country,
for instance.
She is free to leave and return to Vietnam anytime she
wants, just as I can leave and return to the US. NOT because
she is married to me, but because the Vietnamese government
passed laws allowing all Vietnamese passport holders to do just
that.
In summary, engagement is working, albeit slower than some
of us expect. Progress is happening in areas of investment,
human and labor rights (like freedom of association and
speech), repatriation of MIAs, emigration, and religious
freedoms.
By renewing the waiver under the Jackson-Vanik amendment,
giving American companies access to loans from TDA, EXIM and
OPIC, and continuing to work towards a bilateral trade
agreement, Congress is setting in motion opportunities to
create more US exports and US based jobs in America. This in
turn keeps the pressure on Vietnam. American companies, NGOs
and individuals working in Vietnam spread our ideals deep into
the social fabric of the Vietnamese. And only the Vietnamese
can demand and make change happen in their government's
policies towards them. Let's keep the pressure on through
engagement.
Thank you.
Chairman Crane. Thank you, Mr. O'Dore.
Ms. Foote.
STATEMENT OF VIRGINIA B. FOOTE, PRESIDENT, U.S.-VIETNAM TRADE
COUNCIL
Ms. Foote. Thank you, Chairman Crane. I'm pleased to be
here today as president of the U.S.-Vietnam Trade Council, to
testify in strong support of the renewal of the Jackson-Vanik
waiver for Vietnam.
The U.S.-Vietnam Trade Council was founded in 1989 and is a
trade association with members from the American Business
Community. We have worked through our educational affiliate,
the U.S.-Vietnam Forum, to improve relations between the United
States and Vietnam, with educational exchange programs, annual
conferences, congressional delegations, and programs designed
to provide the Vietnamese assistance on international trade
norms and standards.
Today I would like to address why the renewal of the
Jackson-Vanik waiver for Vietnam is so important both to the
United States and to Vietnam. Beginning in the late eighties,
Vietnam embarked on a bold economic reform program which showed
impressive results almost immediately. Growth rates have
claimed to 8 and 9 percent. From 1988 to 1996 over $26 billion
in foreign investment was committed. And starting with from a
very low per capita income of only $250 a year, the
international donor community began generous overseas
development assistant programs pledging $2.4 billion in 1997,
which adds to the $8.5 billion pledged since 1993.
Vietnam has made tremendous in establishing relations with
Europe, within Asia and with the United States. Vietnam joined
ASEAN in 1995, will join APEC this November, and is committed
to joining WTO. But the United States normalization process has
moved far more slowly than other nations have, and American
business involvement in Vietnam has lagged as a result of this
and continues to operate with severe handicaps.
Without MFN status, without a trade agreement, and
initially without trade support programs, American companies
and individuals nonetheless began travelling, investing and
trading with Vietnam. In 1997 the United States was the eighth
largest investor in Vietnam, was the eighth largest trading
partner, with $1.2 billion in investment committed and $1
billion worth of two-way trade.
In the last year, the Vietnam Embassy here in Washington
has issued some 91,000 visas to Americans wishing to travel to
Vietnam, over 66,000 of those for Vietnamese-Americans wanting
to visit their homeland, and I understand 200,000 visas have
been issued worldwide for Americans to travel to Vietnam. But
in 1997 Vietnam's impressive growth began to slow. While
Vietnam is in a sense one step removed from the Asian financial
crisis with a nonconvertible currency and plans for a stock
market still in the future, 70 percent of its foreign
investment had been coming from Asian countries as does nearly
70 percent of its international trade.
It is in this difficult environment that the United States
is now negotiating a trade agreement with Vietnam and is
opening Ex-Im Bank and OPIC programs for American companies
there. U.S. policy has pegged Jackson-Vanik to progress on the
ROVR Program. On the merits of progress on ROVR alone, Jackson-
Vanik ought to be renewed. If you expand it to look at the
Orderly Departure Program overall, Jackson-Vanik ought to be
renewed.
And on the economic front, the renewal of Jackson-Vanik is
equally important to achieving U.S. goals. American involvement
in the economic reform process is welcome in Vietnam and could
be extremely important to overall development in the long run.
American companies and government negotiators set a high
standard for trade, investment, labor, and business practices.
American management and technology is greatly admired in
Vietnam. American companies are actively involved in training
programs through my organization and also individually.
American products are popular in Vietnam.
In the process of negotiating comprehensive trade agreement
with the United States, Vietnam has accepted the general
principles outlined in our draft and is now working on the very
difficult task of designing an implementation plan and is
asking for additional technical assistance. The United States
should stay involved in this process. It is in our interest to
see a stronger and more economically healthy Vietnam in the
Southeast Asian region.
Vietnam has set on an economic reform path that many
countries began years ago. It is a process that is going slower
than many of us had hoped, and with American companies coming
in late it has not been easy for American companies to operate
in Vietnam. Yet companies are confident that progress is being
made, there are major infrastructure projects that are in the
pipeline, and with the help of Ex-Im and OPIC, American
companies are in a strong position to win over $2 billion worth
of projects in the next few months. With fully normalized
economic relations, the United States could well be one of the
top investors in Vietnam. My colleagues here are outlining some
of their success stories.
In addition, with the initial waiver of Jackson-Vanik, the
Vietnamese have greatly sped up the trade negotiations with us
and have set an ambitious goal of finishing the trade agreement
by the end of this year. The issues on the table such as
liberalizing the trade and investment regimes, the
strengthening of intellectual property rights, are all of great
importance to anyone doing business in Vietnam, now or in the
future, or anyone hoping to see Vietnam's standard of living
increase. Vietnam's strategic and economic role in the region
will be greatly affected by U.S. policy overall, and by the
course of the bilateral relationship, even in the short run.
The bipartisan policy of a step-by-step process normalizing
relations with Vietnam, while we feel it has been too slow, it
has produced positive results for American interest. The
Jackson-Vanik waiver has produced important results, even since
it was initially waived by the President in March of this year
and it is crucial that the waiver be renewed at this important
time in our relationship. Thank you, Mr. Chairman.
[The prepared statement and attachments follow:]
Statement of Virginia B. Foote, President, U.S.-Vietnam Trade Council
Chairman Crane, members of the Committee, I am pleased to
be here today as President of the U.S.-Vietnam Trade Council to
testify on the renewal of the Jackson-Vanik waiver for Vietnam.
If there are no objections, I would like to submit into the
record letters that we circulated to Congress and to the
President in support of the waiver and a fact sheet we have
done in cooperation with other groups on the importance of this
waiver.
The U.S.-Vietnam Trade Council, founded in 1989, is a trade
association with members from the American business community.
A list of our members is attached to my testimony. With offices
in Washington and Hanoi we have worked along with our
educational affiliate the U.S.-Vietnam Forum to improve
relations between the United States and Vietnam with
educational exchange programs, annual conferences,
Congressional delegations and programs designed to provide
assistance on international trade norms and standards.
Today I would like to address why the renewal of the
Jackson-Vanik waiver for Vietnam is so important to both the
United States and to Vietnam. Beginning in the late 1980's
Vietnam embarked on a bold economic reform program which showed
impressive results almost immediately. Vietnam went from near
famine to become the third largest rice exporter behind
Thailand and the United States in a matter of a few years.
Growth rates climbed to 8 and 9%. Foreign investors flocked to
Vietnam. From 1988 -1996 over $28 billion was committed. And
with a very low per capita income of only $250 per year, the
international donor community began generous foreign
development assistance programs reaching pledges of $2.4
billion in 1997, adding to the $8.5 billion pledged since 1993.
Also beginning in the late 1980's the Vietnamese government
committed to end its isolation and began working to normalize
relations with its neighbors, Europe and the United States.
Vietnam has had tremendous diplomatic success in normalizing
relations in Europe, within Asia and with the United States.
Vietnam joined ASEAN in 1995 and will join APEC this November.
The Reagan and Bush administration recognized Vietnam's
attempt to end its isolation and responded with a policy of
normalizing relations with Vietnam with a step-by-step process
pegged to cooperation on the U.S.'s principal goal of seeking
the fullest possible accounting for our missing in action from
the Vietnam War.
As the attached timeline shows, this process has proceeded
slowly through three administrations but has led to the lifting
of the trade embargo, the establishment of diplomatic relations
and the beginnings of economic normalization. In response,
Vietnam has greatly enhanced its efforts on issues of high
priority to the U.S. including the MIA/POW efforts, immigration
goals, and now economic reform.
But because the U.S. normalized relations far more slowly
than other nations, American involvement in the Vietnamese
economy has come later than other nations and still operates
with severe handicaps. Without MFN status*, a trade agreement,
and initially without trade support programs, American
companies and individuals began traveling, investing and
trading with Vietnam. By 1997 the United States was the eighth
largest investor and eighth largest trading partner with $1.2
billion in investment committed and $ 1 billion in two way
trade. In the last year alone some 91,500 visas have been
issued for Americans to travel to Vietnam, over 66,000 for
Vietnamese Americans wanting to visit their home land.
---------------------------------------------------------------------------
*Only 5 countries do not have MFN status: Afghanistan, Cuba, Laos,
North Korea, and Vietnam.
---------------------------------------------------------------------------
In 1997, Vietnam's impressive growth began to slow. Foreign
investment dropped by 40%. While the growth rate hit 8.8%, the
projections for equal levels of growth in 1998 began to look
overly optimistic. The easy parts of economic reform had been
accomplished. Harder issues loom large. And although Vietnam is
in a sense one step removed from the Asian financial crisis
with a non-convertible currency and plans for a stock market
still in the works, 70% of its foreign investment had been
coming from Asian countries as does nearly 70% of its trade.
It is in this difficult environment that the U.S. is now
negotiating a trade agreement with Vietnam and opening Eximbank
and OPIC programs after the March 1998 initial waiver of
Jackson-Vanik amendment.
U.S. policy has pegged the Jackson-Vanik waiver to progress
on the ROVR program. On the merits of progress on the ROVR
program alone, Jackson-Vanik ought to be renewed. And in
assessing the Orderly Departure immigration program overall,
Jackson-Vanik ought to be renewed. Close to half a million
Vietnamese have come to the United States under ODP with fewer
than 7,000 applicants left to be processed. Another 2,500 ROVR
cases out of a universe of nearly 19,000 are left to be cleared
for interview, with half of these cases missing due to address
or name errors. Since the initial waiver of Jackson-Vanik, the
Vietnamese have allowed all remaining ODP cases--including the
Montagnard cases which are of particular concern to the U.S.--
to be processed under the new and far quicker system developed
by the Vietnamese initially just for ROVR cases.
On the economic front, the renewal of Jackson-Vanik is
equally important for achieving U.S. goals. American
involvement in economic reform process is welcome in Vietnam
and could be extremely important to overall development in the
long run. American companies and government negotiators set a
high standard for trade, investment, labor and business
practices. American management and technology is greatly
admired in Vietnam. American companies are actively involved in
training programs through the Trade Council and individually.
American products are popular. With a population of 77 million
with over half under the age of 25 and well educated, Vietnam
has great potential as a significant trading partner.
In the process of negotiating a comprehensive trade
agreement with the United States, Vietnam has accepted the
general principles outlined in our draft and is now working on
the very difficult task of designing an implementation plan and
is asking for technical assistance. The United States should
stay involved in this process. It is in our interest to see a
stronger and more economically healthy Vietnam in the Southeast
Asian region. Yes, Vietnam has a corruption problem. Yes,
Vietnam is mired in bureaucracy. Yes, they are fearful of
massive unemployment if they let the state enterprise system
go. Yes, they worried about what lessons are to be learned from
the economic crisis in the region.
But Vietnam has also set out on an economic reform path
that other countries began years ago. It is a process that has
been slower than many hoped and with American companies coming
in late, it has not been easy for American companies to operate
in Vietnam. But companies are confident that progress is being
made, major infrastructure projects are in the pipe line, and
with the help of Exim and OPIC American companies are in a
strong position to win over $2.0 billion worth of projects in
the next few months. With fully normalized economic relations,
the United States could well join the top ranks of investors in
Vietnam. My colleagues here have outlined some of the important
individual success stories.
In addition, since the initial waiver of Jackson-Vanik, the
Vietnamese have greatly sped up the trade negotiations and set
an ambitious goal of finishing the agreement by the end of
1998. The issues on the table such as liberalizing the trade
and investment regimes and the strengthening of intellectual
property rights are of great importance to anyone doing
business in Vietnam, now or in the future, or anyone hoping to
see Vietnam's standard of living increase.
Vietnam's strategic and economic role in the region will be
greatly affected by U.S. policy overall and by the course of
bilateral relations even in the short run. The bi-partisan
policy of a step-by-step process of normalizing relations with
Vietnam, while slow, has produced positive results for American
interests. The Jackson-Vanik waiver has produced important
results since it was initially waived by President Clinton in
March of this year and it is crucial that the waiver be renewed
at this important time in our relationship.
Thank you.
U.S.-Vietnam Trade Council Membership
Corporate Members
American International Group
American Rice
Amway Corporation
Boeing Company
Caterpillar, Inc.
Chase Manhattan Bank
Chevron Overseas Petroleum
CIGNA
Citibank
The Coca-Cola Company
Craft Corporation
Dresser Industries
Eli Lilly
Enron International
Estee Lauder International, Inc.
Exxon Corporation
Fluor Daniel, Inc.
General Electric
IBM
Johnson & Johnson
Mobil Oil Corporation
Motorola
Nike Inc.
Oracle Corporation
The Procter & Gamble Company
Raytheon
Skadden, Arps, Slate, Meagher & Flom
Texaco Inc.
Unocal
White & Case
Associate Members
Ablondi, Foster, Sobin & Davidow, P.C.
Archeon International
Asia Joint Partners
Cardinal Consulting Inc.
DeMatteis Ireland USA, Inc.
East & West Trading Company
Finansa Thai Ltd.
Footwear Distributors and Retailers of America
The Harker Firm
JNS International
James V. Kimsey
Long Pham International, Inc.
Manolis & Co., Ltd.
M. West Consulting
Powell, Goldstein, Frazer & Murphy
Samuels International Associates, Inc.
Thomas W. Sloop
Spivey International, Inc.
Toy Manufacturers of America
VinaTech
Virginia Port Authority
THE 1998 JACKSON-VANIK AMENDMENT RENEWAL FOR VIETNAM
What is the Jackson-Vanik Amendment?
It is an amendment to the U.S. Trade Act of 1974 which
precludes the participation of nonmarket economy countries in
any U.S. Government program that extends credits or credit and
investment guarantees if the country restricts emigration.
Before the waiver was issued, American projects in Vietnam were
not eligible for assistance from the Export-Import Bank (EX-IM)
or the Overseas Private Investment Corporation (OPIC). To
remove this restriction on a country such as Vietnam, the
President must either certify that the country permits free
emigration, or the President can waive the emigration
requirement on the grounds that the waiver will promote U.S.
emigration objectives. On March 11, 1998, President Clinton
announced his decision to issue a waiver of the Jackson-Vanik
Amendment for Vietnam.
Why the Jackson-Vanik waiver is important?
The availability of export promotion programs is a critical
factor in a number of major procurement decisions being made
now in Vietnam. The ability of U.S. companies to utilize EX-IM
or OPIC now places them on a more level playing field with
their foreign competitors who have enjoyed a high level of
government support for their projects in Vietnam. Though the
U.S. currently is the eighth largest investor in Vietnam, the
investment and trade opportunities for U.S. companies could
expand significantly with access to EX-IM and OPIC financing.
What did Vietnam need to do?
For Vietnam, the Administration specifically pegged
satisfactory implementation of the Resettlement Opportunity for
Vietnamese Returnees (ROVR) program to the waiving of the
Jackson-Vanik amendment. During Secretary of State Madeleine
Albright's trip to Vietnam in June 1997, she stated: ``I was
very encouraged by commitments I received from the Vietnamese
officials concerning the refugee resettling program. The
official acknowledged that problems had occurred at the outset
but promised significantly more rapid progress from here on
out. If that progress materializes, I expect to be able to
recommend to President Clinton that he waive the Jackson-Vanik
provision soon. And as you know, this would clear the way for
EX-IM Bank and a number of other programs.'' Once a new ROVR
procedure was instituted by the Vietnamese in October 1997,
implementation became very effective.
What role does Congress play now?
Under the President's authority, the waiver goes into
effect immediately with an executive order published in the
Federal Register. On an annual basis, the President must submit
to Congress by June 3rd a request to renew his authority to
issue waivers of the Jackson-Vanik amendment in principle.
Congress then has the opportunity to reject the overall
authority, or to withhold it for an individual country through
a joint resolution of disapproval which must pass both the
House and Senate before September 1st. This year China, Vietnam
and Belarus are on the Jackson-Vanik waiver list. If Congress
does not act the authority is automatically renewed.
What does this initial waiver of Jackson-Vanik do?
1. It allows EX-IM to begin operations with U.S. companies
doing business in Vietnam.
2. It allows OPIC operations to begin. OPIC also requires
the signing of a bilateral agreement specific to OPIC and a
labor determination that Vietnam is taking steps to implement
internationally recognized worker rights. The bilateral
agreement and labor determination are completed.
3. It allows the Agency for International Development (AID)
to expand operations in Vietnam.
4. It allows the Maritime Administration (MARAD) to begin
project support in Vietnam.
MFN : What the Jackson-Vanik waiver for Vietnam does not do
The waiver does not grant Most Favored Nation Trade Status
(MFN) to Vietnam as the Jackson-Vanik waiver is only one step
in the MFN process. A bilateral trade agreement must first be
negotiated and signed and then Congress must vote whether or
not to approve the extension of MFN status to Vietnam. (While
trade negotiations have begun, they are expected to continue
through the rest of 1998.) This year's waiver will renew MFN
status for China and Belarus, but not for Vietnam.
28 January 1998
Member of Congress
United States Senate/House of Representatives
Washington, DC
Dear Senator/Representative:
As associations representing companies interested in Vietnam, we
urge you to support a Presidential waiver of the Jackson-Vanik
Amendment for Vietnam. As the attached chronology shows, bilateral
relations between the two countries have improved since President
Reagan first initiated the normalization process in 1987. Nevertheless,
our two nations have yet to normalize commercial relations fully. The
opening of the U.S. Consulate in Ho Chi Minh City and the continued
support of Ambassador Peterson in Hanoi have been important steps in
that direction; however, more must be done to put our companies on a
par with foreign competitors in the country.
To this end, the availability of U.S. government trade and
investment agencies in the country has been one of our highest
priorities. The lack of such programs places our companies at a severe
disadvantage with respect to foreign competitors who enjoy a high level
of government support for their projects in Vietnam. With the granting
of a Jackson-Vanik waiver for Vietnam, the first obstacle to opening
the Export-Import Bank of the United States and the Overseas Private
Investment Corporation in Vietnam will be cleared. With financing
assistance from these government agencies, investment and trade
opportunities for U.S. companies will expand significantly. Only by
proactively supporting U.S. business in Vietnam can these goals be met.
We urge you to support the Administration's work to normalize
commercial relations with Vietnam fully. We stand prepared to support
these efforts.
Sincerely,
American Chamber of Commerce, Hanoi
American Chamber of Commerce, Ho Chi Minh City
American Chamber of Commerce, Hong Kong
American Farm Bureau Federation
Asia Pacific Council of American Chambers of Commerce
Emergency Committee for American Trade
Footwear Distributors and Retailers of America
National Association of Manufacturers
National Foreign Trade Council
Pacific Basin Economic Council, US Committee
Petroleum Equipment Suppliers Association
USA * Engage
US Chamber of Commerce
US Council for International Business
US-Vietnam Trade Council
Value Manufacturers of America Association
Vietnam Business Committee of the US-ASEAN Business Council
Vietnamese Chamber of Commerce in Orange County
23 June 1997
President William Jefferson Clinton
The White House
1600 Pennsylvania Avenue
Washington, DC 20500
Dear Mr. President:
We write to urge you to give favorable consideration to
establishing full economic normalization with Vietnam. Secretary of
State Madeleine Albright's upcoming trip to Vietnam presents a fresh
opportunity to review U.S.-Vietnam relations. As companies and
associations who are interested in trade and investment in Vietnam, we
applaud you for lifting the trade embargo and establishing diplomatic
relations with Vietnam in your first term. With the establishment of
diplomatic relations in July 1995, the beginning of negotiations for a
bi-lateral trade agreement earlier this year and the arrival of
Ambassador Pete Peterson, we are hopeful that 1997 will see great
progress in commercial relations.
For immediate action, we urge that a U.S. consulate can be opened
in Ho Chi Minh City since it is the hub of Vietnam's business activity
with many U.S. companies and citizens based there. The establishment of
a consulate would be of great assistance to all Americans living and
traveling in the south.
We also urge you to support the opening of Export-Import Bank,
Overseas Private Investment Corporation and U.S. Trade and Development
Agency programs in Vietnam by late summer. The availability of export
promotion programs is a critical factor in a number of major
procurement decisions being made by Vietnam. The inability of U.S.
companies to utilize the Export-Import Bank or OPIC places them at a
serious competitive disadvantage. We therefore urge the Administration
to act immediately to waive the Jackson-Vanik amendment in preparation
for Ex-Im Bank and OPIC to begin support for projects in Vietnam.
The availability of export financing and the conduct of trade on
the basis of reciprocal most-favored-nation treatment are crucial to
the ability of U.S. companies to compete on an equal basis in this
emerging market. Opportunities and market share in Vietnam will
otherwise continue to be taken by our international competitors whose
initial advantages will be difficult, if not impossible, to overcome.
We therefore support the continuation of the trade agreement
negotiations and hope they will continue in an expeditious manner,
leading to meaningful market access for U.S. companies and reciprocal
MFN status.
We encourage the Administration, overall, to continue the process
of economic normalization which it has already begun. We stand ready to
be of assistance to you.
Sincerely,
Companies
Ablondi, Foster, Sobin & Davidow
AIG
Airport Group International
Allied Signal
APL Limited
AMP Incorporated
Bechtel Group Inc.
Black & Decker (U.S.), Inc.
Black & Veatch
The Boeing Company
Burrit Associates Caterpillar, Inc.
The Chase Manhattan Bank
Chevron Corporation
CIGNA Corporation
Citicorp/Citibank
The Coca-Cola Company
Conoco
Corestates Bank
Craft Corporation
DeMatteis International Group
Digital Equipment
Dresser Industries
DuPont
Eastman Kodak
Ellicott International
Enron International
Eveready Battery Company
Exxon
Fluor Corporation
Foster Wheeler Energy International
The General Electric Company
The Harker Firm
Harris Corporation
IBM Corporation
IPAC Corporation
KHM Inc.
Lockheed Martin
McDermott Incorporated/Babcock & Wilcox
Mobil Inc.
Motorola
Oracle Corporation
Ormat International
Pragmatics, Inc.
Procter & Gamble
Raytheon International Inc.
Saigon Express Corp.
Samuels International Associates
Spivey International Inc.
Tampa Bay International
Tradespan International
Unisys Corporation
United Technologies
Unocal Corporation
U.S. Trade & Investment Company
Vietnam Management Initiative
Vietnam Venture Group
Vina USA Inc.
White & Case
Associations
Aerospace Industry Association
American Chamber of Commerce-Hanoi
American Chamber of Commerce-Ho Chi Minh City
Footwear Distributors and Retailers of America
National Association of Manufacturers
National Foreign Trade Council
Pacific Basin Economic Council-U.S. Committee
Petroleum Equipment Suppliers Association
U.S. Chamber of Commerce
U.S. Council for International Business
U.S.-Vietnam Trade Council
Value Manufacturers Association of America
Vietnam Business Committee of the U.S.-ASEAN Business Council
Chronology of Normalization of U.S.-Vietnam Relations under Presidents
Reagan, Bush and Clinton
August 1987--Under the Reagan Administration, General John
Vessey visits Vietnam for discussions on cooperation and to
resolve the fate of American servicemen missing in action.
1988--Vietnam and the U.S. begin joint MIA programs.
April 1991--President Bush's Administration presents Hanoi
with ``roadmap'' plan for phased normalization of ties. Both
sides agree to open U.S. government office in Hanoi.
October 1991--Vietnam supports U.N. peace plan for
Cambodia. Secretary of State James Baker says Washington is
ready to take steps toward normalizing relations with Hanoi.
December 1991--Bush Administration lifts ban on organized
U.S. travel to Vietnam.
April 1992--Bush Administration eases trade embargo by
allowing commercial sales to Vietnam for basic human needs and
allows establishment of telecommunications links with Vietnam.
July 2, 1993--President Clinton clears way for resumption
of international lending to Vietnam.
Jan. 27, 1994--Senate vote urging Clinton to lift embargo.
Feb. 3, 1994--Clinton lifts trade embargo.
Jan. 28, 1995--United States and Vietnam sign agreements
settling old property claims and establishing liaison offices
in each other's capitals.
May 15, 1995--Vietnam gives U.S. presidential delegation
batch of documents on missing Americans, later hailed by
Pentagon as most detailed and informative of their kind.
June 1995--Veterans of Foreign Wars announces support of
U.S. normalization of diplomatic relations with Vietnam.
July 11, 1995--Clinton announces ``normalization of
relations'' with Vietnam.
Aug. 6, 1995--Secretary of State Warren Christopher visits
Hanoi to open U.S. Embassy.
Sept. 11, 1995--Congress votes to impose Presidential
certification of Vietnam's cooperation in POW/MIA activities
requirement on expansion of U.S. Embassy funding.
April 1996--U.S. Department of Commerce Foreign Commercial
Service office opens.
May 1996--U.S. presents Vietnam with trade agreement
blueprint.
May 23, 1996--Clinton Administration announces nomination
of Congressman Pete Peterson, former Vietnam War veteran and
prisoner of way, as U.S. Ambassador to Vietnam.
April 7, 1997--Vietnam agrees to repay debts of $146
million of the former government of South Vietnam. The Debt
Accord was signed by U.S. Treasury Secretary Robert Rubin in
Hanoi.
April 10, 1997--Senate confirms Congressman Pete Peterson
as ambassador.
April 1997--U.S. presents Vietnam with trade agreement
draft.
April 16, 1997--Vietnam agrees to sign a copyright
agreement.
May 9, 1997--Peterson takes up post as ambassador in Hanoi.
May 9, 1997--Vietnam's ambassador to the United States, Le
Van Bang, arrives to take up post.
June 1997--Secretary of State Albright visits Vietnam to
open U.S. consulate in Ho Chi Minh City and promises a waiver
of Jackson-Vanik with progress on ROVR emigration program.
June 1997--The U.S. Trade and Development Agency opens for
Vietnam.
October 1997--Vietnam institutes new processing procedure
in ROVR program significantly improving progress.
November 1997--Vietnam opens consulate in San Francisco,
CA.
March 10, 1998--President Clinton waives the Jackson-Vanik
Amendment for Vietnam paving the way for EXIM and OPIC
operations.
March 19, 1998--OPIC and Ambassador Le Van Bang sign the
OPIC bilateral for Vietnam in Washington.
March 26, 1998--Minister of Planning & Investment Tran Xuan
Gia and Ambassador Pete Peterson finalize the signing of the
OPIC bilateral for Vietnam.
June 3, 1998--President Clinton submits to Congress
extension of the Jackson-Vanik waiver authority, which includes
a waiver for Vietnam.
Chairman Crane. Thank you, Ms. Foote. Perfect timing.
[Laughter]
And our next witness is Greig Craft.
STATEMENT OF GREIG CRAFT, VICE CHAIRMAN, ASIA PACIFIC COUNCIL
OF AMERICAN CHAMBERS, HANOI, VIETNAM
Mr. Craft. As vice chairman of APCAC, the Asia Pacific
Council of American Chambers, I thank you for the opportunity
to share our position with respect to Vietnam, as well as to
provide firsthand observations as a result of my 9 years of
residency in Hanoi. I would like to reemphasize the points made
by our colleagues that all businessmen in Vietnam share the
concerns of Americans for the fullest possible accounting of
MIA and also with respect to human rights.
Twenty-five years after the end of hostilities, Vietnam
still conjures up an image of war, not a nation of young people
and families in the minds of far too many Americans. The
reality is Vietnam is eager to embrace America and a market-
driven approach to business. Most Vietnamese were born after
1975 and as such have no firsthand recollection of the war.
They have a difficult time understanding America's seeming
unwillingness to put the war behind us. The gradual opening of
this society over the past 10 years has been directly
correlated to improvements in the overall relationship based on
the principle of mutual benefit.
Members of APCAP represent more than 40,000 business
executives and more than 6,600 companies in 18 countries
including Vietnam. In our experience, our presence in these
countries has helped foster openness and reform. It's our
position that Vietnam with its young and well-educated
population offers significant opportunities to help sustain
this economic growth, provided our companies remain competitive
there through access to programs such as Ex-Im, OPIC and TDA.
Vietnam has the second largest population in Southeast Asia
and the opportunities for United States manufacturers are
immense. Well-known brands such as Coca-Cola, Pepsi, Kodak,
Proctor and Gamble and others already are market leaders in
many instances. Access to television programming such as MTV,
CNN, even NBC, only adds to this consumer brand awareness and
provides a window to our society and a different way of life
for its young people.
And Vietnam's strategic location on China's southern border
makes it of pivotal political importance to the United States
as well. Its dynamism is further reflected in the recent
selection of younger leaders to the position of Prime Minister,
President, and the Chairman of the National Assembly. All of
these gentlemen are associated with reform. It's interesting to
note that their National Assembly has a higher percentage of
women than even our own House of Representatives.
Vietnam's desire to join the world community is evidenced
by its entry into many numerous international organizations.
However, as a part of its globalization initiative, Vietnam
wants and needs to fully normalize relations with the United
States. In our opinion, it's in our national interest to
maintain a fully normalized, economic and political
relationship with Vietnam. If further developed, it will
provide stability and leadership in the region, something that
is certainly urgently needed in this current situation.
It's interesting to note that ordinary citizens show much
goodwill toward Americans living in Vietnam and there are many
humanitarian programs being carried out by the people of both
countries. Tens of thousands of Vietnamese-Americans who you
will not hear from today, have returned to Vietnam to work and
visit. Many are former boat people, or the children of boat
people. They're eager and enthusiastic to contribute to
Vietnam's modernization. It's important that once and for all
we ease the pain and divisiveness that have troubled the
national psyche of America for 25 years. It's time to continue
building the relationship with Vietnam and time to move on to a
new era of peace and forgiveness. Constructive engagement by
the U.S. Government toward Vietnam is a policy which we should
continue. American businesses are certainly attempting to do
this. This type of engagement has been greatly responsible for
the gradual opening up of the country which has taken place
since 1994.
For example, since 1995 our company, Craft Corporation, has
led the development of Vietnam's first direct reduced iron
plant. Our $300 million project will be the first American
involvement in Vietnam's emerging steel industry. It will
create a valuable feedstock required even by our own steel
producers here in the United States. Our American consortium
including partners Raytheon, Enron and Midrex will utilize U.S.
technology, U.S. services and U.S. equipment in the
implementation of this important infrastructure project. We
were awarded the first TDA grant to Vietnam last September and
have recently submitted an application to OPIC for financing of
$150 million. Discussions with Ex-Im regarding additional
financing and insurance are also underway.
The denial of the programs available with the Jackson-Vanik
extension will force Vietnam to go to other countries for their
investment, raw materials and trade. The target of the
naysayers therefore will not be Vietnam, but United States
companies, United States workers, indeed the United States
economy. Denial of these programs becomes a form of unilateral
sanctions, which in the end hurts everyone, but principally
America. This should not be our policy. Denying Jackson-Vanik,
we believe, is the wrong action at the wrong time. Thank you
for considering our views.
[The prepared statement follows:]
Statement of Greig Craft, Vice Chairman, Asia Pacific Council of
American Chambers, Hanoi, Vietnam
Twenty five years after the end of hostilities, Vietnam
still conjures up an image of `war'--not a nation of young
people and families--in the minds of far too many Americans. A
significant number of our fellow citizens still think of
Vietnam as a small insignificant country ``somewhere in Asia'';
yet nothing could be further from the truth. Vietnam is a young
and vibrant country, eager to embrace America and a market
driven approach to business. My name is Greig Craft. In my
capacity as Vice Chairman of APCAC (the Asia Pacific Council of
American Chambers) I am honored to be here today to share with
you our position with respect to Vietnam, as well as to provide
to you first hand observations as a result of my 9 years of
residency in Hanoi.
The members of APCAC represent more than 40,000 business
men and women, and more than 6,600 companies in 18 countries.
Our membership manages trade volumes in excess of $200 billion
and investments of over $50 billion in the region. We serve
America's national interests by fueling the growth of American
jobs and exports which have contributed so significantly to
America's economic success in recent years. It is our position
that Vietnam, with its young and well educated population of
nearly 78 million, offers significant opportunities to help
sustain this economic growth, provided American companies can
remain competitive there through access to essential US
government programs such as EXIM, OPIC and TDA. American
companies operating in Vietnam have invested $1.2 billion to
date, with an additional $2 billion in advanced stages of
development. This is impressive, coming after only 4 years
since the President announced ``normalization of relations''
with Vietnam. But this could increase substantially if full
normalization was in place.
In spite of the obstacles and inherent difficulties of
undertaking business in a developing country like Vietnam,
there has been significant and notable progress in recent
years. Vietnam has the second largest population in SE Asia and
the opportunities for US manufacturers are immense. Well known
brands such as Coca Cola, Pepsi, Kodak, Proctor & Gamble and
others are already market leaders in many instances. Access to
television programming such as MTV, CNN and NBC only adds to
this consumer brand awareness. Its strategic location on
China's southern border makes it of pivotal political
importance to the United States as well. Vietnam's dynamism is
further reflected in the recent selection of younger leaders to
the position of Prime Minister, President, and the Chairman of
the National Assembly. All are associated with reform. It is
interesting to note that their National Assembly has a higher
percentage of women than even our own House of Representatives.
Vietnam's desire to join the world community is evidenced
by it's recent entry into ASEAN, preparations to join the WTO
and the upcoming November entry into APEC. However, as a part
of its globalization initiative Vietnam wants and needs to
fully normalize relations with the United States. It is in the
national interest of the United States to maintain a fully
normalized economic and political relationship with Vietnam in
our opinion. If further developed, it will not only help
sustain economic growth in America, but equally important, will
provide stability and leadership in the region.
Seventy percent of Vietnam's population are under the age
of 25. Most, born after 1975, have no first hand knowledge or
recollection of the war, and indeed, have a difficult time
understanding America's seeming unwillingness to put the war
behind us. We in the business community can help further this
process, and consequent healing, but only if we have the
ability to remain engaged in Vietnam on a day to day basis.
This means we must be able to compete equally with other
foreign companies who enjoy concessionary financing and support
from their respective governments. Continuation of the Jackson-
Vanik waiver is therefore essential to maintain continued
American involvement in Vietnam, for the benefit of American
enterprise.
Since 1995 our company, Craft Corporation, have led the
development of Vietnam's first Direct Reduced Iron plant. Our
$300 million project will be the first American involvement in
Vietnam's emerging steel industry. It will create a valuable
feedstock required even by our own steel producers in the US.
Our American consortium, including partners Raytheon, Enron and
Midrex, will utilize US technology, US services, and US
equipment in the implementation of this strategically important
project. We were awarded the first TDA grant to Vietnam last
September and have recently submitted an application to OPIC
for financing of $150 million. Advanced discussions with EXIM
regarding additional financing and insurance are also underway.
However, without access to these government programs there
would be no alternative but to turn to foreign financial and
equipment sources.
Despite our turbulent past, the United States and Vietnam
have made significant progress toward normalization of
relations. Ordinary citizens show much goodwill toward
Americans living in Vietnam and there are many humanitarian
programs being carried out by people of both countries. Tens of
thousands of Vietnamese-Americans have returned to Vietnam to
visit and work. Many are former boat people, or the children of
boat people. They are eager and enthusiastic to contribute to
Vietnam's modernization. Taking advantage of opportunities in
Vietnam will help sustain, and indeed, increase, job
opportunities for American workers involved in the manufacture
and export of American products to Asia. And equally important,
it will help once and for all to ease the pain and divisiveness
that have troubled the national psyche of America for 25 years.
It is time to continue building a new relationship with
Vietnam, and time to move on to a new era of peace and
forgiveness. Constructive engagement by the US Government
towards Vietnam is a policy which should continue in the
national interest.
But denial of the programs available with the Jackson-Vanik
extension will force Vietnam to go to other countries for their
investment, raw materials and trade. The target of the
naysayers, therefore, will not be Vietnam, but US companies,
workers, indeed the US economy. Denial of these programs
becomes a form of unilateral sanctions which in the end hurts
everyone, both Vietnamese and American. This should not be our
policy.
Denying Jackson-Vanik is the wrong action at the wrong
time.
Thank you for considering our views.
Greig Craft is testifying on behalf of APCAC (the Asia Pacific
Council of American Chambers). He is Managing Director of Craft
Corporation.
[GRAPHIC] [TIFF OMITTED] T8852.001
[GRAPHIC] [TIFF OMITTED] T8852.007
1[GRAPHIC] [TIFF OMITTED] T8852.008
Chairman Crane. Thank you.
And our final witness is Mr. Lalonde.
STATEMENT OF BRADLEY LALONDE, VICE PRESIDENT AND CORPORATE
COUNTRY OFFICER, VIETNAM CITIBANK
Mr. Lalonde. Thank you, Mr. Chairman, for the opportunity
to testify today. My comments will echo those of my colleagues
here and those made earlier this morning for the most part.
Citibank has been in Vietnam now since 1993 when we opened
a representative office in Hanoi after the easing of the
restrictions by President Bush and shortly after the lifting of
the embargo in 1994, we opened a branch in Hanoi, it was our
first branch and just a few months ago we reopened our Ho Chi
Minh City branch being the very first American bank to do that
in the country. And in that 3-year period of time we have
become the largest foreign bank in the country, in a highly
competitive banking industry. There are 26 foreign bank
branches. There are only two American banks: Citibank and Bank
of America, and we are struggling. We got off to a slow start
because of the embargo but obviously we've been making up for
that in a short period of time.
Citibank played a leading role in the American business
community and has fully encouraged complete commercial
normalization. We've also embraced the broader issues, the
front-burner issues as Ambassador Peterson put it, of
supporting the MIA-POW effort. We've never hesitated to
emphasize to the Vietnamese authorities that this is the key to
the relationship and we've always supported this because we
recognize that it is the key for obvious reasons. I think the
business community has played a role in progressing that and
the fact that we are doing business in the country bringing
technology, bringing capital support, with their continued
efforts to cooperate with us and in the 4 years that I've been
in Vietnam I don't have any anecdotal evidence that they're not
fully cooperating.
I've also served as chairman of Amcham for several years
and I've been on the board of the American Chamber in Hanoi for
4 years and I can echo the sentiments of my colleagues that
Vietnam is a market of importance and great potential, and that
is why we're there and many of our customers are there as well.
It's true that American firms have been handicapped by
inability to access government-backed financing and insurance
from the Export, Ex-Im Bank and the OPIC. And as a banker who
has been doing business in Vietnam for the past 4 years, I can
say that we're at a significant disadvantage to our
competitors. American firms simply are not competitive in
Vietnam without access to Ex-Im Bank and OPIC. Countries such
as Japan, Taiwan, Korea, Singapore and France have dedicated
huge amounts of government funds toward developing market share
in Vietnam.
To be competitive, United States companies need to access
government financing, and to get that financing they are being
forced to go to third countries. As a condition of securing
that financing they're also required to source their products
from those countries. That means they are buying Caterpillar
tractors or GE turbines. You heard mention they found a 60-
year-old Caterpillar. We would like to see some newer equipment
in the country and that's where Ex-Im Bank would certainly come
in handy. Yes, very much so. And that means jobs that would be
created here to build those products, rather than going to
Tokyo and Paris, and that's really the point of the Jackson-
Vanik waiver.
Since the President issued his waiver of Jackson-Vanik
earlier this year, we have made significant strides toward
providing United States companies with financing support in
Vietnam. Both OPIC and Ex-Im have completed steps needed to
begin operations, and are both open for business. In short,
taking away that tool now is akin to transferring jobs to our
major competitors. It would be a terrible blow to American
companies and American workers, and I think it's time that
somebody stands up for American workers in all of this, too.
And it is part of the broader agenda that is coming to the
fore.
Mr. Chairman, the hearing notice for the meeting asked
witnesses to focus on the potential impact on Vietnam and the
United States of a termination of Vietnam's waiver. Well, the
answer is that a termination would be devastating. Despite many
fits and starts, we've made great progress in our bilateral
relationship in a very short period of time, and that the
Vietnamese have worked diligently to address the concerns that
have been raised during this process.
As Ambassador Peterson told you earlier, they're working in
good faith to cooperate with us on MIA issues and many others.
And I don't have any doubt in my mind about that.
They've also agreed to pay the old debts, in fact inherited
from the Government of South Vietnam, as a gesture of, I would
say, more than good faith. They've also agreed to, in Secretary
Albright's visit, the agreement on copyright protection. And
there are other examples of cooperation.
Taking away the Jackson-Vanik waiver now, you know, would
put all of this progress in jeopardy. And who knows how it
might also impact the MIA-POW search and human rights of
religious groups, and so on and so forth.
On a final but personal note, I'd like to mention that
Citibank reopened its Ho Chi Minh City branch after 23 years.
And the guy who opened our branch in Ho Chi Minh City is the
guy who closed our branch in Saigon in April 1975, and that he
has come full circle. He's an American of Vietnamese descent,
and he's back to take part in rebuilding our business in a new
era. And I think that very much says what's happening today.
And we also put our sign on our building in Ho Chi Minh
City, at the top of the building. And to see the look of pride
in the faces of not only our staff, but in the man on the
street, when they see Citibank's name, it says something. And
they feel that--and I see this--that they're reassured of
American business presence because it's symbolic of this new
era and this change that's taking place. And that's why I feel
so strongly about what we're doing is the right thing, and I
would encourage you to continue with this and reject this--I
forget the resolution number, but--120.
[The prepared statement follows:]
Statement of Bradley Lalonde, Vice President and Corporate Country
Officer, Vietnam Citibank
Mr. Chairman, members of the Subcommittee on trade, my name
is Bradley Lalonde, and I am Vice President and Corporate
Country Officer for Citibank in Vietnam. Thank you very much
for inviting me to testify today regarding U.S.-Vietnam trade
relations and, specifically, the proposed resolution of
disapproval regarding renewal of the President's waiver of the
Jackson-Vanik amendment with regard to Vietnam.
Citibank has been operating in Vietnam since 1993 when
President Bush eased trade restrictions and allowed U.S.
companies to establish representative offices. Shortly after
President Clinton lifted the trade embargo, Citibank applied
for a branch license in Hanoi and opened a branch in January
1995. For the last three years, Citibank has provided a wide
range of banking services primarily to our multinational and
top tier local corporate clients. Our services range from trade
and investment finance to electronic banking, foreign exchange
and project finance advisory. In less than three years,
Citibank has become the largest foreign bank in the country.
Citibank has also played a leading role in the American
business community and fully encouraged complete commercial
normalization now for many years. We are convinced that our
efforts to improve commercial relations has helped the
Administration make progress on other goals, as well, such as
the POW/MIA priority. Personally, I have served on the Board of
Governors of the American Chamber of Commerce for over four
years and two of those years, I served as chairman.
Vietnam holds tremendous potential as a market for U.S.
products and services. With a population of 75 million people--
more than half under the age of 25--and with tremendous needs
in infrastructure and human development, it is a country that
deserves our attention.
Although tremendous opportunities exist for firms seeking
to do business in Vietnam, American companies have been
handicapped when compared to their competitors from other
countries as a result of several factors.
First, we got a late start. Because the United States did
not have diplomatic relations with Vietnam until 1994, we
started at a significant disadvantage as compared to companies
from other parts of the world who had been there for years.
Second, the lack of a bilateral trade agreement and most-
favored-nation status for Vietnam puts U.S. firms at a
disadvantage in investing in Vietnam, moving goods in and out
of the country, and leaves us without strong protections for
intellectual property. Negotiations about the structure of a
trade agreement are underway, and our negotiators are doing an
excellent job of moving the talks forward. In fact, we expect
them to return to Hanoi later this month for the next round of
discussions. There is, however, still a long way to go and once
the agreement is concluded, it will still need congressional
approval. I urge you to move that agreement quickly once it
arrives here.
Third, American firms have been handicapped by their
inability to access government-backed financing and insurance
from the Export-Import Bank and the Overseas Private Investment
Corporation. As a banker who has been doing business in Vietnam
for the past four years trying to support American exports and
investment, I can tell you that is a significant disadvantage.
American firms simply are not competitive in Vietnam without
access to the Eximbank and OPIC. Countries such as Japan,
Taiwan, Korea, Singapore and France have dedicated huge amounts
of government funds toward developing market share in Vietnam.
To be competitive, U.S. companies need access to government
financing, and to get that financing they are being forced to
go to third countries. As a condition of securing that
financing, they are required to source their products in those
countries. That means they aren't buying Caterpillar tractors,
or GE turbines, or other products made in the United States.
And that means the jobs that would have been created here to
build those products will instead go to Tokyo and Paris.
Since the President issued his waiver of Jackson-Vanik
earlier this year, we have made significant strides toward
providing U.S. companies with financing support in Vietnam.
Both OPIC and ExIm have completed the steps needed to begin
operations and both are open for business. In short, taking
that tool away now is akin to transferring jobs to our major
competitors. It would be a terrible blow to American companies
and American workers.
Mr. Chairman, the hearing notice for this meeting asked
witnesses to focus on the ``potential impact on Vietnam and the
United States of a termination of Vietnam's waiver.'' The
answer to that question is that a termination would be
devastating. Despite many fits and starts, we have made great
progress in our bilateral relationship in the few years since
President Clinton normalized relations. The Vietnamese have
worked diligently to address the many concerns that we have
raised during this process. As Ambassador Peterson told you
earlier, they are working in good faith to cooperate with us on
MIA issues. They signed the agreement to resolve the issue of
debts owed by the former Government of South Vietnam. And they
signed an initial agreement on copyright protection during
Secretary of State Albright's visit last year. They are making
a real attempt to work with us. I have seen many visitors come
and go to Vietnam over the last four years and the overwhelming
impression that visitors get is that not only is there a real
cooperative relationship in progress to between Vietnam and the
United States, but that many Vietnamese have a strong
preference for American products, services and people.
Taking away the Jackson-Vanik waiver would put all of this
progress in jeopardy and would undercut the efforts of those
within the Vietnamese government who are pushing for more
openness, more contact with the outside world and more
liberalization in economic affairs. It would likely have a
negative impact on their cooperation on MIA issues; and it
certainly would have a negative impact on the ongoing trade
talks. I would note that the first substantive progress made in
the talks came in April--just after the President issued his
Jackson-Vanik waiver. I believe that was an example of an
expression of good faith in response to our show of good faith.
I am willing to bet that a show of bad faith on our part--such
as withdrawing the Jackson Vanik waiver--would result in a
similar show on their part.
Such backsliding on these issues is not in Vietnam's
interest and it is not in ours. Not only will it harm our
economic interests, but I would also argue it would harm our
national security interests, as well, in a very critical area
of the world.
Mr. Chairman and members of the Committee, the decision
that Congress makes on this issue will have significant and
lasting impact on our bilateral relations with Vietnam. As a
representative of Citibank, I can tell you that terminating the
waiver will mean that U.S. companies will lose business to
their competitors from other countries. As an American who has
lived there for 4 years, I can tell you it will lessen the
impact that the United States has in a large, strategically-
located emerging country. I urge you to reject H. J. Res. 120
and allow the President's waiver of the Jackson-Vanik Amendment
to stand.
One final, but personal note. As you may know, Citibank
reopened its Ho Chi Minh branch in January of this year, about
23 years after we closed our Saigon branch. Our branch manager
is the same person that closed the Saigon branch in April 1975.
He is, however, back today as an American of Vietnamese
descent, working to rebuild our business in a new era. When
Citibank raised its sign to the top of one of the most modern
and new business towers, I could see the smiles of pride, not
just on the faces of our staff, but also on the faces of many
people on the street. I get the impression that our presence in
this dynamic city also gives hope and promise to many people
who are assured by an American business presence and encouraged
to continue to embrace market reform and greater openness. We
should not miss the opportunity before us today. It is real and
it is progressing. I hope you get a chance to visit this
dynamic country and experience firsthand, what I have been
trying to convey to you in a few words.
Thank you.
Chairman Crane. Well, folks, let me express appreciation to
all of you for coming and testifying.
We've got two more votes coming up and so the Subcommittee
will now stand in recess subject to the call of the Chair.
Thank you.
[Recess.]
Chairman Crane. Will everybody please take seats and let me
call up our next panel: John Moon, commander-in-chief, Veterans
of Foreign Wars of the United States; John F. Sommer, Jr.,
executive director of the American Legion; George Duggins,
national president, Vietnam Veterans of American; and Thomas
Burch, Jr., chairman, National Vietnam & Gulf War Veterans
Coalition.
The first witness, John Moon's testimony will be presented
by Bruce Harder, director of national security and foreign
affairs.
Now, wait a second, are we missing someone? Mr. Sommer, I
know, had a potential problem, but where's Mr. Burch? Oh, OK,
well, no it's no big deal, I'm just curious as to whether he's
going to make it. All right, well then, we will proceed.
Let's see, Mr. Harder first, and then Mr. Duggins.
STATEMENT OF JOHN E. MOON, COMMANDER-IN-CHIEF, VETERANS OF
FOREIGN WARS OF THE UNITED STATES AS PRESENTED BY BRUCE HARDER,
DIRECTOR OF NATIONAL SECURITY AND FOREIGN AFFAIRS, VETERANS OF
FOREIGN WARS OF THE UNITED STATES
Mr. Harder. OK, sir, as advertised, I am Bruce Harder. We
have our oral statement and our written statement are the same,
and I can get it in under 5 minutes, so I'll proceed, if that's
OK.
Chairman Crane. All right.
Mr. Harder. The Veterans of Foreign Wars of the United
States is pleased to be able to present testimony at the
hearing today. As mentioned, I am standing in for commander-in-
chief John Moon who can't make it today. We understand that the
purpose of today's hearing is to evaluate overall United States
trade relations with Vietnam, and to consider President
Clinton's renewal of Vietnam's waiver under the Jackson-Vanik
waiver to the Trade Act of 1974.
My testimony today is limited to present the VFW's views on
the impact of the President's renewal of Vietnam's waiver on
the prisoner of war and missing in action issue in Southeast
Asia. The POW-MIA issue has been, and remains, a priority issue
with the Veterans of Foreign Wars.
The VFW has been making trips to Vietnam since July 1991.
On our first trip, VFW officials accompanied Congressman Lane
Evans of Illinois and representatives of other veterans'
services organizations to visit Hanoi, Hue City, Ho Chi Minh
City. Since that first visit, the Veterans of Foreign Wars has
made regular annual visits back to Southeast Asia, and on each
trip, our mission has been the same: It is to urge both the
U.S. Government and foreign government officials, and other
veterans' organizations, to diligently work toward resolving
the cases of Americans still missing from the war in Southeast
Asia.
The VFW sends national officers to Southeast Asia each year
to remind all involved that the mission is not yet completed.
We will not rest until the mission is accomplished, and our
missing comrades are accounted for. We will not forget those
who have been left behind, and we want to bring them home to
their families and their country.
Most recently, in March 1998, three of our national
officers, including myself, traveled to Southeast Asia to
demonstrate our continuing commitment to the fullest possible
accounting process for missing Americans from the war. We were
there to express our views and to listen to key U.S. and
foreign government officials, and foreign veterans'
organizations that we consulted.
Also, we went to visit the Joint Task Force for Full
Accounting detachments deployed at field recovery sites in
remote areas throughout the region. We were able to do this in
both Laos and Vietnam. We were there to follow up on reports
received and to collect facts for ourselves. We found the
Americans deployed under the command and control of Joint Task
Force for Full Accounting to be highly motivated, dedicated,
focused on the mission, and inspiring to observe.
Our trips to Vietnam have included trips both before and
after the trade embargo was lifted and diplomatic relations
were established. And since the establishment of diplomatic
relations, we have not seen any diminishing of United States or
Vietnamese efforts to account for our missing men.
On our most recent visit to Vietnam and Laos, we saw no
evidence that current U.S. Government policies on trade were
resulting in any negative impact on the accounting process for
missing in action. On the contrary, we believe that current
United States trade policies have resulted in both gradual
improvements in United States-Vietnamese relations in general,
and proportional improvements in the effort to account for
Americans, in particular.
A few positive examples we saw are better overall United
States-Vietnamese cooperation, the establishment of the joint
document center in Hanoi, the creation of a Vietnamese
unilateral archival research programs which seeks to develop
new information on specific loss incidents, the Vietnamese
Government publicizing activities related to missing Americans.
If there was no diminishing of the fullest possible accounting
effort after the lifting of the embargo and the establishment
of diplomatic relations, it suggests there will be no
diminishing or decreasing of effort now that the Jackson-Vanik
restrictions have been lifted.
Based on our observations and conversations we had with
Joint Task Force for accounting personnel and other U.S.
Government officials during our visit to Vietnam, we believe
that current trade relations with Vietnam have helped rather
than hindered the accounting process for missing Americans.
Also, if we can reach our goal of the fullest possible
accounting by improving or expanding United States-Vietnamese
trade relations, then we ought to do so.
In conclusion, in the past, the United States has had most-
favored-nation trade status with a number of Communist
countries, the most notable relationship is the one we have
with the People's Republic of China. The PRC was a former enemy
during the Korean war, and has not yet fully cooperated on the
accounting of our missing men from that conflict. Our view is
that Vietnam's current cooperation effort on the POW-MIA issue
should serve as a model for the kind of, and quantity--quality,
rather, of support we hope to achieve from China. And,
similarly, the United States-China trade relationship should be
a model for our relationship with Vietnam.
Finally, our goal is to achieve the fullest possible
accounting of Americans missing from the war in Southeast Asia,
as well as all missing Americans from our Nation's past wars
and conflicts.
Mr. Chairman and Members of the Subcommittee, thank you for
this opportunity to present the views of the Veterans of
Foreign Wars of the United States on this issue of United
States-Vietnam trade relations, and I'll be happy to answer any
questions you might have.
[The prepared statement follows:]
Statement of John E. Moon, Commander-in-Chief, Veterans of Foreign Wars
of the United States
Mr. Chairman and Members of the Subcommittee:
The Veterans of Foreign Wars of the United States is
pleased to be able to present testimony at this hearing today.
I am John E. Moon, Commander-in-Chief of the Veterans of
Foreign Wars of the United States.
We understand that the purpose of today's hearing is to
evaluate overall U.S. trade relations with Vietnam and to
consider President Clinton's renewal of Vietnam's waiver under
the Jackson-Vanik Amendment to the Trade Act of 1974.
My testimony today is limited to presenting the VFW's views
on the impact of the President's renewal of Vietnam's waiver
under the Jackson-Vanik Amendment to the Trade Act of 1974 on
the Prisoner of War (POW) and Missing in Action (MIA) issue in
Southeast Asia. The POW/MIA issue has been, and remains a
priority issue with the Veterans of Foreign Wars.
The VFW has been making trips to Vietnam since July 1991.
On our first trip VFW officials accompanied Congressman Lane
Evans of Illinois and representatives of other Veterans Service
Organizations to visit Hanoi, Hue City, and Ho Chi Minh City.
Since that first visit, the VFW has made regular annual visits
back to Southeast Asia. On each trip, our mission has been the
same. It is to urge both U.S. Government and foreign government
officials and other veterans' organizations to diligently work
toward resolving the cases of Americans missing from the war in
Southeast Asia. The VFW sends national officers to Southeast
Asia each year to help remind all involved that the mission is
not yet completed. We will not rest until the mission is
accomplished and our missing comrades are accounted for. We
will not forget those who were left behind. We want to bring
them home to their families and their country.
Most recently, in March 1998, three of our national
officers traveled to Southeast Asia to demonstrate our
continuing commitment to the ``fullest possible accounting''
process for Missing Americans from the war. We went there to
express our views and listen to key U.S. and foreign government
officials and foreign veterans' organizations. Also, we went to
visit Joint Task Force-Full Accounting Detachments deployed at
field recovery sites in remote areas throughout the region,
follow up on reports received and collect facts for ourselves.
We found the Americans deployed under the command and control
of Joint Task Force-Full Accounting to be highly motivated,
dedicated, focused on the mission and inspiring to observe.
Our trips to Vietnam have occurred both before and after
the trade embargo was lifted and diplomatic relations were
established. Since the establishment of diplomatic relations,
we have not seen any diminution of U.S. or Vietnamese efforts
to account for our missing men. On our most recent visit to
Vietnam and Laos, we saw no evidence that current U.S.
government policies on trade were resulting in any negative
impact on the MIA accounting process.
On the contrary, we believe that current U.S. trade
policies have resulted in both gradual improvements in U.S.-
Vietnamese relations in general and proportional improvements
in the effort to account for missing Americans in particular. A
few positive examples are: better overall U.S.-Vietnamese
cooperation; the establishment of a Joint Document Center in
Hanoi; creation of a Vietnamese unilateral archival research
program which seeks to develop new information on specific loss
incidents; cooperation on Trilateral Recovery Operations with
the U.S. and Laos: and, the Vietnamese government publicizing
activities related to missing Americans.
If there was no diminution of the ``fullest possible
accounting'' effort after the lifting of the embargo and
establishment of diplomatic relations, it strongly suggests
there will be no diminution of effort now that the Jackson-
Vanik restrictions have been lifted. Based upon our
observations and conversations we had with JTF-Full Accounting
personnel and other U.S. government officials during our visit
to Vietnam, we believe that current trade relations with
Vietnam have helped rather than hinder the accounting process
for missing Americans. Also, if we can reach our goal of the
``fullest possible accounting'' by improving or expanding U.S.-
Vietnamese trade relations, then we ought to do so.
In conclusion, history reveals that the United States has
maintained ``most favored nation'' trade status with a number
of communist countries. The most notable of these trade
relationships is with the People's Republic of China (PRC). The
PRC was a former enemy during the Korean War and has not yet
fully cooperated on the accounting of our missing men from that
conflict. Our view is that Vietnam's current cooperation and
effort on the POW/MIA issue should serve as a model for the
kind and quality of support we hope to achieve from China.
Similarly, the U.S.-China trade relationship should be a model
for our relationship with Vietnam.
Finally, our goal is to achieve the fullest possible
accounting of Americans missing from the war in Southeast Asia
as well as all Americans missing from all our nation's wars and
conflicts.
Mr. Chairman and Members of the Subcommittee, thank you for
this opportunity to present the views of the Veterans of
Foreign Wars of the United States on the issue of U.S.-Vietnam
Trade Relations. I will be happy to answer any questions you
may have.
Chairman Crane. Thank you, Mr. Harder.
Mr. Duggins.
STATEMENT OF GEORGE C. DUGGINS, NATIONAL PRESIDENT, VIETNAM
VETERANS OF AMERICA
Mr. Duggins. Thank you very much, Mr. Chairman. I ask the
Subcommittee to bear with me, I just returned from New Zealand
and the change in climate has given me a horrific head cold, so
I'm going to give it my best shot.
Chairman Crane. You mean this chilly weather has given you
a cold? [Laughter.]
Mr. Duggins. This chilly weather. Mr. Chairman and Members
of the Subcommittee, Vietnam Veterans of America appreciate the
opportunity to present our views on trade relations between the
United States and Vietnam. VVA is adamantly opposed to the
future normalization of trade relations with Vietnam at this
time, and we urge Congress to disapprove the President's
Jackson-Vanik waiver determination.
VVA is the only Congress-chartered national Vietnam
veterans' organization exclusively dedicated to Vietnam-era
veterans and their families and supporters. As you can expect,
the issue of United States-Vietnam trade relations is one of
the great, serious concerns of our members.
VVA recognizes that the Jackson-Vanik amendment also deals
with human rights and freedom of immigration issues. While
these are very important matters to Congress to consider, these
are issues outside of the purview of our organizational
mandate. VVA strongly feels that the Jackson-Vanik is a tool
available to the U.S. Government in seeking cooperation from
the Vietnamese on the POW-MIA issue.
VVA views on United States-Vietnamese trade relations is
not an attempt to punish our former combatants. Let me say that
again: VVA's views on United States-Vietnamese trade relations
is not an attempt to punish our former combatants. Rather, we
believe this is the best way to maintain the strategic U.S.
negotiating position on POW-MIA information.
VVA demonstrates our commitment to the full resolution of
American POW-MIA cases, as well as to hear mandatory assistance
through our veterans' initiative project. This program is
designed to compliment existing government-to-government effort
with direct veteran-to-veteran exchange of information. My
written statement details the measurable results which we have
seen from this project.
VVA believes very firmly that the number of United States
decisions in recent years relating to the normalization of
relations with Vietnam are premature and that we disagree with
the President's determination to waive the Jackson-Vanik
amendment for Vietnam which will open the door to future trade
enhancements.
The President's waiver of Jackson-Vanik relating to Vietnam
came 1 day after his March 4 declaration that Vietnam is fully
cooperating in good faith with the United States POW-MIA
accounting efforts. President Clinton's assessment of United
States-Vietnam cooperation and its subsequent March 10 waiver
of Jackson-Vanik was premature without considering the results
of the Special National Intelligence Estimate.
The SNIE published within DOD on May 22 in classified form
is supposed to measure whether Vietnam is meeting United States
intelligence expectations on the disclosure of information of
POWs or MIAs, or repatriation of remains from the Vietnam war.
VVA firmly believes that the SNIE must be declassified and
fully assessed before the United States make trade policy
decisions based upon the Vietnamese cooperation. To proceed
with the Jackson-Vanik waiver without all available
intelligence information contained in this SNIE does not serve
the best interest of the commission and their families.
Attached to my written statement is a copy of VVA's most
recent convention resolution on this topic. I draw your
attention to this resolution. It categorically set forth the
current VVA's position on the issue of Vietnam war POW-MIAs in
Southeast Asia. VVA has constantly stated over the past decade
that without fullest possible accounting, the Vietnam war,
America's longest, is not over.
We acknowledge that the Vietnamese--we acknowledge that
Vietnam has made some serious efforts to assist our government
in achieving the fullest possible accounting for our missing,
and we're proud of the contribution our organization has made
to this effort through the Veterans' Initiative. Nevertheless,
we must earnestly believe that the Vietnamese Government can
and must do more.
We have endorsed H.R. resolution 120 and S.J. resolution
47, and we strongly urge the Subcommittee and the entire
Congress to pass this legislation in order to nullify the
President's waiver of Jackson-Vanik for Vietnam. VVA believes
that the continuation of the Jackson-Vanik waiver at this time,
without thorough analysis of the recently completed SNIE,
demonstrates that the administration has lost sight of the--
prioritization of the fullest possible accounting has been
abandoned. This commitment to veterans and the POW family.
We depend then upon Congress to review our Nation's focus
on this issue--to renew our Nation's focus on this issue.
This concludes VVA's statement. I would be happy to provide
any additional information the Subcommittee may desire. Thank
you very much.
[The prepared statement follows:]
Statement of George C. Duggins, National President, Vietnam Veterans of
America
Introduction
Mr. Chairman and members of the Committee, Vietnam Veterans
of America appreciates the opportunity to present its views on
the current status of trade relations between the United States
and the Socialist Republic of Vietnam. As the Congress
considers the President's waiver of the Jackson-Vanik amendment
to the Trade Act of 1974 with relation to Vietnam, it is very
important that our nation's long-standing commitment to
achieving the fullest possible accounting of American POW/MIAs
from the Vietnam War be maintained.
Vietnam Veterans of America (VVA) is the only
Congressionally chartered national Vietnam veterans
organization exclusively dedicated to Vietnam-era veterans and
their families and supporters. As you would expect, the issue
of U.S.-Vietnam trade relations is one of great seriousness and
concern to VVA. VVA is adamantly opposed to the further
normalization of trade relations with Vietnam at this time and
we urge Congress to disapprove the President's waiver
determination. Our members have expressed the strong belief
that additional steps toward normalization are premature until
the Vietnamese government demonstrates improved unilateral
efforts to assist the U.S. with accounting of POW/MIAs.
VVA also recognizes that Jackson-Vanik deals with human
rights and freedom of emigration issues. While these are very
important matters for the Congress to consider, these are
issues outside of the purview of our organizational mandates.
Therefore, I will limit my remarks exclusively to Jackson-Vanik
and POW/MIA accounting. VVA strongly feels that this measure of
the 1974 Trade Act is a tool available to the U.S. government
in seeking cooperation from the Vietnamese on the POW/MIA
issue. It is for that reason that we are presenting this
statement for your consideration.
The Fullest Possible Accounting
VVA has consistently taken the strongest stands on
demanding that the President of the United States continue to
press the Vietnamese government, as a matter of highest
priority, for the fullest possible accounting of POW/MIAs lost
in the Vietnam War, utilizing both joint and unilateral
activities. Specifically, we have called for the highest
priority of effort to be focused on the accounting for:
1. Any American POW/MIAs who may still be alive in
Southeast Asia and held against their will; and
2. Those last known alive or known to have died in
captivity.
Needless to say, VVA also believes that the accounting for
and return of the remains of American soldiers believed to have
been killed in action without their bodies being recovered must
also be treated as a priority matter and aggressively pursued.
Accordingly, in recent years VVA strongly opposed a number
of decisions it thought were premature relating to the
normalization of relations with Vietnam, including lifting the
trade embargo, opening an embassy in that country and
appointment of a U.S. ambassador. Most recently, VVA's National
Convention in Kansas City, Missouri adopted Resolution PM-11-97
[a copy of which is attached for the Committee's review and
information]. National Convention resolutions mandate VVA's
policy and positions on a wide range of issues. This resolution
categorically sets forth the current VVA position on the issue
of Vietnam War POW/MIAs in Southeast Asia and concludes with
the words: ``With respect to OPIC, MFN status, and other steps
toward normalization of relations with Vietnam, VVA most
strongly urges the President to defer decisions until the
Vietnamese Government has demonstrated measurably increased
unilateral efforts that yield concrete results in terms of
accounting for American POW/MIAs. Moreover, VVA urges the
President to hold to his commitment to the major veterans
service organizations and the National League of Families of
American Prisoners and Missing in Southeast Asia to seek their
input to considering such decisions.''
VVA has consistently stated for the past decade that
without the fullest possible accounting, the Vietnam War,
America's longest, is not over. We acknowledge that Vietnam has
made some serious efforts to assist our government in achieving
the fullest possible accounting for our Southeast Asia POW/
MIAs. Nonetheless, we still earnestly believe that the
Vietnamese government can, and must, do more.
VVA has already endorsed H.R. 3159, sponsored by Rep.
Edward Royce, which would provide that the President may not
waive the provisions of title IV of the Trade Act of 1974 with
respect to the Socialist Republic of Vietnam. And today, we
declare our strong support and endorsement for H.J. Res. 120
and S.J. Res 47. VVA is adamant that President Clinton's March
10th waiver of the Jackson-Vanik Amendment of the Trade Reform
Act of 1974 was premature, as was his June 3rd decision to
extend the waiver. Passage of this legislation is necessary to
nullify this action.
The President's waiver of Jackson-Vanik relating to Vietnam
came only days after his March 4th declaration that Vietnam is
``fully cooperating in good faith'' with U.S. efforts to
account for missing American soldiers from the Vietnam War. The
1974 Trade Act bars the U.S. government from giving trade and
investment funding to non-market economy nations unless the
President certifies compliance with human rights and free
emigrations. With the Socialist Republic of Vietnam, the
amendment also contains very specific requirements of
cooperation toward the accounting of U.S. personnel missing
from the Vietnam War. Waiver of Jackson-Vanik removes the major
obstacles to full economic and trade relations with Vietnam.
President Clinton's assessment of Vietnam's cooperation,
and the March 10th waiver of Jackson-Vanik was premature
without the result of the Special National Intelligence
Estimate (SNIE). The SNIE, published within DOD on May 22nd in
classified form, is supposed to measure whether Vietnam is
meeting U.S. intelligence expectations on the disclosure of
information, or remains associated with captured and missing
American servicemen from the Vietnam War. VVA firmly believes
that the SNIE must be declassified and fully assessed before
the United States makes trade policy decisions based upon
Vietnamese cooperation. To proceed with the Jackson-Vanik
waiver without all available intelligence information contained
in the SNIE does not serve the best interest of the missing and
their families.
VVA believes that the President's action to continue the
Jackson-Vanik waiver at this time without thorough analysis of
the recently completed SNIE demonstrates that the
Administration has lost sight of the prioritization of the
fullest possible accounting and has abandoned this commitment
to the veterans service organizations and POW/MIA families. We
must depend upon Congress, then, to ensure that progress on
American POW/MIA accounting is measured appropriately based
upon the following criteria:
Concrete results from efforts on Vietnam's part to
recover and repatriate American remains;
Continued resolution of remaining discrepancy
cases, live sightings and field activities;
Further assistance in implementing trilateral
investigation with Laos; and
Accelerated efforts to provide all POW/MIA related
documents that will help lead to genuine answers.
The VVA Veterans Initiative
To demonstrate that VVA is serious in its efforts to seek
the fullest possible accounting, allow me to convey to this
Subcommittee some information about another VVA endeavor which
is innovative and realistic. VVA's Veterans Initiative promotes
a direct veteran-to-veteran exchange of information on
unaccounted-for American servicemen and Vietnamese war
casualties. This program is designed to complement existing
government-to-government efforts, and has produced measurable
results toward the achievement of the fullest possible
accounting on both sides.
The Veterans Initiative is a humanitarian effort which
demonstrates VVA members' commitment not only to fostering
resolution of American POW/MIA cases, but also attempts to help
Vietnamese families achieve closure for their missing loved
ones. We presently have a delegation in Vietnam and they have
been told by the Vietnamese Ministry of Defense that VVA has
helped to locate remains to account for 811 Vietnamese war
casualties. According to Vietnamese government officials, we
have provided them with information on approximately 8,000 of
their missing. This program demonstrates that VVA's view on
U.S.-Vietnamese trade relations is not an attempt to punish our
former combatants, but rather is our belief about the best way
to maintain the strategic U.S. negotiating position.
In turn, the Veterans Initiative, working through our
counterpart organization the Vietnamese Veterans Association,
has been able to obtain information on previously unknown crash
sites, grave sites, the recovery of remains, and has been
invaluable in assisting the U.S. Oral History Program in
obtaining information which otherwise would be lost. Ambassador
Pete Peterson has said of the VVA Veterans Initiative, ``I
believe that private individuals may hold the keys to answering
the questions as to the fates of missing Americans. Any program
that helps bring a fuller accounting of our missing servicemen
is worthy.'' VVA is proud of our work to resolve the cases of
the remaining American POW/MIAs.
No Further Normalization Steps at This Time
We must also emphatically underscore that VVA remains
adamantly opposed to the approval of any additional steps
toward the normalization of relations with Vietnam because of
the lack of the fullest possible accounting for our POW/MIAs to
date.
Specifically, we will not support, directly or indirectly,
any efforts or decisions at this time that would extend to
Vietnam either Overseas Private Investment Corporation (OPIC)
eligibility or Most Favored Nation (MFN) status.
The United States and Ambassador Pete Peterson must have
significant leverage in evaluating whether or not Vietnam is
fully cooperating with our government's POW/MIA efforts and
whether/when the fullest possible accounting has, in fact,
taken place.
Conclusion
Vietnam Veterans of America remains strongly opposed to the
President's waiver of the Jackson-Vanik amendment for Vietnam
and any further trade normalization steps. Our government must
not breach faith with those POW/MIAs or their families. VVA has
led the fight for the fullest possible accounting for twenty
years. We shall continue to do so. We take great pride in our
POW/MIA record and our more recent accomplishments through the
VVA Veterans Initiative.
VVA urges this Subcommittee and the full House Committee on
Ways and Means to pass H.J. Res. 120 without delay, and present
the legislation to the full House for consideration. We
strongly recommend that Congress demand declassification of the
SNIE and assess this document fully prior to approving further
advancements in U.S.-Vietnam trade. It is important that
Congress not allow our nation's POW/MIAs and their families to
be forsaken in the Administration's urgency to expand U.S.-
Vietnamese trade.
Vietnam Veterans of America would be happy to provide any
additional information the Committee may desire. This concludes
our statement.
FULLEST POSSIBLE ACCOUNTING OF POW/MIAS IN VIETNAM (PM-10-97)
Issue:
Vietnam Veterans of America, Inc., has a long-established
position opposing further normalization of diplomatic and
economic relations between the United States and Vietnam until
the fullest possible accounting of POW/MIAs lost in the Vietnam
War has been achieved.
Background:
At every opportunity, VVA has urged the United States
government to continue to press the Vietnamese government to
increase its unilateral efforts and to demonstrate greater
cooperation by facilitating follow-up of live sighting reports,
expanding its participation in joint remains recovery efforts,
opening its wartime archives, and helping to locate Vietnamese
citizens and soldiers who witnessed incidents of loss.
Since the establishment of the Joint Task Force Full
Accounting (JTF-FA) in early 1992, U.S. officials directly
involved with the accounting process have claimed that the
Vietnamese government has recently demonstrated increased
cooperation in resolving the fate of American POW/MIAs and that
American field investigators have been able to follow up live
sighting reports with very little prior clearance by local
Vietnamese officials, and that the number of joint remains
recovery teams operating throughout Vietnam has increased.
Despite U.S. government claims, American specialists have
been given only limited access to Vietnamese national and local
wartime archives and to witnesses of incidents of loss. Vietnam
has provided alleged witnesses for trilateral investigations
with American and Lao teams in those areas of Laos controlled
during the war by Vietnamese armed forces; however, Vietnam has
not yet provided relevant documents to help resolve such cases.
U.S. government officials attribute Vietnam's increased
cooperation for joint activities to the lifting of the trade
embargo in February 1994 and the agreement to open embassies in
Washington and Hanoi. Even these U.S. government officials,
however, have reported that the Vietnamese government has not
been fully candid about information it is believed to have on
MIAs last known to be alive and those who died in captivity, as
well as other discrepancy cases.
On July 11, 1997, despite the opposition of VVA and other
veterans and family organizations, President Clinton announced
the establishment of diplomatic relations with Vietnam. On May
9, 1997, this decision resulted in the opening of an American
embassy in Hanoi and Vietnam's embassy in Washington, D.C.
There are, however, further steps in the ``normalization''
process that have not yet been taken, such as extending
Overseas Private Investment Corporation (OPIC) insurance, which
safeguards private investments in foreign countries, and Most
Favored Nation (MFN) status, which greatly reduces tariffs on
goods imported from MFN countries.
This resolution amends Resolution PM-11-95.
Resolve that:
Vietnam Veterans of America, Inc., at National Convention
in Kansas City, Missouri, August 5-10, 1997, strongly urges
that:
1. The President of the United States continue, as a matter
of highest priority, to press the Vietnamese Government for the
fullest possible accounting of POW/MIAs lost in the Vietnam War
through both joint and unilateral activities.
2. Priority of effort be placed on accounting for a) any
American POW/MIAs who may still be alive in Southeast Asia, and
b) those last known alive or known to have died in captivity.
3. Urges the President to measure progress on fullest
possible accounting by the four criteria established in 1994 by
the Clinton administration;
a) Concrete results from efforts on Vietnam's part to
recover and repatriate American remains;
b) Continued resolution of remaining discrepancy cases,
live sightings, and field activities;
c) Further assistance in implementing trilateral
investigation with Laos; and
d) Accelerated efforts to provide all POW/MIA related
documents that will help lead to genuine answers.
VVA endorses the definition of ``fullest possible
accounting'' that has been accepted by the major veterans
service organizations and the National League of Families of
American Prisoners and Missing in Southeast Asia: namely, the
repatriation of a live American POW/MIA, the return of his
remains, or compelling evidence why neither of these is
possible. VVA affirms that the impact of our position on this
issue is strengthened when we are able to work cooperatively
with these other organizations.
With respect to OPIC, MFN status, and other steps toward
normalization of relations with Vietnam, VVA most strongly
urges the President to defer decisions until the Vietnamese
Government has demonstrated measurably increased unilateral
efforts that yield concrete results in terms of accounting for
American POW/MIAs. Moreover, VVA urges the President to hold to
his commitment to the major veterans service organizations and
the National League of Families of American Prisoners and
Missing in Southeast Asia to seek their input prior to
considering such decisions.
Chairman Crane. Thank you, Mr. Duggins.
Mr. Burch.
STATEMENT OF J. THOMAS BURCH, JR., CHAIRMAN, NATIONAL VIETNAM &
GULF WAR VETERANS COALITION
Mr. Burch. Mr. Chairman, I'm Tom Burch, chairman of the
National Vietnam & Gulf War Veterans Coalition. This is the
first time we've had an opportunity to appear before the House
Ways and Means Committee, and we are grateful that you give us
this opportunity to put our views forward on this very
important issue of the waiver of the Jackson-Vanik amendment.
We want the House of Representatives to overturn the
President's waiver and we--our 95 member groups with our
combined membership of 350,000 join in that request with
Vietnam Veterans of America.
We also, in our organization, maintain very close ties to
the Vietnamese exile organizations. We organized for advocacy
on 10 issues of particular concern to veterans of these two
wars. One of these issues is full accountability for prisoners
of war and missing in action.
Given the sorry record of the Socialist Republic of Vietnam
on POW-MIA accountability, any issue should be raised, any road
should be explored, that can used to pressure or leverage
Vietnam. The Jackson-Vanik amendment is such a mechanism.
It is a self-evident proposition that Vietnam is not a
country which permits free emigration. There are significant
roadblocks placed in the way of those desiring to leave the
country for reasons of conscience or to pursue better
opportunities, which has produced the unrivaled phenomenon of
the boat people.
Even the Orderly Departure Program, the most recent
resettlement opportunity for Vietnamese returnees, had been
tainted by significant corruption. We understand from our
Vietnamese sources that bagmen acting on behalf of the
Communist regime have traveled the world to conduct shakedowns
of these emigres whose in-country relatives desire to be placed
on the waiting list for legal emigration.
As the boat people have stated in a recent letter,
Vietnam's recent changes in the resettlement opportunity for
Vietnamese returnees program only delays the requirement for
exit permission. There's also mounting evidence that local
authorities have invented many different ways other than the
denial of exit permission to block access to the resettlement
opportunity program. Since 1995, more political dissidents and
religious leaders have been imprisoned. Freedom of the press
has been much more severely curtailed than before.
More recent events bear these contentions out. In the last
3 months leading up to the President's waiver, 14,000
individuals were cleared under the resettlement opportunity
program. In the subsequent 3 months, a mere 150 have been
cleared.
The lesson is clear. There's no basis for concluding that
Vietnam is complying with the Jackson-Vanik amendment. Any
waiver thereof would have to be based on some extraneous
benefit. But what is that benefit?
The waiver will enable corporations desiring to do business
in Vietnam access to credits and guarantees principally funded
throughout the Overseas Private Investment Corp. and the
Export-Import Bank. This access can only hurt the American
taxpayer. The combination of red tape and corruption in the
Socialist Republic of Vietnam has rendered foreign investment
ineffective.
Chrysler is the most conspicuous recent example of the
failure of the investment policy. After making an investment of
over $60 million, they had to withdraw because of failed
opportunities with the Vietnamese.
Last, a resolution of the POW-MIA accounting issues for so
many of our veteran constituencies is long overdue. Since we
anticipate that other witnesses have addressed Hanoi's history
of noncompliance in meticulous detail, we will confine
ourselves to this point: As the perception of business
opportunities mounted over the last decade, there's been a
campaign to deny the reality of living prisoners of war still
in captivity.
Remember particularly when President Clinton lifted the
embargo that one of the particular documents that we felt would
come out of that is something called the ``blue file.'' This is
known to be out there. It's been testified to many times
before. This was a promise that we have received because it was
very sensitive after lifting the embargo, and we have never
received it. Because of the sensitivity admitting these
occurrences, the files could not be produced at the time, but
they still haven't been produced.
I'd like to take a couple more minutes of my remaining time
to comment on a couple things Ambassador Peterson said, and we
all recognize him to be a great gentleman and patriot, but I
take exception to one thing he said. He said that they had been
getting pretty good access in Vietnam.
I met with Ambassador Peterson before he went over there
and I gave him three live-sightings reports of a specific
military prison, underground, 85 miles northwest of Hanoi. And
said: ``you know, sir, the only thing I'm asking you to do is
to visit that prison complex. Just do that one,'' and, because
we thought that was the best location we could ascertain. After
all, we used to deal with intelligence, I'm a former Green
Beret. We know what we're talking about. Check that site.
I asked him before he testified today, had he been to that
site. He said, no, they won't let me in there. They'll let me
into the other sites. I said, sir, that's the one we want you
to go to. And until they do that, we want to make sure that
there are no living Americans.
Last, about the reform government. The reform government's
not in power. That's Do Moi's government in power. The reform
people tell us that they can't resolve the live POW issue
because every time they start getting some leverage on the
Communist regime, which has to get results, our government
eases up on the trade, gives them the money, gives them
diplomatic recognition, and it makes their government
successful in the face-saving category.
The reformers feel that if we would hold the line, it would
give them a stronger hand to get free trade and get these
credits because they could deliver that, and with that they
will deliver the live POWs that they tell us are still being
held in captivity. That we need this as a point of leverage, I
agree with my colleague from Vietnam Veterans of America. We're
not angry because of the war, but we want the live people that
we believe to be over there, some in Vietnam, some in Laos,
returned to us.
Thank you for the opportunity to express our views, Mr.
Chairman. There is no merit to the contention that the Jackson-
Vanik provision should be waived. We believe that H.R. 3159 is
the correct approach. We strongly urge it's passage. Thank you,
Mr. Chairman.
[The prepared statement follows:]
Statement of J. Thomas Burch, Jr., Chairman, National Vietnam & Gulf
War Veterans Coalition
Mr. Chairman, we thank you for the opportunity to appear
before this Subcommittee, the first time we have appeared
before this Committee in our 15-year history.
The National Vietnam & Gulf War Veterans Coalition is a
federation of 95 Vietnam and Gulf War veterans organizations
and issue groups, with an estimated combined underlying
membership of 350,000. We also maintain close ties to
Vietnamese exile organizations. We are organized for advocacy
on ten issues of particular concern to veterans of these two
wars. One of these issues is full accountability for prisoners
of war and missing in action.
Given the sorry record of the Socialist Republic of Vietnam
on POW-MIA accountability, any issue should be raised, any road
should be explored, that can be used to pressure or leverage
Vietnam. The Jackson-Vanik Act is such a mechanism.
It is a self-evident proposition that Vietnam is not a
country which is permitting free emigration. There are
significant roadblocks placed in the way of those desiring to
leave the country for reasons of conscience or to pursue better
opportunities, which has given rise to the unrivaled phenomenon
of the boat people. Even the Orderly Departure Program and the
more recent Resettlement Opportunity for Vietnamese Returnees
have been tainted by significant corruption; we understand from
our Vietnamese sources that bagmen acting on behalf of the
Communist regime have traveled the world to conduct shakedowns
of those emigres whose in-country relatives desire to be placed
on the waiting lists for legal emigration. Dr. Nguyen Dinh
Thang, of Boat People S.O.S., circulated a letter on January
which points out:
``Vietnam's recent changes in the Resettlement Opportunity
for Vietnamese Returnees (ROVR) only delays the requirement for
exit permission.... There is also mounting evidence that local
authorities have invented many different ways other than the
denial of exit permission to block access to RVOR....
``... [M]any eligible applicants under the general Orderly
Departure Program (ODP) are also facing problems with exit
permission. They include former political prisoners, former
U.S. employees, religious leaders, dissidents, immediate
relatives of U.S. citizens, etc....
``... [Since] 1995 [, m]ore political dissidents and
religious leaders have been imprisoned. Freedom of the press
has been much more severely curtailed than before.''
More recent events bear these contentions out. In the three
months leading up to the President's waiver, 14,000 individuals
were cleared under ROVR. In the subsequent three months, a mere
150 have been cleared.
The lesson is clear. There is no basis for concluding that
Vietnam is complying with the Jackson-Vanik Act. Any waiver
thereof would have to be based on some extraneous benefit. But
what is that benefit?
The waiver will enable corporations desiring to do business
in Vietnam access to credits and guarantees principally funded
through the Overseas Private Investment Corporation and the
Export-Import Bank. This access can only hurt the American
taxpayer. The combination of red tape and corruption in the
Socialist Republic of Vietnam has rendered foreign investment
ineffective. CitiBank and Chrysler are the most conspicuous
examples of American companies that have already ceased to do
business in Vietnam. Nor have these failures been confined to
American companies; the most spectacular failure was that of a
French company named TOTAL, which abandoned a $60 million
investment in an oil refinery, rather than relocate it to a
port which could not accommodate oil tankers but could supply
jobs to relatives of the cadres ordering the switch. Mr.
Chairman, the American people should not be paying through
their taxes for future failures of these types, when corporate
business interests, always eager for the next deal and
protected by a safety net which ignores the discipline of the
market, positions themselves in an economic Dienbienphu.
Lastly, a resolution of the POW-MIA accounting issue that
troubles so many of our veteran constituency is long overdue.
Since we anticipate that other witnesses will address Hanoi's
history of non-compliance in meticulous detail (as they were
also addressed in yesterday's hearing before the House
Committee on International Relations), we will confine
ourselves to one point. As the perception of business
opportunities has mounted over the past decade, there has been
a campaign to deny the reality of living prisoners of war still
in captivity. One of the centerpieces of this campaign was the
publication of Malcolm McConnell's Inside Hanoi's Secret
Archives, a credible, but flawed, book on the issue. The author
was apparently utilized as a conduit for a story line that all
`discrepancy case' MIAs who had not died from combat-related
causes had been executed and that the proof of this explanation
was contained in so-called `blue files,' which were maintained
on each POW-MIA about whom the Vietnamese authorities have
knowledge. Because of the sensitivity of admitting to these
occurrences, the files could not be produced until diplomatic
recognition had been accorded, so the story line went. We have
now had diplomatic recognition for more than a year. Where are
the blue files?
Mr. Chairman, there is no merit to the contention that the
Jackson-Vanik Act provisions should be waived. H.R. 3159 is the
correct approach. We strongly urge its passage. Thank you.
Mr. Burch. One last thing, Mr. Chairman, one of our groups,
the Rolling Thunder, didn't have an opportunity to testify, and
they wanted to have the statement added to the record.
Chairman Crane. Without objection, so ordered.
Mr. Duggins. The statement of Mr. Richard Will.
[The prepared statement follows:]
Richard F. Will, Sr.
Westminster, MD 21157
June 18, 1997
To: Honorable Philip Crane and Members of the Committee
Ladies and Gentlemen,
My Name is Richard F. Will Sr. and I am a Vietnam Veteran, having
served in Pleiku, South Vietnam from July of 1964 to July of 1965. I am
grateful for the chance, today, to address this Committee, regarding
the Presidents recent waiver of the Jackson/Vanik Amendment. And, I
wish to thank you for that opportunity!
I am a member of the following VSO's, though I am not formally
here, representing either: Life Member of VFW, Member of the American
Legion, Member of the Vietnam Veterans of America, Member of Veterans
of the Vietnam War, Member of In Country Vietnam Veterans, Member of
ALVETS, and a Member of National Vietnam Veterans/Gulf War Coalition. I
am also a Member of the Co-Montagnard Association, the Maryland Vietnam
Veterans Last Patrol, and the Alliance of Families.
However, as I go around the country, I have gathered a feel of how
a great many members of all of those above-mentioned organizations
feel, toward the Presidents Waiver. They are opposed to it! And, so am
I!
Allow me to explain why!
The Socialist Republic of Vietnam, has not even begun to warrant
such action by our Government. Hanoi has not moved positively in
addressing the question of `Humane Rights' let alone an honest full
accounting of our `Missing In Action' nor possible `Live American
POW's.'
Since 1993, I have returned to Southeast Asia three times. On those
trips I have met with and seen first hand, the oppressive actions of
the Hanoi Government. Our Montagnard Brothers and Sisters have been
isolated and refused the right to emigrate to this country. Contrary to
what might be portrayed by our State department.
In March I listened as Ms. Julia Taft (A Representative of the
State Department) gave testimony to a similar Senate Select Committee,
regarding the `Waiver' and ODP progress. At that time, I believe, she
was asked if there were any other ethnic groups (Tribal) in neighboring
Laos or Cambodia, that were experiencing the same emigration
difficulties. Her response was that she had no knowledge of any. Did
she not know of the Hmong Tribe People, the Lao Tung, the Nung?
I give this example, because it proves that the State Department
Experts are not `Experts'! But, they will do their jobs. And that job,
is to promote the Administrations premise that the Communist Vietnamese
are doing all they can, to change............... A False-Hood!
The Montagnards, to use an example, were our staunchest allies.
Their love for the Americans' was such, that they would lay down their
lives, to protect us. Even after the war, they continued the `Fight'
for freedom and democracy. As such, in the eyes of Hanoi, they are to
be continually punished.
However, there are many more religious and ethnic peoples being
treated the same, by the Hanoi Government. The Buddhists are being
imprisoned and killed, for their beliefs. The Catholics, some of which
have been relocated to lands saturated by Agent Orange, are under the
same type of oppression. To ignore these blatant Humane Rights
Violations, would be sinful.
In closing, I am opposed to such a `Waiver,' as it relates to
Hanoi's co-operation on the POW/MIA Issue. There has been no real co-
operation! The Administrations rhetoric, would imply that there is. If
you judge the statements by action, logic would say, there has not
been.
As most of you should be aware, during Operation Homecoming and
after the War, our Government knew (By our own list and that of Hanoi)
that there were over 150 PW's that were not released. By DPMO's own
admission, in the summer of 1997 at a WA BOD Meeting, possibly one set
of remains (from that category) has been returned. Once again, `Logic'
would tell us, there's not much co-operation there!
The simple fact is, Vietnam is run by an oppressive communist style
of leadership. They will lie and say anything to accomplish their
goals. Tis the nature of the beast! It is up to us (The United States),
as a Nation and a `Leader in Freedoms Fight', to judge words by action.
Likewise, this Committee and our Congressional Representatives,
will be judged by the action taken on either supporting or denying the
Jackson/Vanik Amendment Waiver. You have a choice between abandoning
`Freedoms Fight' or making a stand for Freedom, Human Rights, and
Humane Dignity.
The Choice is yours!
Thanking you for your time, I am....
Gratefully Yours,
Richard F. Will, Sr.
RFW: rfw
cc: File
Chairman Crane. Very good.
And, finally, Mr. Sommer.
STATEMENT OF JOHN F. SOMMER, JR., EXECUTIVE DIRECTOR, AMERICAN
LEGION
Mr. Sommer. Thank you, Mr. Chairman.
Chairman Crane. Perfect timing.
Mr. Sommer. On behalf of the American Legion, we want to
thank you for the opportunity to participate in today's hearing
on the President's proposed renewal of Vietnam's waiver under
the Jackson-Vanik amendment.
It's obvious to the American Legion that all Vietnamese
citizens are not by any stretch of the imagination free to
leave Vietnam if they so wish. And the Montagnards, who you
heard from earlier today, who populate the central highlands,
are even further restricted in their attempts to emigrate. And
I mention the Montagnards because the United States involved
them in the war in Vietnam, and they became loyal and dedicated
allies. Then, following the total United States withdrawal from
South Vietnam in 1975, many, if not most, of the Montagnard
held out some degree of hope that their American allies would
return to the highlands to rejoin them. As you and I know, that
was not to be.
The plight of the Montagnard today remains most
unfortunate. Millions of dollars and thousands of man-hours of
humanitarian assistance are expended in Vietnam by American
NGOs each year. However, few, if any of these organizations are
permitted by the Vietnam Government to develop and administer
programs that would provide humanitarian aid to the Montagnards
in the central highlands despite the horrendous conditions of
poverty and hopelessness that exist among the tribal people.
The failure of the Vietnamese Government to allow the
provision of humanitarian assistance in the highlands is not
the only problem facing the Montagnards. We have seen and heard
numerous reports, some anecdotal and others official, of the
strife that has beset Montagnards who have attempted to
emigrate from Vietnam. It is often reported that many have been
forced to pay province officials exorbitant fees for exit
permits, and then, in some cases, bribes to other Vietnamese
officials, in their mostly futile attempts to negotiate the
emigration process.
The situation regarding the Montagnard is concisely
described in a recent report prepared by the chief counsel of
the House International Relations Committee's Subcommittee on
International Operations and Human Rights, following his
December 1997 trip to Vietnam. The report states, in part,
``The Montagnard population, many of whose members have
particularly strong ties to the United States, and particularly
compelling refugee claims, continues to face problems that are
even worse than those of most other Vietnamese of humanitarian
interest to the United States. Because of their remote
location, and their alienation from the mainstream of
Vietnamese society, they're particularly vulnerable to all of
the abuses listed above. They have even less access to
information than other residents of Vietnam and are even more
helpless in the face of official corruption. For instance, some
Montagnard refugees resettled in the United States have been
forced by corrupt local officials to leave family members
behind and substitute nonfamily members who then disappear upon
their arrival in the United States.''
Mr. Chairman, I might add, we just found out this week of a
case that happened within the last 3 weeks, where a Montagnard
arrived in Charlotte, North Carolina, and had been forced to
adopt a ``wife'' and ``family members'' who were not his, and
bring them with him before he could get his exit visa.
With respect to specific refugee programs, the ROVR Program
was not viewed favorably by the American Legion from the
outset. Vietnam's failure to uphold its end of the bargain
until just before the Jackson-Vanik waiver by the President has
been even more disconcerting.
The purpose of ROVR was to create conditions under which
boat people would voluntarily return to Vietnam from the
refugee camps in countries of first asylum. Those who met the
United States-defined criteria of refugee and returned to
Vietnam would be interviewed, and if found eligible, be granted
passage to the United States. In turn, Vietnam agreed to not
take reprisals against them for having fled the country and to
issue exit permits necessary for them to become involved with
United States immigration officials in preparing to leave
Vietnam.
Vietnam's cooperation in furnishing the United States with
names of those who are to be interviewed has been sporadic.
According to the latest available State Department statistics,
the number of cases cleared for interview under ROVR has slowed
considerably, as compared to Vietnam clearing 14,000 names
during the 3 months immediately prior to the President's waiver
of Jackson-Vanik. This is typical Vietnamese manipulation.
It's important to note that the ROVR Program is not the
only important measure of Vietnam's cooperation on the
emigration issue. The Orderly Departure Program is equally as
important. We understand that the ODP, implemented nearly 20
years ago, potentially has nearly 95,000 applicants, and
thousands of cases that are unresolved for one reason or
another. These include cases of reeducation camps' survivors
and their widows, former U.S. Government employees, Amerasians,
and others, who are of significant importance to the United
States.
Mr. Chairman, the POW-MIA issue and the lack of unilateral
cooperation on the part of the Vietnam Government is another
concern with respect to why the American Legion believes that
the waiver of the Jackson-Vanik amendment should not be
extended, as well as the human rights violations that are
spelled out in detail in our own State Department's 1997 report
on human rights in Vietnam.
We urge the Congress to disapprove any further extension of
the Jackson-Vanik waiver until such time that Vietnam makes
significant, meaningful improvements in its emigration policies
and human rights, and unilateral cooperation on helping achieve
the fullest possible accounting of our POWs and MIAs. The
American Legion fully supports the enactment of H.J. Res. 120,
which calls for the Congress to disapprove the President's
waiver determination.
Again, Mr. Chairman, we appreciate very much your
scheduling this hearing on this most important issue today.
Thank you.
[The prepared statement follows:]
Statement of John F. Sommer, Jr., Executive Director, American Legion
Mr. Chairman and Members of the Subcommittee:
On behalf of The American Legion, thank you for the
opportunity to participate in today's hearing on the
President's proposed renewal of Vietnam's waiver under the
Jackson-Vanik amendment to the Trade Act of 1974.
In December 1997, the Clinton Administration announced that
the President was seriously considering waiving the
requirements of the Jackson-Vanik Amendment (19 U.S.C.
2432(a)). Briefly, Jackson-Vanik renders communist governments
ineligible for economic concessions through the Export-Import
Bank and the Overseas Private Investment Corporation until
their citizens are guaranteed unfettered freedom of emigration.
It is obvious to The American Legion that all Vietnamese
citizens are not by any stretch of the imagination free to
leave Vietnam if they so wish, and the Montagnards who populate
the Central Highlands are even further restricted in their
attempts to emigrate. I mention the Montagnards because the
United States involved them in the war in Vietnam, and they
became loyal and dedicated allies. Then, following the total
U.S. withdrawal from South Vietnam in 1975, many--if not most--
of the Montagnard held out some degree of hope that their
American allies would return to the Highlands to rejoin them.
That was not to be.
The plight of the Montagnard today remains most
unfortunate. Millions of dollars and thousands of man-hours of
humanitarian assistance are expended in Vietnam by American
NGOs each year. However, few--if any--of these organizations
are permitted by the Vietnamese government to develop and
administer programs that would provide humanitarian aid to the
Montagnards in the Central Highlands, despite the horrendous
conditions of poverty and hopelessness that exist among the
tribal people.
An example is the Vietnam Highlands Assistance Project
which was developed by Lutheran Family Services in 1989. During
the nine years since it was established, the project has only
been allowed access to the Central Highlands on one occasion,
though not for a lack of trying. Project officials have
continuously pushed Vietnam's Peoples Aid Coordination
Committee (PACCOM) for NGO humanitarian access to the Central
Highlands.
Of course, the failure of the Vietnamese government to
allow the provision of humanitarian assistance in the Highlands
is not the only problem facing the Montagnards. We have seen
and heard numerous reports--some anecdotal and others
official--of the strife that has beset Montagnards who have
attempted to emigrate from Vietnam. It is often reported that
many have been forced to pay province officials exorbitant fees
for exit permits, and then in some cases bribes to other
Socialist Republic of Vietnam (SRV) officials, in their mostly
futile attempts to negotiate the emigration process.
The situation regarding the Montagnard is concisely
described in a recent report prepared by the Chief Counsel of
the House International Relations Committee's Subcommittee on
International Operations and Human Rights following his
December 1997 trip to Vietnam. The report states in part:
``The Montagnard population---many of whose members have
particularly strong ties to the United States and particularly
compelling refugee claims---continues to face problems that are
even worse than those of most other Vietnamese of humanitarian
interest to the United States. Because of their remote location
and their alienation from the mainstream of Vietnamese society
they are particularly vulnerable to all of the abuses listed
above. They have even less access to information than other
residents of Viet Nam, and are even more helpless in the face
of official corruption. For instance, some Montagnard refugees
resettled in the United States have been forced by corrupt
local officials to leave family members behind and substitute
non-family members who then disappear upon their arrival in the
United States.''
Mr. Chairman, we just recently learned of a case of a
Montagnard who arrived in Charlotte, North Carolina within the
last three weeks who had been forced to accept a Vietnamese
``wife'' and ``family members'' before he could get his exit
visa. Most everyone in this room can go home to their families
at night. However, many of the Montagnards who have emigrated
to the United States have been waiting to be reunited with
their families for years.
One of the obstacles that has prevented Montagnards from
leaving Vietnam, and has also blocked the emigration attempts
of ethnic Vietnamese, has included the use of translators
provided by the SRV by our own Orderly Departure Program (ODP),
and Immigration and Naturalization Service (INS). These SRV
interpreters have been responsible for such sensitive issues as
commenting on the authenticity of documents or testimony
provided by refugee applicants during the interview process. It
is commonly known that numerous applicants whose emigration
cases were denied have complained, some in writing, to ODP
officials that they were intimidated by SRV officials being
present during their interviews, and that the presence of these
individuals encumbered their ability to openly disclose the
extent of their involvement with the U.S., relevant information
surrounding their persecution by the SRV, and related matters.
Beyond that, reports from applicants whose cases were both
approved and denied have charged that some SRV-provided
employees have solicited bribes for favorable results, and
offered threats or otherwise intimidated applicants who were
not willing to pay.
In reference to the involvement of SRV staff, the
aforementioned report by the Chief Counsel of the House
Subcommittee on International Operations and Human Rights
states in part:
``I was already familiar with what this can do to the
integrity of the refugee programs. The presence of SRV
officials at the vast majority of UNHCR interviews with CPA
returnees has been an important factor in the derision with
which the UNHCR's `zero-persecution-on-return' assurances have
been greeted by Vietnamese-Americans, U.S. veterans' groups,
Ben Gilman, Chris Smith, et al. Also, many applicants have
written letters to ODP stating that they were afraid to tell
their stories in the presence of government-supplied
interpreters, and setting forth the `real' story in an almost-
always-unsuccessful effort to get a denial reconsidered.''
It has been reported that effective January 1, 1998 a
private employment agency is being used to hire the
interpreters and others who have been furnished by SRV.
However, this has not been confirmed. It also appears that the
cases of applicants who were adversely impacted based on the
previous policy will not be re-interviewed, which is most
unfortunate.
The Resettlement Opportunities for Vietnamese Returnees
(ROVR) program was not viewed favorably by The American Legion
from the outset, and SRVs failure to hold up its end of the
bargain--until just before the Jackson-Vanik Amendment was
waived by the President--has been even more disconcerting. The
purpose of ROVR was to create conditions under which ``Boat
People'' would voluntarily return to Vietnam from the refugee
camps in countries of first asylum. Those who met the U.S.-
defined criteria of ``refugee'' and returned to Vietnam, would
be interviewed and, if found eligible, be granted passage to
the United States. In turn, SRV agreed to not take reprisals
against them for having fled the country, and to issue exit
permits necessary for them to become involved with U.S.
emigration officials in preparation of leaving Vietnam.
SRVs cooperation in furnishing the U.S. with names of those
who are to be interviewed has been sporadic. According to the
latest available State Department statistics, the number of
cases cleared for interview under ROVR has slowed considerably,
as compared to SRV clearing 14,000 names during the three
months prior to the President's waiver of Jackson-Vanik. This
is typical Vietnamese manipulation.
We understand that as of recently the exit permits are no
longer required prior to seeking interviews from ODP, but they
continue to be required at a later time during the process.
With respect to the SRV pledge of no reprisals, the previously
mentioned House Subcommittee report contains the following:
``The shocking extent of SRV involvement in the
administration of all our programs---as well as the UNHCR
monitoring program---makes highly suspect any assessment that
returnees are not facing political problems on their return.
The SRV internal security apparatus is pervasive. Maintenance
of control over the lives of ordinary citizens appears to be
among the government's highest priorities. Of the dozen or so
returnees we visited---some `officially' in the presence of SRV
personnel, others `unofficially' after satisfying ourselves
that we had managed to evade surveillance---all but three had
been denied household registration, which is the essential
prerequisite to a decent life in Vietnam. Several had been
frequently visited by security officials demanding to know
about their past political and/or religious activities and
warning them of severe reprisals for any further such
activities. All those whom the SRV government knew we intended
to visit had been interrogated in anticipation of our visit.
Several had been given detailed instructions about what to say
and what not to say. A few returnees are known to have been
imprisoned since their return---most for ostensibly
nonpolitical crimes such as illegal escape, others on overtly
political charges.''
It is important to note that ROVR is not the only measure
of Vietnam's cooperation on the emigration issue. The Orderly
Departure Program is equally as important. We understand that
the ODP, implemented nearly twenty years ago, potentially has
nearly 95,000 applicants, with thousands of cases that are
unresolved for one reason or another. These include cases of
re-education camp survivors and their widows, former U.S.
government employees, Amerasians, and others. All of them are
individuals who did not leave the country at the urging of the
U.S., based on promises that if they met the criteria, the U.S.
would process them out. It has recently been reported that
there is an artificially high ``no-show'' rate in the ODP,
generated by the fact that many people who are eligible for
interviews cannot get exit permits. Also, many who tried prior
to the first of the year were either turned away by SRV staff,
or the applicants refused to comply with the demands for
bribes.
It is interesting to note that while the clearance rate for
the politically sensitive ROVR program increased considerably
for the three months prior to the waiver of Jackson-Vanik, the
much larger ODP program languished as a result of benign
neglect on the part of the Clinton Administration.
The examples set forth in this statement are only a
snapshot of the abysmal SRV-controlled situations that exist
within ROVR and ODP--programs that were established to assist
refugees in emigrating--not forcefully prevent them from
leaving a country where they are subject to harassment and
persecution. The United States has a moral obligation to help
these individuals in any way we possibly can. Extending the
waiver of Jackson-Vanik would be the same as closing the door
forever on the possibility that many of these deserving
individuals could ever be resettled outside of Vietnam.
In addition to the provisions of Jackson-Vanik, 19 U.S.C.
2433 provides authority for the President to withhold
nondiscriminatory trade treatment to countries based on
cooperation with our efforts to account for American military
and civilian POWs and MIAs in Southeast Asia. It is contingent
upon cooperation to achieve a complete accounting of the POWs
and MIAs, to repatriate such personnel who are alive, and to
return the remains of such personnel who are dead to the United
States.
On a related issue, March 4, 1998, the President certified
that Vietnam is ``fully cooperating in good faith'' with U.S.
efforts to account for missing American soldiers from the
Vietnam war, as required under section 609 of Public Law 105-
119. The American Legion does not agree with the President's
determination. The certification would have been more credible
if he would have waited to review the National Intelligence
Estimate on the Vietnam POW/MIA issue which was released in
May, but has yet to be declassified.
The government of the Socialist Republic of Vietnam is not
cooperating anywhere near the extent to which it can. A degree
of cooperation is being offered in the conduct of joint field
activities, in which our Joint Task Force--Full Accounting and
Vietnam's Office on Seeking Missing Persons are excavating
crash sites and other incident locations. Of course, the United
States is paying Vietnam handsomely for that assistance.
It is the unilateral cooperation by the central government
that is not forthcoming. In August 1993, a high-ranking State
Department official specifically asked the Vietnamese
government to turn over remains and information relating to
over eighty cases involving over ninety individuals categorized
as Last Known Alive and Special Remains Cases. To the best of
our knowledge, very little, if any information correlating to
those cases has been turned over by the SRV government.
National Commander Anthony G. Jordan and this witness met
with several high ranking Vietnamese government officials in
December 1997, and requested, among other things, increased
unilateral cooperation in helping to resolve those cases where
the incidents took place in the areas of Laos and Cambodia that
were controlled by the Peoples Army of Vietnam during the war.
The American Legion and others, including representatives of
the families, have formally requested this as well as
unilateral cooperation on other similar issues for several
years. We continue to receive empty promises, but no
substantial progress has been forthcoming.
The third concern of The American Legion is Vietnam's
abysmal record on human rights. It is necessary to remain
mindful that the government of SRV continues to be a communist
regime that actively suppresses the human rights of many of its
citizens. Unfortunately, despite the lifting of the trade
embargo and the normalization of diplomatic relations, there
has been no appreciable improvement. The only apparent change
is the diminished level of pressure that the U.S. government is
placing on Vietnam to enhance its human rights practices. The
SRV government continues to arrest and imprison political and
religious activists and hold them at will. Hanoi does not
suffer those who believe in freedom and democracy to espouse
their feelings.
In reviewing the State Department's Human Rights Report on
Vietnam for 1997, it is interesting to note the comments that
relate to one of the issues under consideration at today's
hearing. Under the section of the report relating to the
subjects of Emigration and Repatriation is the following:
``Citizens must demonstrate eligibility to emigrate to
another country and show sponsorship abroad, before the
Government issues exit permits. Citizens' access to exit
permits was frequently constrained by factors outside the law.
Refugee and immigrant visa applications to the Orderly
Departure Program (ODP) sometimes encounter local officials who
arbitrarily delay or deny exit permits based on personal
animosities or on the official's perception an applicant does
not meet program criteria, or in order to extort a bribe.''
``There are some concerns that members of minority ethnic
groups, particularly nonethnic Vietnamese such as the
Montagnards, may not have ready access to these programs. The
government denied exit permits for certain Montagnard
applicants for emigration.''
The American Legion urged President Clinton in the
strongest possible terms to refrain from even proposing a
Jackson-Vanik waiver until considerable unilateral cooperation
and improvement are advanced by the government of Vietnam in
the three important areas that are discussed in this statement.
These issues were totally ignored, and the Administration
traded away the waiver for a bag full of empty promises from
the Vietnamese.
We now urge the Congress to disapprove any further
extension of the waiver until such time that Vietnam makes
significant meaningful improvements in its emigration policies,
human rights, and unilateral cooperation on helping achieve the
fullest possible accounting of our POWs and MIAs.
The American Legion fully supports the enactment of H.J.
Res. 120, which calls for the Congress to disapprove the
Presidents waiver determination.
Mr. Chairman, The American Legion thanks you for scheduling
today's hearing on this important issue. That completes our
statement.
Chairman Crane. Thank you, Mr. Sommer. Let me ask you all,
collectively, what, in your estimation, are the best things
that we could do to advance resolution of the POW-MIA question,
advance market institutions, democratic institutions, human
rights observance, all of the values that we believe in? What's
the best way of trying to accomplish that with Vietnam?
Mr. Sommer. Well, Mr. Chairman, what has happened,
unfortunately, during this administration, is that, beginning
with the lifting of the United States objections to economic
assistance to Vietnam in 1993, the lifting of the trade embargo
in 1994, the normalization of relations in 1996 or 1997, and
then the waiver of the Jackson-Vanik amendment, all of these
things have taken place without Vietnam making reciprocal
steps, as was the case in the process that was mentioned
earlier this morning in the roadmap that was in place some
years ago, where Vietnam would make some steps in progress, and
then the United States would take reciprocal action.
Unfortunately, we've been rewarding Vietnam without holding
them accountable for reciprocity. As far as the American Legion
is concerned, that's what needs to be done. We can't keep
throwing rewards to them without getting anything in return.
The cooperation that was mentioned several times this
morning with respect to the POW-MIA issue, for instance,
they're speaking of the cooperation of the Vietnamese Office of
Seeking Missing Personnel with our Joint Task Force Full
Accounting in crash site excavations and the investigation of
other such kinds of incidents. But what has not been brought up
is the unilateral cooperation on the part of the Vietnamese
Government that has not been forthcoming.
That is, the Vietnamese Government turning over information
that's been requested by the State Department as far back as
1993 with respect to 80-some cases involving 98 individuals
that were last-known-alive cases. This official request was
made in August 1993, and to the best of our knowledge, very
little information has been forthcoming from Vietnam on those
cases, as of today. We don't call that cooperation.
Chairman Crane. Mr. Burch.
Mr. Burch. Mr. Chairman, the Clinton administration has
made it very obvious that they want to respond to big
businesses' concerns about entering that country, and the POW
issue is an impediment, so what they have is a failed strategy
of digging up crash sites and using statistics about the number
of bones that they're returning, remains they're returning, as
a showing of progress. This is a failed strategy, as we as a
Vietnam veteran's movement want them to follow up on all these
live-sighting reports.
There are numerous live-sighting reports in the last 2
years. They give them very little priority. They rarely go out
to investigate them. When they get ready to interview
witnesses, they come forward to give the Vietnamese their names
first, and, of course, that dries up the source of information.
Like the example we gave you of the military prison
complex, which we thought was the best, defined by coordinates,
prison that we had. And he said, we didn't go to that one. Why
don't they go to the live prison sites or where these people
are supposed to be, instead of digging up crash sites from 20
years ago?
It's a failed policy, but we believe they don't want to
deal with that tougher one, that they want to show they've got
the numbers by how many remains are returned. First, our
government has got to change its emphasis to go and check out
the live-sighting reports and try to find these people, and let
the Vietnamese know we want to find them, be they deserters or
stay-behinds or whatever they are. If it's anybody live over
there that's unaccounted for, whether he wants to come home or
not, they ought to get that answer first.
And then once we as a government show that's our interest,
then, I think, they'll respond because they need this trade
thing. Now we've lost our biggest leverage point when we
recognized them, so all we have left, unless we want to give
them billions of dollars worth of war reconstruction aid, are
these economic things, such as the economic guarantees for
American investors, or most-favored-nation status. And, so, we
want to withhold those things until--so we have some piece of
leverage, otherwise they would have no way to ever--there is no
reason in the world to let it be known they were holding these
people because of all the progress that they made could be
reversed because they would, of course, not be humanitarians.
We have to change our policy. We have to let this
administration know that there's not going to be more--any
further relaxation as far as Congress is concerned. Until they
change their emphasis on live people, and once we start making
some progress on live people, then maybe we can start turning
on the spigot a bit.
Mr. Duggins. Mr. Chairman, I like to look at it in a little
different perspective. One of the things that I think, the last
time that I was in Hanoi, and I was with John, I felt, you
know, some of our values, our values are good, but some of our
values may not work for them because I felt safer in the
streets of Hanoi than I do in the streets of DC. [Laughter.]
So, maybe we ought to bring some of that here. But the
point I want to make is, I think one of the things that would
help a great deal is that our government play fair with us. You
know, we've kicked the Vietnamese around a lot here. This
report that I mentioned, this Special National Intelligence
Estimate, is supposedly telling us that the Vietnamese are
cooperating or not cooperating, has been out since May 22, and
it's still classified. And we, as activists and who are
responsible to a constituency, we have no way of telling them,
you know, we can tell them, I got a feeling. But if we had this
information from this report that is still classified, that is
sitting on somebody's desk, that was prepared by the CIA, I
think it would do a great justice to our cause to know that we
can count on our government to play fair with us as well as the
Vietnamese Government.
Chairman Crane. Mr. Harder.
Mr. Harder. Well, first question is, what can we do to try
to improve our ability to get information about the POW-MIAs. I
think the only answer to that is to stay engaged with the
Vietnamese in a dialog about the information that we have, keep
pressing them on the cases where we know we had last-known-live
sightings, our priority cases where we know the people were
alive on the ground, and to try to get definite answers on
those. If we have any specific evidence that--of live
sightings, we should be allowed to go there and check those
out.
I asked a question when we were in Vietnam in March 1998. I
asked Joint Task Force Full Accounting Detachment II, which is
there in Hanoi, what do you do when you get one of these live-
sighting reports, and I was told that, by the Detachment
commander, that they investigate each and every one of those
until they get the information resolved. And when I was there
at that time, he told me there were no cases that had not been
investigated yet. And I asked the specific question.
On the second issue, dealing with the trade policies and
how best can we get the Vietnamese to develop in a way that's
favorable--a free-market economy, which kind of goes along with
the democratic process, I don't see a way of doing that other
than getting more Americans involved in Vietnam, getting them
to understand the process of how a free-market economy works.
So, therefore, I don't see that backing off and reinstituting
some sort of an embargo or lessening trade and breaking off
relations with them, gets us very far in that regard.
Chairman Crane. Yes, Mr. Burch.
Mr. Burch. I'm sorry, sir, I just want--this is my
opportunity to make one last comment. Unfortunately, you have a
problem by what you mean by live-sighting investigations. I
recently talked to the DPMO office about this, and in most
cases, it's just someone sitting behind a desk reviewing the
papers and making a decision, whether they think it's valid or
not. It's not going out in the field and interviewing people.
That's the problem; they're not aggressive to really try to
pursue the matter.
Chairman Crane. Well, I thank you all for you testimony and
appreciate your input, and please keep the flow of information
going with us. And, with that, let me call up our last panel,
and that is Diem Hoang Do with the Coalition Against Jackson-
Vanik Waiver, and Filong Levan, vice president, Vietnamese-
American Voters' Coalition, and Joel Joseph, chairman, Made in
the USA Foundation.
And if you gentlemen will try and keep your presentation,
your oral presentations to 5 minutes, please do so. And any
written statements or documents that you may have that you'd
like to submit will be made a part of the permanent record.
And we'll start with Mr. Do.
STATEMENT OF DIEM HOANG DO, COCHAIR, COALITION AGAINST JACKSON-
VANIK WAIVER, WESTMINSTER, CALIFORNIA
Mr. Do. Thank you, Mr. Chairman. Let me start by saying
that this is not a discussion about whether or not we should
have trade with Vietnam. It is the question of under what
circumstances and with what conditions should we have trade
with Vietnam. I believe that with Vietnam, the road to free
trade should not be a toll-free highway, but we should exchange
trade benefits with Vietnam in return for concrete economic and
political reforms.
Second, I want to state that the Vietnam-American
communities here in America believe that extending the Jackson-
Vanik waiver and Ex-Im and OPIC benefits to Vietnam now are
premature and shortsighted. And I do have a letter here from 30
Vietnam-American communities from across the United States
asking for support for H.J.R. 120 and disapproving the
extension of Jackson-Vanik waiver, and I would like to submit
that letter, if I may.
Chairman Crane. All right. Without objection, so ordered.
[No information had been received at the time of printing.]
Mr. Do. Thank you.
As of last year, Vietnam estimated that around 60 percent
of foreign invested firms were yet to break even. Companies
such as Coca-Cola and Proctor & Gamble lost money, and Chrysler
pulled out altogether. This is because many obstacles exist in
Vietnam such as:
Corruption: This is a severe and pervasive problem that can
be found in all levels of government.
Absence of the rule of law: The reason that corruption in
Vietnam is so rampant is because the rule of law does not
exist.
State-owned enterprises: These enterprises enjoy subsidies
from the Vietnamese Government and other numerous advantages
over the private sector. Such preferential treatment eliminates
the level playingfield and does not allow the private sector to
effectively compete against them.
Half-hearted reform: The government only commits to reform
when it means that they still retain power. Currently, a $500
million package of loans, largely funded by IMF and the World
Bank, remains on hold because Vietnamese officials refused to
accept more comprehensive reforms.
The lack of respect for basic human rights: Limitations on
certain rights, such as freedom of the press, can have an
adverse effect on the economy because it hinders the flow of
information necessary for business activities.
Increasing social unrest: Vietnam's economic reform has
resulted in huge inequity in socioeconomic development. The
result of this situation is increasing social unrest. Since
December 1996, there has been numerous and unprecedented large-
scale protests throughout Vietnam.
To summarize the business climate and obstacles facing
foreign investors in Vietnam, let me quote Mr. James Rockwell
of Vatico, Inc., the first American company licensed to operate
in postwar Vietnam. After 6 years in Vietnam, Mr. Rockwell said
that he is heading home because ``he has been worn down by the
difficulty of arranging business contracts in Vietnam and the
dim prospects for making money.'' He also said that if 10
percent of foreign-invested companies in Vietnam are making a
profit, he'd be surprised.
Clearly, in order for Vietnam to escape economic crisis and
for foreign investors to succeed in Vietnam, crucial changes
are necessary, such as:
Equitisation of State-owned enterprises: International
institutions and leading economists have been calling for an
acceleration of reforms and equitisation of the state-owned
enterprises. Unfortunately, Vietnam is still reluctant and
proceeding with the equitisation process at a snail's pace.
Overhaul banking and legal systems: The entire banking and
legal systems must be overhauled completely. At the direction
of the Communist Party, Vietnam's banks have always lent money
to state-owned enterprises which operate at losses. This can
further damage the debt-ridden and capital-starved banking
sector.
Accountable government: The Vietnamese Government must be
held accountable for its own action, however, accountable
government can only be achieved if there is true popular and
democratic rule.
Civil society: A civil society where all basic human and
civil rights are respected is absolutely needed in Vietnam. In
addition, the rule of law must be established. Vietnam needs to
have a civil society to minimize social unrest and create a
more stable and constructive environment for businesses.
In short, Vietnam needs to have sociopolitical reform, as
well as economic reform. Recent events in Indonesia clearly
indicated that economic reform must be accompanied by
sociopolitical reform. For more than a decade, foreign
investors in the international community have been pouring
money into Vietnam with little success. That is because there
is no real pressure to force the Vietnamese Government toward a
more long-term and constructive path of reform.
The approach taken by the Vietnamese Government since 1986
has been more to stave off their own collapse, rather than
rescuing the country. With billions of dollars already invested
Vietnam, it is now time to take a different approach so that
long-term growth and a business-friendly environment can be
created.
Leaving it up to the Vietnamese Government's goodwill to
reform just does not work. The United States should use
economic leverages, such as the Jackson-Vanik waiver, MFN
status and other forms of preferential tariff treatment, to
exchange for concrete, verifiable steps toward the necessary
changes I just mentioned above. These benefits should only be
given when Vietnam reciprocates with measurable steps toward
full economic and political reforms.
Finally, giving Ex-Im and OPIC benefits to Vietnam now will
only put United States taxpayer dollars at risk, especially in
light of the Vietnamese Government's unwillingness to proceed
with true reform. I believe that such action together with the
Jackson-Vanik waiver, without any real, tangible concessions
from Vietnam, are premature at this point.
Thank you.
[The prepared statement follows:]
Statement of Diem Hoang Do, Cochair, Coalition Against Jackson-Vanik
Waiver, Westminster, California
Distinguished Members of Congress,
I would like to express my appreciation for the opportunity
to speak to you today on the major obstacles facing the
business community in Vietnam, and how the United States can
help to facilitate positive changes required for long term
success. Hopefully the information and assessment I provide
will serve to capture a more realistic picture of Vietnam.
That, I believe, is absolutely necessary to understand how what
happens in Vietnam can ultimately impact our trade and national
interests.
Obstacles to Overcome
Since the late 1980s when Vietnam launched ``doi moi,'' a
policy of economic reform, foreign companies have been flocking
to Vietnam hoping to take advantage of the new ``tiger
economy.'' However, more than a decade later, an estimated 60
percent of foreign invested firms have yet to break even
according to official Vietnamese figures. Companies such as
Coca-Cola and Procter & Gamble have lost money, while Chrysler
pulled out altogether. In addition, Vietnam once again is on
the verge of another major economic crisis. This is because
Vietnam's current condition presents many obstacles such as:
1. Corruption
This is a pervasive problem that can be found in all levels
of the government. Just last October, the Vietnamese editor of
Doanh Nghiep (Enterprise) magazine was arrested after a series
of articles that exposed alleged high-level corruption at the
customs department. Recently, reporter Kevin Bubel
(International Herald Tribune, 5/30/98) wrote that ``opaque
regulations and officials seeking bribes make Vietnam a rough
sell. Investors also complain they are nickel-and-dimed to
death as negotiations drag on.'' In 8/97, the Baltimore Sun
also reported that foreign companies are rethinking their
investments due to real problems such as red tape, pervasive
corruption, a sketchy and unpredictable legal system, and very
``clear signs of government hostility.''
2. Absence of the rule of law
The rule of law, or the lack of it, can have profound
impact on all aspects of society. In fact, the reason that
corruption in Vietnam is so rampant is because the rule of law
does not exist. Without the rule of law, businesses cannot
reasonably expect that they will enjoy equal protection under
the law. Just last year, American Rice company was fined 1.2
million dollars and was demanded to dissolve its venture. This
incident triggered Ambassador Peterson to send a letter to then
Prime Minister Vo Van Kiet accusing Vietnamese officials of
``arbitrary and discriminatory'' treatment.
3. State-owned enterprises (SOEs)
In a 1997 report, the United Nations Development Program
said that ``the advantages enjoyed by the SOEs, such as greater
access to land, credit and other valuable resourcesas well as
monopoly powers in some cases, are probably `crowding out' the
development of a dynamic, non-state sector.'' Such preferential
treatment eliminates a level playing field and does not allow
the private sector to effectively compete against SOEs. Despite
the special treatment, close to 70 percent of the 6,000 SOEs
are still losing money or barely surviving due to corruption
and mismanagement. As the government continues to pump hundreds
of millions of dollars into these companies to keep them
afloat, resources are drained from the treasury leaving it on
the brink of bankruptcy.
4. Half-hearted reform
For months since the beginning of the current crisis, the
government has remained paralyzed, unwilling to implement
radical economic reform that might continue high growth but
diminish its control. The government only commits to reform if
it means that they still retain power. Erik Offerdal of the IMF
said that ``what is needed now is a comprehensive package of
reforms. If they continue to do nothing, the country could go
off a cliff.'' Currently, a $500 million loan package largely
funded by the IMF and the World Bank remains on hold until
Vietnamese officials accept more comprehensive reforms. On
November 29, 1997, Singapore's Senior Minister Lee Kuan Yew
issued a blunt criticism during his visit to Hanoi. He said,
``I have spelled out to them the implications for our investors
and for all other investors, and they are killing them. This is
bad news for future investment.''
5. Lack of respect for basic rights
Basic rights of the Vietnamese people are not respected by
the government. In fact, they are blatantly violated. In the
State Department's Country Human Rights Report, Vietnam
continues to be classified as one of the worst violators. Such
policy erodes the people's trust in government, and that
distrust transpires into the economic arena making it more
difficult for the government to mobilize people and resources.
In addition, limitations on certain rights such as freedom of
the press can have an adverse effect on the economy because it
hinders the flow of information necessary for business
activities. In a report titled East Asia: From Miracle to
Crisis, the United Nations Development Program said that
``Vietnam's economy remains one of the most information-starved
in the world,'' and that ``Vietnam is in the midst of an
information crisis that needs to be urgently redressed''
6. Increasing social unrest
Vietnam's economic reform has resulted in huge inequity in
socio-economic development. According to the World Bank, half
of all Vietnamese live below the World Bank poverty standard of
$100 dollars a year. Approximately 90 percent of the poor live
in the countryside where the typical annual income hovers
around $20 dollars per person. The result of this situation is
increasing social unrest. Since December 1996, there have been
numerous and unprecedented large scale protests throughout
Vietnam. Andrew Steer of the World Bank noted that ``the
problems are very acute. Income inequality is growing rapidly
and social tensions are rising, Vietnam is at a crossroads.''
Some protesters have even turned to extreme measures. On June
11, 1998, a Vietnamese war veteran died after setting himself
on fire to protest against local corruption. This is the second
such act in less than two months.
To summarize the business climate and obstacles facing
foreign investors in Vietnam, the experience of Vatico, Inc.,
the first American company licensed to operate in postwar
Vietnam, is worth noting. After six years in Vietnam, James
Rockwell of Vatico, Inc. said that he's heading home because
``he has been worn down by the difficulty of arranging business
contracts in Vietnam and the dim prospects for making money.''
He also said that ``if 10 percent of foreign-invested companies
in the country (Vietnam) are making a profit, I'd be
surprised.'' (International Herald Tribune, 5/30/98)
Changes Needed for Success
Clearly, in order for Vietnam to escape economic crisis and
for foreign investors to succeed in Vietnam, crucial changes
are necessary such as:
1. Equitisation of SOEs
The United Nations Development Program recommended that
Vietnam must cut off aid to the ailing state enterprises and
act swiftly to bring greater transparency to financial
dealings. Leading economists have also been calling for an
acceleration of reforms and equitisation of the SOEs. This is a
much needed action to avoid bankruptcy and derailment of the
country's growth plan. Unfortunately, Vietnam is still
reluctant and proceeding with the equitisation process at a
snail's pace.
2. Overhaul banking and legal systems
The entire banking and legal systems must be overhauled
completely. At the direction of the party, Vietnam's banks have
lent money to money-losing SOEs at preferential rates, causing
further damage to the debt-ridden, capital-starved banking
sector. Currently, the country's foreign exchange reserves are
estimated to be just enough to cover 8-9 weeks worth of
imports. Financial transparency and legal reform have always
been key elements demanded by foreign investors. However, the
recent appointment of Deputy Prime Minister Nguyen Tan Dung to
the post of Central Bank Governor defies any logic. Mr. Nguyen
is a former security official who rose through the ranks to
become Deputy Minister of Interior from 1992 to 1997. He has no
training or experience in either economics, banking or finance.
3. Accountable government
The Vietnamese government must be held accountable for its
own actions. That means checks and balances must be in place so
that the three branches of government--legislative, executive,
and judiciary--are independent from each other, and most
importantly from the complete control of the Communist party.
Also, accountable government can only be achieved if there is
true popular rule. Such a government is needed to ensure that
the best course of action for the whole nation will be
selected.
4. Civil society
A civil society where all basic human and civil rights are
respected is absolutely needed. A civil society ensures
majority rule and protection of minority rights. In addition,
the rule of law must be established. These are the ingredients
critical for long term stability and development. Vietnam needs
to have a civil society to minimize social unrest and create a
more stable and constructive environment for business.
In short, Vietnam needs to have socio-political reform as
well as economic reform. One without the other will not work.
Recent events in Indonesia clearly indicate that economic
reform alone still leads to unrest and necessitates complete
socio-political reform. Reporter Jeremy Grant of the London
Financial Times wrote that given the current situation, western
analysts believe that ``although Hanoi could muddle along for
up to 12 months, nothing less than political reform will solve
the long-term problem.'' Also, according to Robert Templer of
the University of California: ``Policy making (in Vietnam) has
ground to a halt to such a degree that there's no hope of
serious economic reform without some sort of major shift in the
political system.''
Approach Toward Vietnam
Given the current political and economic conditions in
Vietnam, the United States is in a perfect position to
facilitate positive changes in Vietnam. Vietnam is facing
increasing difficulties on all fronts and therefore should be
more susceptible to pressures for changes. For more than a
decade, foreign investors and the international community have
been pouring money into Vietnam with little success. That is
because there is no real pressure to force the Vietnamese
government toward a more long term and constructive path of
reform. The approach taken by the Vietnamese government since
1986 has been more to stave off their own collapse rather than
to rescue the country.
With billions of dollars already invested in Vietnam, it's
now time to take a different approach so that long term growth
and a business friendly environment can be ensured. Leaving it
up to the Vietnamese government's goodwill to reform no longer
works. Pressures must be applied so that the right course and
the right pace of reform are taken. The United States should
use economic leverages such as the Jackson-Vanik waiver, MFN
status, other forms of preferential tariff treatment and other
benefits such as EXIM, OPIC, TDA to exchange for concrete,
verifiable steps toward the necessary changes mentioned above.
These benefits should only be given when Vietnam reciprocates
with measurable steps toward full economic and political
reforms.
Finally, giving EXIM and OPIC to Vietnam now will only put
U.S. taxpayers' dollars at risk especially in light of the
Vietnamese government's unwillingness to proceed with true
reform. I believe that such actions, together with the Jackson-
Vanik Waiver, without any real, tangible concessions from
Vietnam are premature at this point.
Conclusion
Free trade between the United States and Vietnam is
necessary for long term development and prosperity of both
countries, and even more so for Vietnam. However, I believe
that free trade does not mean at any cost and without
conditions. In the case of Vietnam, certain conditions must be
met in order for meaningful, long lasting trade relations to
develop. Free trade can only grow if the basic foundation for a
mutually beneficial relationship has been created. Such a
foundation is still missing in Vietnam.
Lastly, I believe that the guiding principle of our country
has always been cooperating and partnering with free
governments, free countries, where human rights and values are
respected. I believe that free trade should only be with free
people. After all, that's what this great nation is all about.
Chairman Crane. Thank you, Mr. Do. Mr. Levan or Levan.
Mr. Levan. Yes, sir, Levan.
Chairman Crane. Levan.
STATEMENT OF FILONG LEVAN, VICE PRESIDENT, VIETNAMESE-AMERICAN
VOTERS' COALITION, LONG BEACH, CALIFORNIA
Mr. Levan. Mr. Chairman, I would like to express my
opposition, and that of the Vietnamese-American Voter's
Coalition, to the waiver of the Jackson-Vanik amendment for
Vietnam.
The Jackson-Vanik amendment makes access to U.S. Government
credit and investment guarantees dependent on freedom of
emigration and progress in human rights. There has been little
movement in either area in recent years. In fact, the Communist
regime has, if anything, become even more repressive.
The most substantial argument for the lifting of the
Jackson-Vanik amendment has been that Vietnam no longer
requires exit permits as a precondition for access to
interviews under the United States Resettlement Opportunity for
Vietnamese Returnees Program. In reality, however, Vietnam has
not eliminated the necessity of an exit permit, but only
delayed it until after the interview.
Equally important, the human rights situation in Vietnam is
not improving. As in the past, all opposition to the ruling
Communist Party is ruthlessly suppressed and the country is
dominated by an atmosphere of repression. The Communist regime
continues to hold hundreds and probably thousands of political
prisoners. Among the prisoners are members of the Movement to
Unite the People and Build Democracy, which issued a manifesto
calling for peaceful, gradual change in Vietnam. The group
attempted to hold an international conference on democracy and
development at the Metropole Hotel in Ho Chi Minh City in
November 1993. That was to be attended by leading retired
American officials, but the meeting was prevented by the arrest
of the participants.
There are many persons who argue that the waiver of the
Jackson-Vanik amendment will promote a liberalization of
Vietnamese society. Experience suggests, however, that it is
insistence on the fulfillment of strict conditions in return
for concessions that is able to promote change. The Jackson-
Vanik amendment facilitated the emigration of Soviet Jews
because it was not lifted and the Soviet authorities,
therefore, had an incentive to change their repressive
policies.
In the Vietnamese case, the waiver of the Jackson-Vanik
amendment, would send a strong signal to the Vietnam Government
and Vietnam society encouraging the Vietnamese leaders to think
that they can continue the oppression of their own people and
still reap the benefits of advantageous trade relations with
the West.
Vietnamese communism was victorious because it deceived and
manipulated the Vietnamese people. It is for this reason that
the present Vietnamese leaders are so afraid of free emigration
and freedom of speech. Because of the regime's efficiency in
stamping out dissent, the forces of the opposition in Vietnam
are weak. But, they could become influential if political
liberty was established in Vietnam and they were allowed to
compete for power freely. This, however, will not happen
without political support from abroad.
Mr. Chairman, I therefore ask you to vote against the
waiver of the Jackson-Vanik amendment for Vietnam and to
continue to oppose it until the Vietnamese Government takes the
first steps toward allowing real political liberty, including
the removal of barriers to emigration and the freeing of all
political prisoners. Thank you for letting me voice our
concerns.
[The prepared statement follows:]
Statement of Filong Levan, Vice President, Vietnamese-American Voters'
Coalition, Long Beach, California
Mr. Chairman:
I would like to express my opposition and that of the
Vietnamese-American Voters' Coalition to the waiver of the
Jackson-Vanik amendment for Vietnam.
The Jackson-Vanik amendment makes access to U.S. government
credit and investment guarantees dependent on freedom of
emigration and, more generally, on progress in human fights but
there has been little movement in either area in recent years.
Instead, the communist regime has, if anything, become even
more repressive.
The most substantial argument for the lifting of the
Jackson-Vanik amendment has been. that Vietnam no longer
requires exit permits as a pre-condition for access to
interviews under the U.S. Resettlement Opportunity for
Vietnamese Returnees Program (ROVR.) In reality, however,
Vietnam has not eliminated the necessity of an exit permit but
only delayed it until after the interview. Access to other
programs, like the Orderly Departure Program (ODP) is
restricted, passports are issued for only a single foreign trip
and then must be reapplied for and people are not able even to
travel freely inside Vietnam.
Equally important, the human fights situation in Vietnam is
not improving. As in the past, all opposition to the ruling
communist party is ruthlessly suppressed and the country is
dominated by an atmosphere of repression. In April, 1997, the
Vietnamese government introduced a decree on adminstrative
detention (31/CP) that officially authorizes village level
Peoples' Committees and public security officials to detain
individuals without trial for from six months to two years.
This directive is intended to suppress freedom of speech
because it specifically applies to those persons deemed to have
violated the laws on national security but whose offense ``is
not serious enough to be prosecuted criminally.''
The Vietnamese government has also tightened its control of
the press. There was a national press blackout regarding mass
protests in the Thai Binh province from May to September, 1997
and in general, the Vietnamese domestic media is used as a tool
for Party propaganda and denied the freedom to develop into an
independent force. Although, high ranking communist officials
have emphasized the role of the mass media in fighting
corruption, on October 8, 1997, Nguyen Hoang Linh, the editor
of the business newspaper, ``Doanh Nghiep,'' was arrested and
charged with ``revealing state secrets'' for reporting high
level corruption within the Customs service in connection with
the purchase of boats from Ukraine.
Perhaps most important, the communist regime continues to
hold hundreds and probably thousands of political prisoners
whose only crime was their attempt to express themselves
freely. Among the prisoners are members of the ``Movement to
Unite the People and Build Democracy,'' which issued manifestos
calling for peaceful, gradual change in Vietnam. The group
attempted to hold an international conference on democracy and
development at the Metropole Hotel in Ho Chi Minh City in
November, 1993 that was to be attended by leading retired
American military and intelligence officials but the plan for
the meeting was foiled by the arrest of the participants.
The group's leader was Professor Nguyen Dinh Huy, who spent
seventeen years in 66 ``reeducation'' camps after 1975. He was
sentenced, upon his arrest in 1993, to 15 years of additional
imprisonment. Pham Tuong, Professor Huy's deputy, was sentenced
to fourteen years; Nguyen Ngoc Tan, also known by the pen name,
Pharn Thai, was sentenced to eleven years imprisonment; Dong
Tuy, a teacher, was sentenced to eleven years; Bui Kim Dinh,
was sentenced to twelve years; Nguyen Van Bien, was sentenced
to eight years imprisonment and Nguyen Van Chau was sentenced
to four years.
Other well known political prisoners in Vietnam include
Professor Doan Viet Hoat, who has now been imprisoned for
almost 19 years for writing articles concerning human rights in
a typewritten newsletter called, ``Freedom Forum.'' and Dr.
Nguyen Dan Que, an endocrinologist who was arrested on May 1,
1990 for issuing a manifesto calling on the Vietnamese
government to respect basic human rights and was sentenced to
twenty years imprisonment.
There are many persons who argue that the waiver of the
Jackson-Vanik amendment will promote the liberalization of
Vietnamese society. Experience with communist regimes, however,
suggests that exactly the opposite is the case. It is only
insistence on the fulfillment of strict conditions in return
for concessions that is able to promote change. The Jackson-
Vanik amendment played a key role in facilitating the massive
emigration of Jews from the Soviet Union because it was not
lifted and the Soviet authorities knew that it would not be
lifted until they made convincing progress in the areas of
emigration and human rights and therefore had an incentive to
change their policy.
In the Vietnamese case, the waiver of the Jackson-Vanik
amendment could only send the wrong signal to the Vietnamese
government and Vietnamese society. As the Vietnamese economy
falters, the Vietnamese leaders again face the choice between
maintaining tight internal security and introducing wider
reforms. All indications are that they have made the decision
in favor of security. The waiver of the Jackson-Vanik amendment
now can only encourage the Vietnamese leaders to think that
they can continue the oppression of their own people and still
reap the benefits of advantageous trade relations with the
West.
Vietnamese communism was victorious because it deceived and
manipulated the Vietnamese people. It is for this reason that
the present Vietnamese leaders are so afraid of free emigration
and freedom of speech. Because of their efficiency in stamping
out opposition, the forces inside the country which stand for
human rights are enfeebled. But they could become influential
if political liberty were established in Vietnam and they were
allowed to compete for power freely. This, however, will not
happen without the help of political support from abroad.
I therefore urge you to vote against the waiver of the
Jackson-Vanik amendment for Vietnam and to continue to oppose
it until the Vietnamese government takes the first steps toward
allowing real political liberty, including the removal of all
barriers to emigration and the freeing of all political
prisoners.
Chairman Crane. Thank you, Mr. Levan. And, finally, Mr.
Joseph.
STATEMENT OF JOEL D. JOSEPH, CHAIRMAN, MADE IN THE USA
FOUNDATION
Mr. Joseph. Good afternoon, Mr. Chairman, and thank you for
the opportunity to allow me to bring you the views of the Made
in the USA Foundation.
The foundation supports Congressman Rohrabacher's
resolution, H.J.R. 120, to overturn the President's waiver of
Jackson-Vanik. As Ambassador Peterson said, even if you do
overturn the waiver, it won't affect the attempts to recover
the remains of POWs and that movement.
Does trade with Vietnam hurt the United States or help the
United States? That's the key question to be answered during
these hearings. For if trade with Vietnam is harmful, we could
or should end it or change the terms of trading.
Nike, Inc., an American corporation based in Beaverton,
Oregon, is the largest exporter from Vietnam to the United
States. Nike contracts with five footwear factories in Vietnam,
all located in areas surrounding Ho Chi Minh City. Nike
controls these plants even though they are owned, actually, by
Taiwanese and South Koreans, like a plantation owner managing
slaves. Nike workers are paid subsistence wages in violation of
Vietnam law, working 65 hours a week for $10, or about 15 cents
an hour.
In addition, these plants are--have unsafe working
conditions where workers breathe toxic fumes at extremely high
levels. At one place, it was 177 times the level allowed by
law.
The overall scope with Vietnam compared with other nations
in the world is very small. During 1997, the Commerce
Department reports our exports to Vietnam were $228 million,
and our imports were $388 million. The foundation estimates
that Nike's exports from Vietnam are approximately $100 million
per year, or more than 25 percent of Vietnam's total exports to
the United States. The Commerce Department's statistics on
Vietnam trade are woefully inadequate, and the foundation was
forced to compile its own data.
Because trade with Vietnam is so small, even if we were to
cut off all trade, it would have virtually no noticeable effect
on the United States economy. That's in stark contrast to trade
with China.
On paper, Vietnam's labor and safety laws look reasonably
good. The problem is that they are not enforced, either because
of bribery, corruption or incompetence.
Nike is unique among American companies operating in
Vietnam. Most American companies, as mentioned before, Ford
Motor Co., pay better and have better working conditions than
Nike provides. However, as the largest American employer in
Vietnam, with approximately 25,000 workers, they manufacture 20
million pairs of shoes annually.
Workers in Vietnam have no freedom of speech. In fact, if
they speak while they work, they are physically beaten. That
was reported in the New York Times recently. That is how slaves
are treated.
The United States should push Vietnam to protect its
workers and encourage workplace democracy. According to the New
York Times, who relied on an Ernst and Young report, 77 percent
of the workers at one of the Nike plants suffered from
respiratory problems. That's more than three-quarters.
Toluene exposure, which causes cancer, was found to be from
6 to 177 times the legal limit at this plant where 9,200
workers are at that plant and they produce 400,000 pairs of
shoes a month.
A team of MBA students from the Tuck Business School at
Dartmouth studied Nike's operations in Vietnam and found that
the average monthly income of Nike workers in Vietnam is $32,
which is well below the legal minimum wage of from $35 to $45,
and that varies according to provincial law.
The average per capita income in Dong Nai province, where
Nike operates, was $449 in 1995 and estimated to be $700 last
year, double Nike's wages. So Nike is paying less than half the
average wages in Vietnam.
The Dong Nai department of labor reported average wages to
be $90 for state-owned companies, that this man testified
about, $60 for foreign firms in general, including most
American firms, and $50 for small Vietnam companies. Nike pays
an average of $41 a month in Dong Nai province.
Is this fair trade? Should the United States--what should
the United States do about working conditions and wages at
plants controlled by American companies?
The foundation proposes that exporters from Vietnam be
required to certify that in the manufacture of products
exported to the United States, that all Vietnam labor and
occupational safety and health laws were complied with, and,
two, certify that employees working to manufacture products
exported to the United States are paid a certain minimum wage.
We propose 25 cents an hour during 1998, rising to 35 cents an
hour, and these, of course, are a pittance compared to what
workers are paid elsewhere, and 50 cents an hour during the
year 2000.
The total current payroll for all Nike workers in Vietnam
is $10 million. In contrast, Nike spends that amount on Super
Bowl advertising every year, and pays Michael Jordan and Tiger
Woods more than the entire payroll that it pays 25,000 workers.
Thank you for the opportunity to let us provide this
testimony. We summarize by saying that we urge you to vote in
favor of Congressman Rohrabacher's H.J.R. 120.
[The prepared statement follows:]
Statement of Joel D. Joseph, Chairman, Made in the USA Foundation
Does trade with Vietnam hurt or help the United States?
That is the key question to be answered during these hearings.
For if trade with Vietnam is harmful to the United States, we
could and should either end it or change the terms of trading.
Nike, Inc., an American company based in Beaverton, Oregon,
is the largest exporter from Vietnam to the United States. Nike
contracts with five footwear factories in Vietnam, all located
in areas surrounding Ho Chi Minh City, the city formerly known
as Saigon. Nike controls these plants and the workers there
like a plantation owner managing slaves. Nike workers are
virtual slaves, paid subsistence wages in violation of
Vietnamese law, working 65 hours a week for $10 or about 15
cents per hour. In addition, these plants have unsafe
conditions where workers breathe toxic fumes at extremely high
levels.
I am Joel Joseph, Chairman of the Made in the USA
Foundation. I am both an economist and an attorney. The
Foundation, started in 1989, has 60,000 members nationwide.
Made in the USA is dedicated to promoting U.S. products in the
United States and overseas. To further that goal, the
Foundation believes that the playing field should be level,
that trade should be fair and the American standards should not
be undercut by nations who do not live up to our environmental,
safety and health and labor standards.
First of all, the overall scope of trade with Vietnam is
very small. During 1997, the Commerce Department reports our
exports to Vietnam were $228 million and our imports from
Vietnam were $388 million. The Foundation estimates are that
Nike, Inc.'s exports from Vietnam are approximately $100
million per year or more than 25% of Vietnam's total exports to
the United States. The Commerce Department's statistics on
Vietnam trade are woefully inadequate and the Foundation was
forced to extrapolate its own data.
Because trade with Vietnam is so small, even if we were to
cut off all trade with Vietnam, it would have a virtually no
noticeable affect on the U.S. economy.
On paper, Vietnam's labor and safety and health laws look
reasonable. The problem is that they are not enforced, either
because of bribery, corruption or incompetence.
Nike, Inc. is unique among American companies operating in
Vietnam. Most American companies pay better and have better
working conditions than Nike provides. However, Nike is the
largest American employer in Vietnam with approximately 25,000
workers who manufacture about 20 million pairs of shoes
annually.
Workers in Vietnam have no freedom of speech. In fact if
they speak while they work they will be physically beaten. This
is how slaves are treated. The United States should push
Vietnam to protect its workers and encourage workplace
democracy.
According to the New York Times, relying on a report by
Ernst & Young, 77% of workers at the Tae Kwang Vina plant in
Dong Nai province, suffered from respiratory problems because
of insufficient ventilation. Toluene exposure at from six to
177 times the legal limit was found at the plant where 9,200
workers produce 400,000 pairs of shoes a month.
A team of MBA students at Tuck Business School at Dartmouth
College studied Nike's operations in Vietnam and found that the
average monthly income of a Nike worker in Vietnam is $32,
which is well below that legal minimum wage of from $35 to $45
per month varying according to provincial law.
The average income per capita in Dong Nai province, where
Nike operates, was $449 in 1995 and estimated to be $700 in
1997, double Nike's wages. The Dong Nai Department of Labor
reported average wages to be $90 for state-owned companies $60
for foreign firms (including most American firms) and $50 for
small private Vietnamese firms. Nike pays an average of $41 in
Dong Nai province.
Is this fair trade? What should the United States do about
the working conditions and wages at plants controlled by
American companies?
The Foundation proposes that exporters from Vietnam be
required:
1. To certify that in the manufacture of products exported
into the United States that all Vietnamese labor and
occupational safety and health laws were complied with; and
2. To certify that all employees working to manufacture
products exported to the United States were paid no less that
twenty-five cents per hour during 1998, no less than thirty-
five cents per hour during 1999 and no less than fifty cents
per hour during the year 2000.
The total current payroll for all Nike workers in Vietnam
is now approximately $10 million per year. (In contrast Nike
spends that amount on Superbowl advertising and pays superstars
Michael Jordan and Tiger Woods more annually than its entire
Vietnam payroll) This workforce manufactures 20 million pairs
of shoes annually. It doesn't take a rocket scientist to
calculate that current labor costs in Vietnam to manufacture a
pair of Nike shoes is now fifty cents. These shoes retail in
the United States for from $50 to $150 a pair.
Based on our proposal the labor costs for a pair of Nikes
will rise to $0.83 per pair immediately, to $1.15 a pair in
1999, and to $1.50 per pair in the year 2000. This labor cost
increase will cause Retail prices in the United States to rise
by about one percent per year.
Compared with the modest impact in the United States, the
result in Vietnam would cause the standard of living to rise
enormously.
How does this help the United States? Simply stated, if
workers around the world are not paid more than subsistence
wages, they cannot afford to buy American products.
In 1914, when the United States was at about the economic
stage that Vietnam is now, Ford autoworkers made $2.50 per day.
Henry Ford overnight doubled his workers' wages to $5.00 a day
and the U.S. economy has blossomed ever since. If workers can
afford to buy the products that they make, everyone benefits.
The United States can truly help the Vietnamese economy by
requiring exporters to the U.S. to pay decent wages. Rather
than subsidizing bailouts, the United States should do its part
to make Asian economies generate more income from exports. If
this was done in Indonesia before the current meltdown, the
need for a bailout would have been prevented.
Chairman Crane. Well, we thank you all for your testimony,
and the timing is perfect because they've rung the bells again
and notified us that we have another vote on the floor. But I
want to express appreciation to all who participated in this
hearing today. And any ongoing information you want to
communicate, please get in touch with the Subcommittee ASAP.
And with that, the Subcommittee stands adjourned. Thank
you.
[Whereupon, at 2:55 p.m., the hearing was adjourned subject
to the call of the Chair.]
[Submissions for the record follow:]
Statement of the Office of the U.S. Trade Representative
Obtaining the fullest possible accounting for POW/MIAs
remains the Administration's top policy priority with respect
to Vietnam, and all other policy decisions are considered with
this in mind, including issues pertaining to economic
normalization and trade relations. In fact, it was in the
context of progress on POW/MIA accounting that President
Clinton lifted our trade embargo in February 1994. Until that
time, the United States had no trade relations with Vietnam. In
July 1995, again in light of continued cooperation in
accounting for POW/MIAs, the President normalized diplomatic
relations with Vietnam, and directed that the process of
economic normalization with Vietnam begin in accordance with
relevant U.S. laws.
With the lifting of the trade embargo in 1994, trade was
allowed to flow between the United States and Vietnam, but not
on normal terms. Vietnamese exports to the United States still
face high tariffs in the range of 40%-80%. These high tariffs,
known as ``Column 2'' rates, apply to the few countries that do
not receive MFN treatment. Vietnam is one of only a small
number of countries that are not currently eligible for normal
trading status.
Extending such most-favored nation trading status to
Vietnam is governed by Title IV of the Trade Act of 1974. Title
IV establishes two preconditions for extending MFN trading
status to Vietnam:
First, Vietnam must meet certain freedom of
emigration requirements set out in the Jackson-Vanik amendment
to the Trade Act. The President may waive these requirements
annually upon a finding that issuing such a waiver would
promote the freedom of emigration goals of the statute. The
State Department has already addressed the granting of this
waiver in March 1998 and its extension this month.
The second precondition on extending MFN status to
Vietnam is the conclusion of a bilateral trade agreement
addressing, at a minimum, the issues of safeguards,
intellectual property rights, the settlement of commercial
differences and disputes, and trade promotion. A bilateral
trade agreement with Vietnam may not enter into force until
after Congress passes a joint resolution of its approval.
If these two criteria are met, MFN treatment can be
extended to Vietnam. However, under Title IV, the continued
extension of MFN trading status to Vietnam is subject to an
important caveat: if the President determines that Vietnam is
not cooperating with our efforts to achieve a full accounting
of military personnel lost during the Vietnam War, he may
revoke its MFN trading status.
From the beginning, the Administration's policy has been to
conclude a solid, commercial agreement with Vietnam that
fulfills three broad objectives:
The agreement should be equitable and mutually
beneficial. This means that in return for extending Vietnam our
low ``column 1'' tariff rates, we expect equitable market
access in Vietnam.
The agreement should be on the basis of
international norms and standards, primarily WTO standards,
since these standards are the basis of our trade relations with
practically every other country. In reality, because Vietnam is
not yet a WTO member, the agreement will need to demonstrate
that Vietnam is moving in a concrete and specific way toward
WTO norms.
The agreement should facilitate trade and
investment. In other words, it should address to a reasonable
degree the concerns expressed by U.S. firms interested in doing
business in Vietnam.
An agreement that meets these three criteria would benefit
both the United States and Vietnam by establishing trade
relations on the firmest possible footing. It would create
business opportunities for exporters on both sides--by giving
Vietnam access to the large U.S. market, and ensuring equitable
access for the United States to Vietnam's growing market of
over 70 million people. Such an agreement would also serve as a
concrete indication of Vietnam's commitment to integrating into
the world economy on terms accepted by nearly all other
countries, and would thereby advance economic reform and
liberalization in Vietnam. In contrast, over the long term, the
lack of an agreement can be expected to result in the loss of
opportunities for Americans in Vietnam's market, since
virtually every other country already has normal trade
relations with Vietnam.
Negotiations on this comprehensive agreement are underway
and making progress. In early 1997, after spending most of 1996
discussing and analyzing Vietnam's trade and investment regime,
the United States completed a detailed proposed text for the
agreement. In April 1997, we successfully concluded negotiation
of a bilateral copyright agreement that will give U.S.
copyrighted works legal protection in Vietnam for the first
time. In October 1997, Vietnam presented a first partial
response to our proposed text of the trade agreement. This was
followed in April 1998 by a detailed comprehensive Vietnamese
response, that included all four substantive issues proposed by
the United States: market access for goods, intellectual
property rights, market access for services, and investment.
In light of the comprehensive Vietnamese response, a round
of negotiations was held in Washington in late May. Those
negotiations served to highlight the areas where the gap
between the two sides has narrowed, as well as areas where our
views continue to diverge. We expect talks to continue actively
in the coming months.
It is difficult to predict when this agreement will be
completed because there are still many substantive issues left
to be resolved. The Administration is firmly committed to
concluding this agreement, and to normalizing trade relations
with Vietnam, but we have made it clear that the agreement must
meet the substantive criteria outlined above for it to be in
the commercial interests of the United States. We will continue
to keep this Committee apprised of progress in the
negotiations, and look forward to working with you to ensure
the approval of the agreement after it is completed.
Statement of Carlos Moore, Executive Vice President, American Textile
Manufacturers Institute
This statement is submitted on behalf of the American
Textile Manufacturers Institute (ATMI), which is the national
association of the textile mill products industry. ATMI's
members collectively account for more than three-quarters of
the textile fibers processed in the United States and are
engaged in the manufacture and marketing of every kind of
textile product.
The trade relationship between the United States and
Vietnam is of substantial importance to the U.S. textile
industry and its workers. Vietnam has a large textile and
apparel manufacturing sector, employing over 700,000 workers at
some of the lowest wage rates to be found in the world. As the
former country of choice for quality garment production for the
Soviet bloc, Vietnam also offers a highly skilled and
professional workforce.
The combination of very low wages and a highly skilled
workforce make Vietnam a force to be reckoned with in the
international sourcing arena. Within three years of being
granted Most Favored Nation (MFN) status by the European Union
(E.U.), Vietnam had become the third largest exporter of
textile and apparel products to the E.U. As a result of this
enormous growth, the E.U. has instituted comprehensive quota
controls on Vietnam in order to prevent damaging new surges.
Today, textiles and apparel account for 70% of the E.U.'s
imports from Vietnam.
As an article in Textile Asia pointed out last year, the
threat to the U.S. textile and apparel sector is very real:
Vietnam's garment industry, already expecting a solid year
with over $1 billion in exports, is preparing to enter the
promised land: a trade agreement between the U.S. and Vietnam
accompanied by the granting of MFN trading status. That move .
. . would unleash Vietnam's garment exports on the U.S., the
largest apparel market in the world.\1\
---------------------------------------------------------------------------
\1\ Textile Asia, April 1997, p. 9
The granting of MFN status to Vietnam will reduce the
apparel tariffs that Vietnam pays from an average of over 50%
to around 18%. Average tariffs on fabrics will fall to even
lower levels. The Vietnamese government has already laid the
groundwork for enormous export growth to the United States by
offering generous tax incentives and building leases of more
than 50 years ``at excellent prices'' to overseas firms.\2\
---------------------------------------------------------------------------
\2\ Women's Wear Daily, 5/12/93.
---------------------------------------------------------------------------
Further, these same reports indicate that Vietnamese firms
are already prepared to exploit these opportunities as soon as
they present themselves. For example:
Nisso Iwai, a large apparel exporter, is shipping
garment samples to Nordstorms, Saks Fifth Avenue, K-mart and
Target in anticipation of MFN status being granted.
The deputy director of Huy Hoang, a large apparel
exporter, reports that this company is poised to increase
capacity once MFN is granted. The company has cleared land for
a new plant that will ``have a capacity of one million jackets
a year'' just for export to the United States.
Minh Phung, another large exporter, is investing
$3 million to build five new garment factories and projects
sales of 500,000 pieces in the first year of MFN.
Without adequate safeguards, it appears virtually certain
that the granting of MFN status will cause a dramatic increase
in low-priced textile and apparel imports into the United
States--with the resulting loss of textile and apparel jobs in
the United States. In addition, granting of MFN status could
threaten successful and productive textile trade agreements
currently in effect with the CBI nations and Mexico which have
resulted in thousands of jobs being created across North
America.
The United States can, however, take steps to prevent a
damaging surge in imports from taking place. This can be
accomplished by requiring that Vietnam sign a comprehensive
bilateral textile and apparel agreement before MFN is granted
or as a part of any commercial bilateral agreement. The textile
and apparel agreement should include the establishment of:
1) Comprehensive quota restrictions on Vietnam's textile
and apparel exports to the United States.
2) Strong anti-transshipment measures, including the right
for U.S. Customs to make unannounced inspections and audits of
Vietnamese textile and apparel plants. Vietnam has already been
caught by U.S. Customs illegally transshipping goods through
third countries.
3) A condition that if Vietnam joins the World Trade
Organization (WTO) its quotas will be subject to a separate 10-
year phase-out beginning upon the date of its entry to the WTO.
4) Effective market access for U.S. textile and apparel
exports. This would include the reduction of Vietnamese tariff
rates to corresponding U.S. rates and the removal of any non-
tariff barriers.
As the Committee is aware, the U.S. textile industry is
already undergoing a difficult period of time during which its
WTO quotas are being phased out and its tariffs reduced. As a
result, global access to the U.S. textile and apparel market
has already been increased by over 30% during the last three
and one-half years. It is critical that Vietnam, as a major
force in textile and apparel trade, be restrained from adding
to this burden by sending a new and damaging surge of textile
and apparel products to the United States.
Thank you for the opportunity to share our industry's
position on this important matter.
Statement of Bill Bell, Former Chief, U.S. Office for POW/MIA Affairs,
Vietnam
Mr Chairman, distinguished members of the Committee, thank
you for the opportunity to submit testimony for today's
important hearing on U.S.-Vietnam relations.
Since the initial stages of our government's postwar
relations with Vietnam, government officials responsible for
the issue have had a keen awareness of Hanoi's long range
negotiating strategy. An extensive Rand Corporation analysis of
the French experience during that country's postwar development
of relations with Vietnam provides a dramatic illustration of
Hanoi's intent: ``Despite the substantial political and
economic concessions the French have made to Hanoi since 1954,
France has never received a full accounting for its missing and
dead. The Vietnamese communist government has consistently
circumvented and violated the terms of the 1954 agreement
concerning the accounting for France's missing servicemen.
Hanoi's actions clearly demonstrate that its only interest in
the French military graves in Vietnam and the requests for
remains by the families of the deceased is in the economic and
political benefits that the Vietnamese Government can derive
from control of these remains. We should keep this in mind in
dealing with Hanoi. We can anticipate that Hanoi's objective is
to obtain increasingly large economic and political concessions
in exchange for piecemeal releases of remains and information
about our missing servicemen.''
Obviously our negotiators failed to heed this sound advice.
But the reasons for this incompetence have never been closely
examined. Today I will attempt to outline for your Committee
the actual chain of developments that have motivated our
government's postwar relations with Vietnam. Hopefully, a
better understanding of such developments will assist your
Committee in considering President Clinton's recent waiver
under the Jackson-Vanik amendment to the Trade Act of 1974.
As you may recall, prior to 1989 our government's most
important issue concerning Vietnam was the achievement of a
viable settlement in war torn Cambodia. Subsequent to the
withdrawal of a politically acceptable number of Vietnamese
forces from that country our focus shifted to the accounting
for our missing and dead from the Vietnam War. At that time the
policy of the Bush Administration dictated that the recovery of
missing American servicemen was a matter of the ``highest
national priority.'' This high priority supported a strategy of
strict reciprocity at the national level, and a high quality
investigative effort on the ground in Vietnam. This proactive,
yet cautious approach to addressing the important POW/MIA issue
precipitated Vietnam's realization that no matter how difficult
the effort, our persistence and perseverance would not diminish
and only genuine cooperation would be acceptable by our
government. These factors enabled our personnel on the ground
in Vietnam to make considerable progress without large
expenditures of government funds. Trade and commercial ties
were never a matter of consideration, because we were
determined not to fall in the same expensive and ultimately
futile rut left by the French.
This strategy meshed well with our long term goal of a full
accounting for our servicemen because Vietnam did not have
financial incentive to retard progress on this important
national issue. Moreover, due to the coincidental collapse of
the Soviet Union, Vietnam also realized that significant
economic assistance from its wartime allies would not be
forthcoming. These conditions served to create a rare window of
opportunity for our negotiators to elicit cooperation from
Vietnam in not only accounting for our missing men, but the
important human rights aspect as well.
But Vietnamese Communists are well known for several
attributes, not the least of which are cunning, tenacity and a
high threshold for pain. During the war years although the
Vietnam Communist Party (VCP) constantly spouted rhetoric
concerning freedom and democracy, its primary goal was
reunification of the country under totalitarian control by the
Communist Party. After accomplishing its initial objective
Hanoi's Politburo even changed the name of the country from a
``democratic'' to a ``socialist'' republic. The word for
democracy ``dan chu'' quickly disappeared from letterheads of
all official government and party correspondence. Dictionaries
printed by the government did not even include the word ``da
dang'' (multi-party).
After reunification Hanoi's design changed to development
of the economy under the continued totalitarian control of the
VCP. In assessing the outlook for reconstruction and
development Hanoi's strategists came to the realization that
although genuine cooperation on POW/MIA accounting would hasten
the pace of relations and significant progress on human rights
would bring economic benefits, such cooperation would
inherently lead to a weakening of totalitarian control by
(VCP). Faced with this dilemma, Hanoi's leadership turned to
its highest-level decision-making body with responsibility for
military affairs, intelligence, counterintelligence, foreign
policy, economics, industry and strategic deception, the
National Defense Council (NDC), for salvation. The NDC of
Vietnam is modeled on similar organizations of the People's
Republic of China and the former Soviet Union. I believe that
those responsible for safeguarding missile and satellite
technology will not find that thought comforting.
In planning and implementing strategic deception, the most
important organ in the communist system is the Proselytizing
Department, which operates under the authority of the NDC. This
department is a very secretive and subtle organization, and for
the U.S. intelligence community, it is perhaps the least
understood element of the Communist apparatus. The basic
mission of the organization is penetration and subversion.
During the war years the Proselytizing Department enjoyed
considerable success in exploiting the anti-war movement in the
U.S. and other countries around the world. Wartime Communist
leaders have since expressed the opinion that the proselytizing
effort, both in America and on an international scale, made the
most important contribution toward winning the war.
The concept by which the Proselytizing Department operates
is quite simple: Obtain the active participation of a small
segment of the population in order to gain the passive
acceptance of the population as a whole. At the local level
active participation can be obtained through intimidation. For
example, during wartime years when armed propaganda teams were
employed, if a member of a village chief's family were
abducted, one of his ears would be sent to the family. Unless
the village chief performed the deed requested of him by the
communist forces, the head of the family member would soon
follow. In dealing with foreign populations, however, active
participation is more often achieved by subtle means. This
includes playing on the emotions of a family whose loved one is
being held prisoner-of-war, or by exploiting character defects,
especially monetary greed, or what in intelligence terms is
called ``a penchant for wealth.'' The Proselytizing Department
is also responsible for both agitation-propaganda and the
exploitation of U.S. POWs. This includes the remains and
personal effects of American servicemen killed during the
performance of their duties.
By the time of the 1986 Party Congress, Hanoi's National
Defense Council had outlined a plan for development of the
economy while feigning cooperation on POW/MIA and human rights.
This plan was veiled as ``an opening to the West'' and
``renovation,'' what the Vietnamese call ``doi moi.'' In order
to implement this plan, seasoned cadre from the Proselytizing
Department were gradually transferred to positions dealing with
individuals and organizations in the U.S. involved in commerce,
human rights and veterans affairs.
For example, Senior Proselytizing cadre Nguyen Chinh was
transferred from Region 5 in Central Vietnam to Hanoi where he
was assigned as the Deputy Director of Religious Affairs
dealing with U.S. officials concerned with human rights. Cadre
Nguyen Hung Tri, who had been one of numerous cadre responsible
for the interrogation and exploitation of American prisoners in
the South, was reassigned as Director of the Export Section of
the National Petroleum Import-Export Department. LTG Tran Van
Quang, the former Chief of the Proselytizing Department, was
reassigned as head of the National Veterans Organization
dealing with so-called ``Veterans Initiatives'' of the Veterans
of Foreign Wars (VFW) and Vietnam Veterans of America (VVA).
Cadre Dang Thuan Hoa, who was also responsible for the
interrogation and exploitation of American prisoners in
southern Vietnam during the war, was reassigned to the
Commercial Affairs Office in Ho Chi Minh City dealing with
American businessmen seeking to invest in projects there.
Members of the Proselytizing Department's office in Central
Vietnam were transferred to the State Petroleum Organization
and shortly thereafter a plan to build an oil refinery in that
area was announced. Ultimately, hundreds of cadre from
Vietnam's Proselytizing Department were reassigned to positions
placing them in direct contact with Americans in the targeted
``influence groups.''
After sufficient proselytizing cadre were in place Vietnam
still faced one major obstacle, hard currency to finance the
overall operation. Hanoi's strategists then devised a plan
whereby large sums of hard currency could be collected. By
forcing hundreds of thousands of its citizens to flee the
country Hanoi was able to quickly establish a large community
of overseas Vietnamese. Most of those departing under this
program were required to transfer all personal and real
property, as well as cash assets, to communist control. To
manage this potential source of future revenue, Hanoi
reassigned its former UN Ambassador in New York and Vice
Foreign Minister, Ho Liem (aka Hoang Bich Son) as Chairman of
the Committee for Overseas Vietnamese. Overseas Vietnamese then
began to send money home to support relatives remaining in
Vietnam. Hard currency mailed from the U.S., Canada, France,
England, Australia and other countries back to Vietnam was
intercepted by the Communist Party and converted into
Vietnamese ``dong'' at a very unfavorable rate. Overseas
Vietnamese seeking to return home for visitation, including
emergency situations, were required to pay exorbitant visa
issuance fees in hard currency to the relevant Vietnamese
Embassy prior to commencement of travel. Unfortunately for the
Vietnamese people at home, however, visa fees are not a problem
because they cannot even acquire a passport to temporarily
travel abroad. As a basis for comparison, in America and other
democratic countries, it is far more simple to file for social
security disability than for a Vietnamese citizen to obtain a
passport.
In much the same manner as the French experience on POW/MIA
accounting, to develop yet another source of revenue Hanoi used
its Proselytizing Department to create an illusion of
profitable business opportunities, a ``last frontier'' if you
will, in Vietnam. This skillful deception, which included what
appeared to be very lucrative contracts to be implemented as
soon as the Trade Embargo was lifted, resulted in increased
pressure from the business community on U.S. politicians to
rapidly remove the POW/MIA issue as an obstacle to the
development of trade ties, regardless of the actual rate of
progress in accounting for our men. To accomplish this feat,
the Proselytizing Department worked hand-in-hand with key
members of the U.S. business community, some members of
Congress and veterans organizations to convince our military
leaders that the best way to resolve the issue was a rapid
expansion of our POW/MIA accounting effort in the field. This
expansion consisted primarily of so-called ``activities,''
which included field cursory investigations and excavations of
crash sites. These ``activities'' resulted in the rental of
Russian supplied helicopters, real property rentals, the
payment of salaries for cadre of the Proselytizing Department
participating in the endeavor, drivers, laborers, organization
fees, landing fees, damages caused by excavations and a host of
other charges. I believe that by simultaneously exploiting
emigration and the accounting for missing American servicemen
Hanoi has managed to accumulate a considerable amount of hard
currency. Such revenue gathering practices continue today as
these hearings are being held, and quite frankly I believe they
generate far more funds than what Export-Import Bank financing
could provide.
In 1991 the U.S. Senate established the Senate Select
Committee for POW/MIA Affairs. The Chairman of this Committee,
Senator John Kerry appointed his Legislative Assistant, Ms
Francis Zwenig, as the Chief of Staff for the Committee. During
the life of the Committee Senator Kerry worked most closely
with Representative Douglas ``Pete'' Peterson to authorize
funding for the new, expanded effort to account for missing
American servicemen in Vietnam. As a result of these joint
efforts, in January 1992 the Joint Task Force-Full Accounting
was formed by the U.S. Pacific Command. In order to gain
acceptance of the new plan in Vietnam Senator Kerry also
coordinated his efforts with fellow committee member, Senator
John McCain (R, AZ).
In implementing Senator Kerry and Representative Peterson's
plan, Ms Zwenig worked closely with Ms Virginia Foote, the
President of the U.S./Vietnam Trade Council, Allen ``Gunner''
Kent, former Commander-in-Chief of the Veterans of Foreign Wars
(VFW), and Mr Kenneth Steadman, at that time the Director of
National Security of the VFW. As the Committee moved toward
adjournment it became increasingly obvious that rather than
account for missing American servicemen, the primary goal of
the Committee was to remove the POW/MIA issue from the path of
U.S./Vietnam relations. Members of the Committee pledged to
continue to monitor the issue, but in reality only Senator Bob
Smith kept his promise to the MIA family members and veterans
here at home.
During the time that key members of the POW/MIA Select
Committee maneuvered to remove the Trade Embargo, large scale
investors in Asia, who would ultimately become large scale
campaign contributors in America began to support the
activities of members of the Committee designed to create
investment opportunities in Vietnam. In 1992, with a one-on-one
limousine ride, Presidential candidate Bill Clinton began his
relationship with Mr James Riady, a citizen of Indonesia and
resident alien of the United States. Mr Riady is the son of
Mochtar Riady who heads the multi-billion dollar Lippo Group.
Acting on behalf of the Lippo Group Mr Riady formed a
partnership with Mr Jackson Stephens, Chairman of Stephens
Investment Inc., in order to purchase the Worthen Bank in
Little Rock, AR. Mr Riady was subsequently installed as the
director of the bank. Mr Riady then used his position to
contribute or loan some $700,000.00 to President Clinton's
campaign. Family friends and business partners of the Riadys,
Ariel and Soraya Wiriadinata, also contributed $425,000.00 to
the Clinton campaign. Rather than explain the source of these
monies by testifying in congressional hearings, the
Wiriadinatas have since returned to Jakarta, Indonesia.
The Worthen Bank in Little Rock also owned the Hong Kong
Chinese Bank where Mr John Huang was employed. Mr Huang was
later transferred from Hong Kong to Los Angeles where he became
head of Lippo's affiliate there. Records since made available
to investigating committees of Congress indicate that in
conjunction with his transfer to the U.S. Mr Huang was awarded
a $700,000.00 bonus by the Lippo Group. Considering the
position held by Mr Huang and the circumstances of his
employment, the alleged bonus has raised questions regarding
the intended purpose of the relatively large amount of cash,
and whether or not it was properly declared for entry into the
U.S. Moreover, in November 1992, China Resources Holding
Company, a front organization for the Intelligence and Security
Services of the Communist Party of China, purchased a
controlling interest in the Hong Kong Chinese Bank. This
transaction made available an even larger amount of money to Mr
Huang in the U.S.
During his election campaign President Clinton pledged to
the American people that if elected he ``would not normalize
relations with any country that is at all suspected of
withholding information'' on missing Americans. After the
election of President Clinton Mr John Huang was appointed as a
Deputy Assistant Secretary under Commerce Secretary Ron Brown
in a ``Top Secret'' trade post. When Mr Huang assumed his new
position at the Commerce Department the very first meeting he
held in his new office was oriented toward developing increased
commercial relations with the Socialist Republic of Vietnam.
Hearings held by the Senate Committee investigating
campaign financing revealed that during the time he worked in
the Commerce Department under Ron Brown, John Huang maintained
steady contact with Mr A. Vernon Weaver, the Vice-President of
Stephens Investment in Washington, D.C. In fact, Mr Huang was
provided a cost-free office with telephone, facsimile and
photocopy machine in the Stephens Building across the street
from the Commerce Department. During the same time frame,
Secretary Brown became the subject of a Justice Department
investigation concerning allegations he accepted a $700,000.00
bribe for his assistance in lobbying President Clinton to lift
the Trade Embargo against Vietnam. The reports indicating that
Mr Riady loaned the Clinton campaign $700,000.00, that John
Huang received a $700,000.00 bonus from the Lippo Group, and
that former Commerce Secretary Brown received a $700,000.00
bribe may be coincidental, but considering the positions of
those involved and their relationship to each other, I
seriously doubt that this is the case.
After repeated denials to the press, Secretary Brown did
admit to having three meetings with Mr Nguyen Van Hao, a
Vietnamese who was actively lobbying on behalf of Vietnam to
have the Trade Embargo lifted. Mr A. Vernon Weaver was
subsequently appointed as the U.S. Representative to the
European Economic Union. The investigation of Mr Brown was
terminated when he died on April 4, 1996 in an airplane crash
while on an economic mission to Europe.
After expanded accounting efforts were initiated in Vietnam
senior U.S. officials first began praising Vietnam for its
cooperation in accounting for our missing men during January
1994 when Admiral Charles Larson, at that time the Commander-
in-Chief of Pacific Forces, returned from an inspection trip to
Vietnam. It was Admiral Larson who first stated publicly that
Vietnamese cooperation in accounting for missing Americans was
``excellent across all fronts.'' Admiral Larson was a four star
Admiral at the time and pending retirement because there were
no four star slots available in the U.S. Navy.
Based on Admiral Larson's assessment, in February 1994
President Clinton lifted the trade embargo against Vietnam.
Amazingly, between the time that President Clinton made his
pledge that he would not normalize relations with Vietnam until
there was a full accounting and the time he lifted the Trade
Embargo only two Americans had been accounted for in Vietnam.
Lifting the embargo opened the door for the multi-billion
dollar corporation, Lippo Group with American business
partners, such as Stephens Investment of Little Rock, AR to
conduct business in Vietnam. Mr A. Vernon Weaver, at that time
the Vice-President for Operations in the Pacific Rim of
Stephens Investment and a member of the Board of Visitors at
the U.S. Naval Academy was instrumental in arranging an upgrade
of the position of Commandant of the U.S. Naval Academy from
two stars to four stars. Former U.S. Navy officers, Senators
John Kerry and John McCain supported this reorganization.
Rather than the planned retirement, Admiral Larson was quickly
transferred to begin a four year tour at the Naval Academy.
President Clinton then appointed VFW Commander-in-Chief,
Allen ``Gunner'' Kent of the VFW to a senior position in the
Veterans Administration (VA). After working on the transition
team of former Secretary Ron Brown at the Commerce Department,
Ms Francis Zwenig was appointed as Vice-President of the U.S.
Vietnam Trade Council. Shortly thereafter, the Council took
control of the Mekong Digest, formerly the Vietnam Forum of the
Vietnam Veterans Against the War. A friend of both President
Clinton and Senator John Kerry and fellow anti-war activist
from Georgia, Mr Charles Searcy, was appointed as a
humanitarian aid representative for Vietnam, on a project
jointly funded by the U.S. Government and the Vietnam Veterans
of America Foundation headed by Mr Robert Muller, also a well-
known anti-war activist. Vietnam then announced that it would
issue its first real estate license to Senator John Kerry's
cousin, Mr Stuart Forbes, CEO of the Boston-based Colliers
International. Representative ``Pete'' Peterson was appointed
by President Clinton as Ambassador to Vietnam. Senator John
McCain became Chairman of the Senate Commerce Committee.
Mr John Huang, was ultimately appointed as Vice-Chairman of
the national fund-raising committee of the Democratic Party. Mr
Huang's fund raising efforts included a visit by Vice President
Gore to a Buddhist Temple in California headed by Vietnamese
born Summa Ching Hai, a long time associate of both Huang and
Little Rock, AR restaurant owner Charlie Trii. Highly
classified documents of the Vietnam Communist Party (VCP),
recently declassified in the National Archives, indicate that
the Religious Proselytizing Department of the VCP, code named
V.417, successfully infiltrated cadre into the Buddhist Sect in
the former Republic of Vietnam during the 1960's. According to
the Chairman of the Washington, D.C., Maryland and Virginia
Vietnamese Association, some of the cadre mentioned in the
documents have since arrived in the U.S. as refugees. These
same cadre, currently in leadership positions in the Buddhist
Sect in California, now profess to be staunch anti-communists.
Testimony from members of the staff at the temple involved in
the fund-raising, as well as numerous others involved, indicate
that those participating in the scheme of Huang were well aware
that the sole purpose of the visit by the Vice President was to
raise money for the Clinton-Gore campaign. In fact, the only
person involved who has publicly claimed to be unaware that the
event was a fund raiser is Vice President Gore himself.
Although considerable questions remain unanswered some of
the key people involved, Mr John Huang, Admiral Larson, Ms
Virginia Foote, Ms Francis Zwenig or Mr A. Vernon Weaver have
never testified in Congress. More recently the Justice
Department has authorized the appointment of an additional
Special Counsel to investigate allegations of illegal business
transactions between Labor Secretary Alexis Herman and Vanessa
Weaver. Hopefully, this investigation will uncover additional
leads for Congressional Committees to follow in the days ahead.
Contrary to the glowing assessments by the Clinton
Administration, MIA family member organizations have maintained
that Vietnam could rapidly account for many more missing
servicemen if it made the political decision to do so. I
believe that there is ample evidence in U.S. files that Vietnam
does possess this capability. Against opposition by MIA family
member organizations and major veterans organizations,
including the American Legion, Vietnam Veterans of America, the
National Vietnam Veterans Coalition, American Veterans, and the
Disabled American Veterans, President Clinton recently waived
the Jackson-Vanik Act in order to provide monetary benefits to
Vietnam. Such benefits include Export-Import Bank financing and
Overseas Private Investment Corporation (OPIC) insurance.
Obviously, both important steps are directed at obtaining Most
Favored Nation (MFN) trading status for Vietnam.
During my tour as Chief of the U.S. Office for POW/MIA
Affairs in Hanoi I was constantly mindful of the French
experience in Vietnam. I was also painfully aware of the plight
of some 70 million Vietnamese citizens regarding basic human
rights. Relying on a wealth of information contained in U.S.
Government files and based on my own experiences in dealing
with Vietnam over many years I carefully evaluated the actual
level of cooperation rendered by Vietnam on a routine basis. I
truthfully and accurately reported those assessments to my
superiors. At times, my candidness during congressional
hearings here in Washington, D.C. resulted in my being denied a
re-entry visa to return Vietnam from those hearings, and it was
only intervention by your prestigious body that enabled me to
resume my duties in Hanoi.
Today I do not have to be concerned about how my remarks
will be received by my superiors here in the U.S. Government,
or by the Communist Party in Hanoi. Hopefully, I have provided
some insight concerning how our political process can be
manipulated by foreign entities. I am optimistic that this
information, as well as information to be provided by witnesses
involved in other aspects of the U.S.-Vietnam relationship,
will help your Committee convince our leadership that profit
must not come before principle in the development of commercial
ties with the Vietnam.
Organizations lobbying for increased financial benefits to
Vietnam, especially Overseas Private Investment Corporation
insurance are well aware that the Communist Party of Vietnam,
not the government of Vietnam runs that country. They are
clamoring for your Committee to move ahead in U.S.-Vietnam
relations. They are telling the families of the missing men
that they should trust the Communist Party to provide an honest
accounting. They are telling the Vietnamese people that they
should trust the Communist Party in future progress for human
rights. Mr Chairman, if these lobbyists have so much trust in
the Communist Party of Vietnam, then why do they need
government sponsored insurance such as OPIC to protect their
investments?
You may recall that during the Proselytizing Department's
campaign to rapidly normalize relations while feigning
improvement on POW/MIA accounting and human rights glib
statements such as ``its the economy stupid,'' and ``Vietnam is
not a war, its a country'' were often attributed to a number of
government officials and members of Congress returning from
fact finding missions to Vietnam. I hope your Committee will
agree that statements such as ``its the missing servicemen and
human rights stupid,'' and ``Vietnam is not a war, its a
socialist republic'' are far more appropriate statements to
make.
That concludes my testimony, I greatly appreciate the
opportunity to testify before your distinguished Committee.
Statement of Caterpillar Inc.
Caterpillar Inc. is pleased that United States continues to
take steps to strengthen the trade relationship between Vietnam
and the US by seeking renewal of Vietnam's waiver under the
Jackson-Vanik amendment to the Trade Act of 1974. This action
stands to benefit the people of both countries.
We're hopeful that trade relations between the United
States and Vietnam--including export opportunities supporting
U.S. jobs--will grow significantly over the coming years as
relations between our two countries continue to improve.
The first evidence of this growth is encouraging. Prior to
the initial Jackson-Vanik waiver issued in March of this year,
Caterpillar was at a distinct disadvantage in Vietnam due to
the fact that most of our global competition had access to
government-backed financing, credit or credit guarantees. Since
the waiver, Caterpillar has applications pending with the Trade
and Development Agency (TDA), Export-Import Bank (ExIm) and the
Overseas Private Investment Corporation (OPIC) for projects
that will improve the infrastructure of Vietnam and the quality
of life of its people.
These projects will not bear fruit if the Jackson-Vanik
waiver is defeated. In light of the progress being made,
Caterpillar strongly urges Congressional support for the waiver
of Jackson-Vanik for Vietnam.
Caterpillar Inc. is the world's leading manufacturer of
construction and mining equipment, natural gas engines and
industrial gas turbines, and is a leading manufacturer of
diesel engines. Headquartered in Peoria, Ill., the company
exported a record $6.12 billion worth of products from the
United States during 1997.
Statement of Hon. Lane Evans, a Representative in Congress from the
State of Illinois
Mr. Chairman, thank you for the opportunity to testify
before the Committee.
The Committee's upcoming vote on waiving the Jackson-Vanik
amendment for Vietnam is among one of the more important you
will consider this year. And it comes at a special moment in
our relationship with Vietnam. If we make the right choice, we
can encourage reforms that may lead to an open and prosperous
Vietnam. However, if we make the wrong choice, we will send a
signal that the US is not willing to follow through on its
commitment to reward reform with better relations. That is why
this vote is so important.
We must remember that closer ties between our nations have
been a catalyst for needed economic and societal reforms. They
have also led to significant progress on issues our nation has
been pursuing with the Vietnamese for some time. Of primary
importance has been our efforts to account for our missing in
action from the war. Vietnam has been providing a high level of
cooperation in our efforts to account for our missing. The
Joint Task Force-Full Accounting (JTF-FA), our military
presence in Vietnam dedicated to this mission, is receiving the
logistical support it needs from the Vietnamese in addition to
access to witnesses and archival information. JTF-FA search
teams are allowed to travel throughout the country at will to
pursue leads or excavate for remains. These efforts have led to
concrete results. Since 1993, 233 remains have been repatriated
and 97 remains identified. In order to maintain the access that
is so critical to the in-country mission of the JTF-FA, we must
remain engaged with the Vietnamese government.
In addition, our government has pushed the Vietnamese to
reform its emigration policy under the Resettlement Opportunity
for Vietnamese Returnees (ROVR) program. While there were
initial concerns over the implementation of the program,
Vietnam has made substantial progress. As of June 8, 1998
Vietnam has cleared for interview over 15,000 of the almost
19,000 (or 81 percent) of applicants for the ROVR program. As
of this date, 3,119 Vietnamese have come to the US under the
program, just over a year since the US and Vietnam signed the
ROVR agreement.
However, we cannot expect continued cooperation from the
Vietnamese on these and other issues if we continue to promise
better ties without taking steps to strengthen the relationship
between our two nations. The waiver of the Jackson-Vanik
amendment is crucial in this regard.
This move will not prevent our nation from exercising the
leverage necessary to pressure the Vietnamese for progress on
important issues. Congress would still have to review the
waiver annually. This would more than insure that Vietnam would
have to carefully consider the ramifications of policy
decisions, especially in the area of emigration, that effect US
interests.
While we fully recognize that Vietnam still has a long way
to go in terms of improving its human rights record and
achieving needed economic reforms, we believe that achieving
closer relations is the best way to eventually achieve these
goals as well as serve long-term US interests in the region.
Now is the time to move forward, not backwards, in promoting a
better climate between our two nations. Our former colleague
and now Ambassador to Vietnam, Pete Peterson, recently stated:
``America's constructive engagement with Vietnam benefits both
nations. Renewing the Jackson-Vanik waiver is crucial for
keeping that relationship on track: It will enhance our
commercial ties and help our efforts to achieve fullest
possible accounting for American POWs and MIAs.''
As a former prisoner of war, Ambassador Peterson's support
for promoting conciliation and closer ties speak volumes to the
potential of what our nation can achieve in Vietnam. I hope
that you take his thoughts to heart and support the waiver of
the Jackson-Vanik amendment for Vietnam. Thank you.
Andre Sauvageot
Hanoi
June 22, 1998
Congressman Philip M. Crane
Chairman, Subcommittee on Trade
House Committee on Ways & Means
Dear Congressman Crane:
I am Andre Sauvageot, residing in Hanoi, as the Chief
Representative for General Electric in Vietnam. I have held this
position for over 5 years. I am submitting the following information to
assist the Committee in its decision regarding the renewal of the
Jackson-Vanik waiver for Vietnam.
I. Vietnam Experience Prior to Joining General Electric
My involvement in Vietnam began in 1964 as a U.S. Army
Captain assigned as a District Advisor in South Vietnam. This
entailed participating in combat operations with small South
Vietnamese units and afforded opportunities to learn about life
and civil administration at the village level.
From 1976 to 1978 I was assigned to the Department of
Health, Education & Welfare, as an Assistant Director to the
Indochina Refugee Assistant Program to help with the
resettlement of Vietnamese refugees in the United States. In
1984, I retired as a Colonel from the Army after 27 years of
service.
From 1982 to as recently as 1993, I served as the
interpreter for the highest level American delegations visiting
Hanoi. The initial focus was solely on the MIA/POW issue, but
later broadened to include some of Vietnam's humanitarian
concerns. Until December 1992, I was employed by the U.S.
Embassy in Bangkok as the Regional Advisor for the
Comprehensive Plan of Action designed to encourage voluntary
repatriation of Vietnamese ``boat people'' back to Vietnam.
This involved constant visits to the camps in Hong Kong and
Southeast Asia with follow-up visits to returnees in Vietnam. I
enjoyed steadfast support from Vietnam's Government throughout
my mission.
II. Lessons Learned from Experience Prior to GE Employment
My long involvement in Vietnam has given me a profound
respect for the Vietnamese. I believe that Vietnamese
pragmatism, flexibility and intelligence makes it a country
which is very amenable to constructive engagement. My own
observation, supplemented by the opinion of Department of
Defense experts working the issue full time have led me to
conclude that cooperation on the MIA/POW issue is excellent and
has increased as the U.S.-Vietnam relationship expands. The
same is true on a range of other commercial and human rights
issues. Progress on all issues is positively correlated with
improvements in the overall relationship based on the principle
of mutual benefit.
III. General Electric in Vietnam
A. Establishing the GE Representative Office
After former President Bush permitted American companies to
establish representative offices in Vietnam, GE was among the
first ten American companies to seize the opportunity, having
obtained a license by 18 June '93 for the main office in Hanoi
and by 19 August '93 for a branch office in Ho Chi Minh City.
B. Difficulties and Opportunities in doing business in Vietnam
(a) Difficulties--It comes as no surprise that doing
business in Vietnam is tough sledding. How could it be
otherwise? A country which has until comparatively recently
been ravaged by war and constrained to meet continued
challenges to its national security cannot move very quickly
from feudalism through Soviet-style state socialism to a market
economy.
The specific problems with an underdeveloped banking
system, underdeveloped legal and physical infrastructure, lack
of transparency and corruption are serious and combine to make
it relatively difficult to do business. American companies have
the additional handicap of arriving behind foreign competitors
which were not constrained by the U.S. Trade embargo against
Vietnam.
Added to that, the lack of domestic capital and severely
limited national budgets constrain the Vietnamese and their
foreign business partners or providers to providers to seek
off-shore funding. Financing must often be in the form of
Government to Government soft loans, as budget constraints may
preclude commercial financing. It is a market for marathon
runners with an in-country presence--not for sprinters,
especially those who merely sprint in and out of Vietnam.
(b) Opportunities--The good news outweighs the bad news.
Vietnam offers a stable, predictable environment. The
leadership's commitment to economic reform, its commitment to
diversification of Vietnam's international relationships, the
national unity behind the leadership on both of these major
policies, the strong work ethic, a literate, intelligent,
trainable workforce are durable, valuable and more significant
than the ephemeral difficulties which so frustrate foreign
companies doing business in Vietnam.
These strengths are the ingredients by which Vietnam will
effectively address its shortcomings. Vietnam will succeed. The
only question is which companies from which countries will grow
their businesses in Vietnam, in short will grow with the
country.
C. Accomplishments by some GE Businesses
To illustrate this, lets turn to the specific
accomplishments and near-term opportunities of GE Businesses in
Vietnam. Several of GE's 12 major businesses, each with its
separate headquarters in the United States, have already
successfully entered Vietnam's market.
(a) GE Medical Systems (GEMS).--Medical Systems, a global
Business, headquartered in Milwaukee, Wisconsin was the first
of GE's 12 major businesses to begin doing business in Vietnam,
because in April 1992, former President Bush exempted certain
kinds of humanitarian items including medical equipment, from
the Trade Embargo.
Since 1993, GEMS has been selling ultrasound and x-ray
equipment against stiff competition from long established
foreign competitors including Siemens from Germany and some
Japanese companies. Even so, GEMS has sold nearly $10 million
worth of high quality medical equipment to Vietnamese hospitals
throughout the country. This includes some very modern Magnetic
Resonance Imaging (MRI) equipment manufactured in Wisconsin.
(b) GE Aircraft Engines (GEAE).--GE Aircraft Engines,
headquartered in Cincinnati, Ohio regards the Vietnam Airline
(VNA) as an important customer with tremendous growth
potential. VNA airline has selected GE engines with an
aggregate value of some $162 million, to power its entire small
fleet of Boeing and Airbus aircraft. Specifically,
--CF6-80C2B7F engines on Vietnam Airlines (VNA) 3 Boeing
767-300ER aircraft;
--CFM56-5B4 engines on all 10 VNA Airbus Aircraft. This is
a joint venture engine with SNECMA from France. Half the engine
is manufactured in Cincinnati and half in France.
(c) GE Capital Aviation Services (GECAS).--One of the 27
major branches of GE Capital Services, headquartered in
Stamford, Connecticut, GECAS has dry-leased 3 new Boeing 767-
300ER aircraft to the Vietnam Airline for a period of 5 years.
(d) GE Power Systems (GEPS).--GE Power Systems,
headquartered in Schenectady, New York, manufactures steam
turbines and generators in New York and gas turbines in
Greenville, South Carolina. During tough international bidding
GETS won the following contracts in Vietnam:
--First ever gas compressors ($12 million) for the White
Tiger field to bring in gas from off shore;
--Generator ($15 million) for Ham Thuan 300MW hydro plant
(bid won February 1998);
--Steam turbines and generators ($42 million) for Pha Lai-2
600MW thermal, coal-fired power plant;
(e) GE Transportation Systems (GETS).--Headquartered in
Erie, Pennsylvania, GETS manufactures locomotives and parts and
components for its locomotives. In Vietnam GETS has won
international bids two years in a row (1996-'97) to provide
parts/components to the Vietnam Railways (VR) for overhaul and
upgrade of its old GE diesel locomotives.
The VR appreciates the high quality and competitive price
of GE's new locomotives. GE is trying to find a funding sources
for a new locomotive purchase. GETS expects to present a
proposal in August for an initial purchase of 5-7 new
locomotives, for some $10-$15 million in turnover. Winning this
contract would position GETS for down stream sales of some 80-
100 new locomotives, representing revenue in excess of $200
million in revenue and continued jobs for workers in Erie.
(f) GE Lighting (GEL).--GE Lighting, headquartered in
Cleveland, Ohio is off to a reasonably good start with annual
sales running over $1 million.
(g) GE Industrial Control Systems (GEICS).--GE Industrial
Control Systems is a global business, headquartered in Salem,
Virginia. GEICS will provide the generator control equipment
for the 300MW Ham Thuan hydro power plant.
D. Immediate GE Opportunities and Impact of Jackson-Vanik
Waiver
(a) Thac Ba Hydro Plant Upgrade.--Electricity of Vietnam
(EVN) has decided to upgrade a 30-year old Soviet-built hydro
power plant named Thac Ba. The project is ``supplier credit''
that is the contractor must present a competitive financing
proposal. GE's competitors include ABB (Switzerland/Sweden);
Siemens (Germany) and GEC Alstrom from France.
GE is extremely competitive from a technical standpoint
because of its high quality and because unlike ABB or Siemens,
GE manufactures both the turbine and generator, as well as the
turbine and generator control equipment and exciter units.
GE requested financial assistance from Eximbank in support
of its bid to supply equipment for the Thac Ba Project.
Eximbank has provided GE a Letter of Interest which indicates a
willingness of the Bank to consider making such assistance
available if EVN should award a contract to GE and if an
appropriate repayment guarantee is provided by the Government
of Vietnam.
The $10 million would be for the purchase of turbine and
generator control equipment manufactured by American workers in
Salem, Virginia. Moreover, winning this contract could help GE
position itself for further wins in Vietnam's growing hydro
power market. Thac Ba could be an important stepping stone to
Son La, a giant 4,000MW hydro power plant for which the
planning is already quite advanced.
However, if the President's renewal of Jackson-Vanik is not
sustained, GE would be immediately eliminated from further
pursuit of this project. We would not even be able to recoup
the money already spent on travel and conducting the
feasibility study for the project. Worse, the contract would be
awarded by default to a foreign company and GE's position for
future contracts would be weakened.
Currently, Vietnam has many alternatives. In the event that
GE is eliminated from the project because the Jackson-Vanik
waiver is not sustained, Vietnam will still be able to complete
the upgrade on time with an acceptable, feasible proposal.
(b) Other Large Projects.--Perhaps counter-intuitively,
failure to sustain the President's renewal of the Jackson-Vanik
waiver can greatly damage GE's chances against foreign
competition on projects for which ODA funding is available and
for which U.S. Eximbank financing is neither available nor
desired.
For example, assume Vietnam's largest donor country, Japan,
is funding a large project and GE happens to be competing with
a Japanese company in this context. Even though Japan's aid is
``untied,'' should both the GE proposal and the Japanese
company's proposal be technically and economically feasible,
political considerations could become a factor in determining
Vietnam's national interest. In summary, diminished U.S.
involvement results in less U.S. leverage.
IV. Conclusion
Experience strongly suggests that as the relationship
continues to improve on the basis of mutual respect and mutual
benefit, progress will continue on all fronts.
We will continue to work closely with the U.S. Government
and we highly appreciate the active support for American
business and the American worker which we have received from
Ambassador Peterson in Hanoi.
We will also continue our active involvement with such
organizations as the U.S.-Vietnam Trade Council; U.S.-Asian-
Pacific Council of American Chamber of Commerce in Vietnam.
I believe that the most rigorous analysis suggests that
there is no conflict in pursuit of GE's commercial objectives
in Vietnam and other objectives. In fact, they are positively
correlated.
Jefferson Waterman International
Washington, DC 20005
June 23, 1998
The Hon. Phil Crane, Chairman
Subcommittee on Trade
Committee on Ways and Means
U.S. House of Representatives
1104 Longworth House Office Building
Washington, D.C. 20515
Dear Chairman Crane,
I am writing to express strong support for the continuation of the
Jackson-Vanik waiver with respect to Vietnam. I urge the Committee to
oppose any disapproval resolutions with respect to the Jackson-Vanik
waiver for Vietnam.
The President's initial waiver of this provision earlier this year,
and his request to renew this waiver on June 3, are important to US
firms for several reasons. First, the waiver paved the way for US firms
to gain access to the Export Import (ExIm) Bank and the Overseas
Private Investment Corporation (OPIC). With many of our fiercest
competitors already doing business in Vietnam using their national
export credit and investment finance agencies, US firms have been
operating at a severe disadvantage. Unlocking Vietnam to US companies
using the tools of the ExIm Bank and OPIC levels the playing field.
Second, the waiver has strengthened our hand in negotiating a sound
bilateral trade agreement, which will lead to the establishment of
normal trading relations and, ultimately, Vietnam's accession to the
WTO. By making this first step toward the normalization of commercial
relations, the President has signaled his interest in fostering a
strong economic partnership with Vietnam.
The waiver is also important in advancing other foreign policy
issues, such as those pertaining to refugees or cooperation with POW/
MIAs. Administration officials, including Ambassador Pete Peterson,
have noted that the Government of Vietnam has dramatically increased
its cooperation on these issues in recent years. I agree with the
Administration that a continuation of the Jackson-Vanik waiver on
Vietnam would advance this policy of engagement, which will bring about
even closer relations.
You should also remember that the Administration's decision to
waive Jackson-Vanik with respect to Vietnam, thus lifting prohibitions
on OPIC and ExIm Bank activity there, is a breath of fresh air in the
increasingly stifling atmosphere on sanctions. As you know, the recent
proliferation of unilateral economic sanctions has chilled much
commercial activity at questionable benefit to US foreign policy. You
have been a leader in congressional efforts to reform the process by
which sanctions are imposed. The waiver on Vietnam is an important step
in the right direction that must be enthusiastically embraced and
vigorously defended.
On a final note, I would point out that the Jackson-Vanik process
has become increasingly anachronistic. Although it once reflected a
cogent freedom of emigration policy directed at the Soviet Union and
other communist states, this rationale seems to have crumbled along
with the Berlin Wall. In an attachment, I have listed the 18 countries
currently subject to the conditions and penalties of Jackson-Vanik. All
but five have been granted full certifications acknowledging that they
provide freedom of emigration. Three others have been granted waivers--
some for many years. Only Cuba and North Korea--two countries subject
to layers of other federal sanctions--are feel the full penalties of
Jackson Vanik. With this in mind, the Jackson-Vanik conditions seem to
have lost their relevance.
Moreover, the conditionality imposed by Jackson-Vanik is at odds
with the unconditional application of MFN treatment for out WTO trading
partners. So far, Mongolia is our only trading partner who is both a
WTO member and whose MFN is conditioned by Jackson-Vanik. As a result,
we cannot fully apply the WTO to that country. As more and more
Jackson-Vanik countries accede to the WTO, we will be forced to assume
non-application policies with other trading partners. For a country
that has been a leader in formulating and implementing the WTO, and
that has vigorously championed the concept of liberalized trade, this
is unacceptable.
I applaud you on your effort to update the term of ``most favored
nation'' trading status. As the Jackson-Vanik amendment celebrates its
25th birthday next year, I would encourage you to update this tired
policy as well.
Sincerely,
Stephen Lamar
Sr. Vice President
Attachment
Jackson-Vanik Countries
Countries subject to full penalties under J-V
Cuba
North Korea
Countries subject to annual June J-V waiver
Belarus (1)
China (2)
Vietnam (3)
Countries that have been granted freedom of emigration determinations
Albania (4)
Armenia (5)
Azerbaijan (5)
Georgia (5)
Kazakhstan (6)
Kyrgyzstan (6)
Moldova (5)
Mongolia (7)
Russia (8)
Tajikistan (6)
Turkmenistan (6)
Ukraine (5)
Uzbekistan (6)
Notes:
1. The President granted an initial Jackson-Vanik waiver on April
16, 1992.
2. The President granted an initial Jackson-Vanik waiver on October
23, 1979. Although Congress has had several opportunities to vote to
overturn this waiver, it has never succeeded in doing so.
3. The President granted an initial Jackson-Vanik waiver on March
11, 1998.
4. The President determined that Albania was in ``full compliance''
with Jackson-Vanik on December 5, 1997.
5. The President determined that these countries were in ``full
compliance'' with Jackson-Vanik on June 3, 1997.
6. The President determined that these countries were in ``full
compliance'' with Jackson-Vanik on December 5, 1997.
7. The President determined that Mongolia was in ``full
compliance'' with Jackson-Vanik on September 4, 1996. Legislation (HR
2133, S. 343) is now pending that would remove Mongolia from the list
of countries subject to Jackson-Vanik.
8. The President determined that Russia was in ``full compliance''
with Jackson-Vanik on September 21, 1994.
Source: Legis; Jefferson Waterman International; Compilation of US
Trade Statutes, House Ways and Means Committee, 1997; Presidential
Documents from White House Web Site.
Last Updated: May 6, 1998
National Association of Manufacturers
Washington, DC 20004-1790
June 17, 1998
The Honorable Phil Crane, Chairman
Subcommittee on Ways and Means
U.S. House of Representatives
1104 Longworth Building
Washington, DC 20515
Dear Chairman Crane,
On behalf of the members of the National Association of
Manufacturers (NAM), I am writing to express strong support for
continuation of the Jackson-Vanik waiver for Vietnam.
The President's renewal of this waiver is important to U.S.
manufacturers for several reasons. First, the waiver allows American
businesses access to the services of the Export Import (Ex-Im) Bank and
the Overseas Private Investment Corporation (OPIC), which is crucial to
the success of U.S. exporters and investors. Continued Ex-Im and OPIC
financing means that U.S. firms would be able to compete on a level
playing field with those foreign firms that are already conducting
business in Vietnam with the full support of their governments.
Second, the waiver shows the commitment and interest of the United
States in normalizing economic relations with Vietnam. By granting
most-favored-nation status to Vietnam, the United States strengthens
its position in negotiating a solid bilateral trade agreement, which
will eventually lead to Vietnam's accession to the World Trade
Organization (WTO). Both of these mechanisms are vital to Vietnam's
becoming a sophisticated, market-oriented and responsible player in the
world marketplace.
The waiver is also important to advancing other key foreign policy
issues, such as those pertaining to human rights. Vietnam has
noticeably increased its cooperation in recent years on these matters.
By continuing the Jackson-Vanik waiver, the United States would remain
actively engaged with Vietnam, which would help to strengthen the
bilateral relationship.
Therefore, we urge you and the members of the Committee to vote
against disapproval resolutions with respect to the Jackson-Vanik
waiver for Vietnam.
Sincerely,
Howard Lewis III
Vice President, Economic Policy
Vietnam Veterans of America Foundation
Washington, DC 20009
June 18, 1998
The Honorable Philip M. Crane
Member, House of Representatives (R-Illinois)
Chairman
Subcommittee on Trade
House Ways and Means Committee
Washington, D.C. 20515
Dear Mr. Crane,
The purpose of this testimony is to voice Vietnam Veterans of
America Foundation's (VVAF) full support for the extension of the
waiver of the Jackson-Vanik amendment for Vietnam. Extension of this
waiver is a critical step as the United States and Vietnam continue to
develop trusting and mutually beneficial diplomatic relations and
strive for normalized economic relations. By not extending this waiver,
the United States will severely harm American economic and political
interests in Vietnam. It will also send the wrong message to the world
that our country will not provide consistent leadership to developing
and reform-minded countries who look to the United States for guidance
and support during these often difficult transitions.
VVAF has been returning to Vietnam on a regular basis for over 17
years and opened an office in Hanoi in 1995. Beginning with the
establishment of a children's rehabilitation clinic in Hanoi three
years ago, VVAF continues to operate and develop humanitarian programs
to help the Vietnamese people improve their standard of living. VVAF
will soon open an adult prosthetics clinic and is establishing a mobile
medical outreach program to serve disabled persons residing in outlying
provinces. VVAF leadership in the United States and in Vietnam
continues to work with American and Vietnamese governmental,
educational and humanitarian organizations to improve relations at all
levels.
Beginning with trips to Vietnam in the 1980s, through the present,
we have seen Vietnam make great progress on many important issues.
Progress has significantly increased in recent years as the United
States decided to engage rather than isolate Vietnam. Since the United
States opened a dialogue with Vietnam to attempt to resolve MIA,
emigration, and other issues, the Vietnamese have responded in a
positive and pro-active manner. Excellent progress has been made in
every area and the pursuit to attain the fullest possible accounting
for American service persons missing in action in Vietnam has become a
normalized process for both sides.
As an organization that has been involved in many important issues
between Vietnam and the United States for nearly twenty years, we are
familiar with strong feelings by individuals and groups with differing
views on relations with Vietnam. As it has been a full generation since
our military involvement in Vietnam, it is critical that as we move
toward the future, we base our relationship with Vietnam on shared
values and common interests, not on historical political differences.
If we continue to be haunted by the ghosts of the past, a constructive
relationship will never develop.
American companies entered the Vietnamese market late and are just
beginning to catch up to their European and regional competitors. Not
renewing this waiver would set these companies back considerably. In
the midst of the Asian financial crisis, American companies have unique
opportunities to provide leadership and stability in the region.
Additionally, American companies operating in Vietnam provide
considerable support for VVAF humanitarian projects in Vietnam. Not
renewing this waiver would result in a significant decrease in U.S.
corporate support for VVAF's programs, ultimately hurting the
Vietnamese people.
I urge you, Mr. Chairman, to carefully consider the many
consequences associated with a non-renewal of the Jackson-Vanik
amendment waiver for Vietnam. The victims of a non-renewal would
include American citizens who are looking toward a better future,
American companies that depend on U.S. governmental support to compete
in the global market, Vietnamese citizens who receive humanitarian aid
or work for U.S. companies, and the integrity of the American political
system. Extending this waiver will create winners instead of victims
and will show America, Vietnam and the world that the United States is
committed to providing dependable and predictable global leadership.
Sincerely,
Robert O. Muller
President
Statement of Willard A. Workman, U.S. Chamber of Commerce
The U.S. Chamber of Commerce appreciates the opportunity to
submit this statement of strong support for the extension of
the Jackson-Vanik waiver for Vietnam. I am Willard A. Workman,
Vice President of the International Division at the U.S.
Chamber.
The U.S. Chamber believes that building a solid commercial
foundation for our relationship with Vietnam will encourage
cooperation on the full range of issues in our bilateral
relationship, from emigration to a full accounting of American
POWs and MIAs. Cooperation could be put at risk if the Jackson-
Vanik waiver were withdrawn. For these reasons, we applaud the
Trade Subcommittee's vote on June 23 to report adversely the
resolution to disapprove the Jackson-Vanik waiver.
The U.S. Chamber is the world's largest business
federation, representing more than three million businesses and
organizations of every size, sector and region. Many U.S.
Chamber members are reentering Vietnam for the first time in 20
years. Other members are entering Vietnamese markets for the
first time ever.
The U.S. Chamber is doing its part to foster commercial
ties with Vietnam. To accommodate the growing interest of our
members in Vietnam and Southeast Asia, the U.S. Chamber has
added staff and devoted new resources to expanding our Asia
division. We also have facilitated business contacts by hosting
events at the U.S. Chamber for officials from the U.S. embassy
in Vietnam and the Vietnamese embassy in Washington, DC. In the
fall, the U.S. Chamber plans to switch roles from host to
visitor and send a delegation to Vietnam to meet with American
companies operating locally.
Potential of the Vietnam Market
The attraction to the Vietnamese market is simple: it holds
huge potential for American business. At present, two-way trade
is worth approximately $1 billion. This modest number reflects
the fact that the trade embargo was lifted only a few years ago
and that the average GNP per capita in Vietnam is barely over
$300, according to World Bank figures. Yet, annual growth rates
have averaged 8 to 9 percent despite the limitations of a
centrally planned economy. This growth rate coupled with a
population of 78 million, the second largest in Southeast Asia,
presents large market opportunities over the long term.
In addition, there are significant demographic and cultural
changes in Vietnam that could benefit American business. Over
half of Vietnam's population is under the age of 25 years old.
The younger generation has been exposed to foreign consumer
brands in stores, on the radio and even on MTV. Increasingly,
the brands are American. In addition, English has replaced
French and Russian as the second most common language in
Vietnam, largely because of the interest of the younger
generation. This will help American business target the younger
generation as they become more prosperous.
If we fail to remain engaged with Vietnam, we will cede the
potential of this market to competitors in Europe, Japan and
other parts of Asia. Foreign firms operating in Vietnam already
have a head start over American companies. The United States is
only the eighth largest investor in Vietnam with $1.2 billion
worth of capital. Singapore, Taiwan, Hong Kong and Japan are
the top investors with an average of $4 billion worth of
capital.
In addition, American companies operating in Vietnam only
recently have obtained access to U.S. trade promotion programs
at the U.S. Export-Import Bank (ExIm) and the Overseas Private
Investment Corporation (OPIC). These agencies require the
Jackson-Vanik waiver in order to extend their programs to
Vietnam. If the waiver were revoked, access to U.S. trade
promotion programs would end, and American companies would be
placed at a competitive disadvantage in relation to foreign
competitors.
Like China, the Vietnamese economy will continue to grow at
a rapid pace provided that Vietnam's leadership remains firmly
committed to carrying out economic reform. The financial crisis
in Asia could strengthen the hand of those who do not support
market-opening. Conservative party members in Vietnam argue
currency and capital controls have sheltered the country's
economy from the turmoil in the region. Commercial engagement
sends a countervailing message that there are benefits from
opening markets.
Challenges Confronting American Companies in Vietnam
The U.S. Chamber understands the challenge of doing
business in Vietnam. The Vietnamese economy is undergoing a
slow transformation from a centrally planned economy, which has
resulted in confusing and contradictory regulations, foreign
exchange shortages, new taxes and red tape. Corruption also
continues to be a problem in many areas. The frustrations of
some U.S. Chamber members have been widely publicized.
Commercial engagement with Vietnam works on two levels to
address these problems. At a local level, U.S. Chamber members
help to promote fundamental rights wherever they operate by
establishing benchmarks for corporate practices in such
critical areas as personnel management, corporate citizenship,
fairness and equal opportunity. Many companies have made their
commitments explicit through a corporate statement of
principles. This has had a positive impact on Vietnamese
workers and local government officials.
In addition, the United States and Vietnam are engaged in
the process of negotiating a broad commercial agreement, which
is a prerequisite to extending most-favored-nation (MFN) status
on a mutual basis. (MFN status is the normal trade treatment
that the United States provides to almost all of its trading
partners.) The commercial agreement will have four major
components: market access, services, investment and
intellectual property. It will impose trade-related disciplines
on Vietnamese authorities and bring Vietnamese law closer to
international trade norms. The agreement also will lead to
greater transparency in commercial dealings.
Because Congress will have an opportunity to vote on the
final agreement, we urge Members to make it clear that the
Administration should seek commitments from Vietnam that are
compatible with the disciplines under the World Trade
Organization (WTO), especially in the areas of investment,
technical barriers to trade, subsidies and intellectual
property. Not only will this provide more protection for
American businesses in Vietnam, but it also will facilitate
Vietnam's accession to the WTO and avoid the marathon
negotiations that have characterized bilateral talks with China
over WTO accession.
Failure to extend the Jackson-Vanik waiver, however, could
undermine progress made to date in our trade negotiations. It
also could send the message to the Vietnamese government that
we are not committed to continuing on the path to full
normalization, which might jeopardize progress on other
bilateral issues. Attached are two recent letters from the U.S.
Chamber to the leadership in the Senate and House voicing this
concern.
Commercial Engagement with Vietnam Yields Political Benefits
The U.S. Chamber is sensitive to the legacy of the Vietnam
War. The U.S. government's priority is, and should continue to
be, obtaining the fullest possible accounting of American
servicemen missing from the war. Concerns also exist about
emigration, human rights and religious freedoms in Vietnam.
Commercial engagement provides the United States with
leverage to encourage continued cooperation. Vietnam has
already demonstrated its desire to shed its outsider past. It
has joined the Association of Southeast Asian Nations; will
accede to the Asia-Pacific Economic Cooperation (APEC) forum
this fall; and has tabled its first substantive proposal as
part of negotiations to join the WTO. In addition, the
Vietnamese government has expressed a strong interest in
obtaining MFN status from the United States.
There is strong evidence that the policy of commercial
engagement has worked. The purpose of the Jackson-Vanik
amendment is to encourage a free emigration policy in communist
countries. Since the Administration normalized relations with
Hanoi, Vietnam has cleared for interview over 80 percent of all
remaining applicants of the Resettlement Opportunity for
Vietnamese Returnees agreement. On the day that the President
announced his decision to extend the Jackson-Vanik waiver, the
Vietnamese government announced that it would permit U.S.
officials to interview all emigration applications under the
Orderly Departure Program for an ethnic group known as the
Montagnards.
Commercial engagement also provides the United States with
several ``sticks'' to use in the unlikely event that Vietnam
abruptly changes its policies. Even after a commercial
agreement is completed and approved by Congress, the President
may still revoke MFN treatment if he determines that Vietnam is
not cooperating with U.S. efforts to achieve a full accounting
of military personnel lost during the Vietnam War.
Conclusion
The U.S. Chamber strongly endorses extending the waiver of
the Jackson-Vanik amendment to Vietnam. The decision will
strengthen U.S.-Vietnam commercial ties to the benefit of U.S.
Chamber members across America and their employees. Commercial
engagement also provides a solid foundation for progress on
other bilateral issues such as the conclusion of unsolved POW/
MIA cases, emigration matters and human rights. Clearly,
revoking the waiver at a time when Vietnam has been willing to
cooperate on a broad spectrum of issues could jeopardize future
progress and undermine U.S. leverage.
On behalf of the U.S. Chamber of Commerce, thank you for
providing the opportunity for us to express our support for
upholding the Jackson-Vanik waiver for Vietnam and continuing a
policy of commercial engagement.
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