U.S. GOVERNMENT PRINTING OFFICE

69–535 CC WASHINGTON : 2001

PRELUDE TO NEW DIRECTIONS IN UNITED STATESVIETNAM RELATIONS: THE 2000 BILATERAL

TRADE AGREEMENT

JOINT HEARING

BEFORE THE

SUBCOMMITTEES ON

ASIA AND THE PACIFIC

AND

INTERNATIONAL ECONOMIC POLICY AND TRADE

OF THE

COMMITTEE ON

INTERNATIONAL RELATIONS

HOUSE OF REPRESENTATIVES

ONE HUNDRED SIXTH CONGRESS

SECOND SESSION

SEPTEMBER 19, 2000

Serial No. 106–182

Printed for the use of the Committee on International Relations

(

Available via the World Wide Web: http://www.house.gov/international—relations

2

COMMITTEE ON INTERNATIONAL RELATIONS

BENJAMIN A. GILMAN, New York, Chairman

WILLIAM F. GOODLING, Pennsylvania

JAMES A. LEACH, Iowa

HENRY J. HYDE, Illinois

DOUG BEREUTER, Nebraska

CHRISTOPHER H. SMITH, New Jersey

DAN BURTON, Indiana

ELTON GALLEGLY, California

ILEANA ROS-LEHTINEN, Florida

CASS BALLENGER, North Carolina

DANA ROHRABACHER, California

DONALD A. MANZULLO, Illinois

EDWARD R. ROYCE, California

PETER T. KING, New York

STEVE CHABOT, Ohio

MARSHALL ‘‘MARK’’ SANFORD, South

Carolina

MATT SALMON, Arizona

AMO HOUGHTON, New York

TOM CAMPBELL, California

JOHN M. MCHUGH, New York

KEVIN BRADY, Texas

RICHARD BURR, North Carolina

PAUL E. GILLMOR, Ohio

GEORGE RADANOVICH, California

JOHN COOKSEY, Louisiana

THOMAS G. TANCREDO, Colorado

SAM GEJDENSON, Connecticut

TOM LANTOS, California

HOWARD L. BERMAN, California

GARY L. ACKERMAN, New York

ENI F.H. FALEOMAVAEGA, American

Samoa

DONALD M. PAYNE, New Jersey

ROBERT MENENDEZ, New Jersey

SHERROD BROWN, Ohio

CYNTHIA A. MCKINNEY, Georgia

ALCEE L. HASTINGS, Florida

PAT DANNER, Missouri

EARL F. HILLIARD, Alabama

BRAD SHERMAN, California

ROBERT WEXLER, Florida

STEVEN R. ROTHMAN, New Jersey

JIM DAVIS, Florida

EARL POMEROY, North Dakota

WILLIAM D. DELAHUNT, Massachusetts

GREGORY W. MEEKS, New York

BARBARA LEE, California

JOSEPH CROWLEY, New York

JOSEPH M. HOEFFEL, Pennsylvania

[VACANCY]

RICHARD J. GARON, Chief of Staff

KATHLEEN BERTELSEN MOAZED, Democratic Chief of Staff

(II)

3

SUBCOMMITTEE ON ASIA AND THE PACIFIC

DOUG BEREUTER, Nebraska, Chairman

JAMES A. LEACH, Iowa

DANA ROHRABACHER, California

PETER T. KING, New York

MARSHALL ‘‘MARK’’ SANFORD, South

Carolina

MATT SALMON, Arizona

JOHN M. MCHUGH, New York

RICHARD BURR, North Carolina

PAUL GILLMOR, Ohio

DONALD A. MANZULLO, Illinois

EDWARD R. ROYCE, California

JOHN COOKSEY, Louisiana

TOM LANTOS, California

HOWARD L. BERMAN, California

ENI F.H. FALEOMAVAEGA, American

Samoa

SHERROD BROWN, Ohio

ROBERT WEXLER, Florida

JIM DAVIS, Florida

EARL POMEROY, North Dakota

GARY L. ACKERMAN, New York

ALCEE HASTINGS, Florida

[VACANCY]

MICHAEL P. ENNIS, Subcommittee Staff Director

DR. ROBERT KING, Democratic Professional Staff Member

MATT REYNOLDS, Counsel

ALICIA A. O’DONNELL, Staff Associate

SUBCOMMITTEE ON INTERNATIONAL ECONOMIC POLICY AND TRADE

ILEANA ROS-LEHTINEN, Florida, Chairman

DONALD A. MANZULLO, Illinois

STEVEN J. CHABOT, Ohio

KEVIN BRADY, Texas

GEORGE RADANOVICH, California

JOHN COOKSEY, Louisiana

DOUG BEREUTER, Nebraska

DANA ROHRABACHER, California

TOM CAMPBELL, California

RICHARD BURR, North Carolina

ROBERT MENENDEZ, New Jersey

PAT DANNER, Missouri

EARL HILLIARD, Alabama

BRAD SHERMAN, California

STEVEN R. ROTHMAN, New Jersey

WILLIAM D. DELAHUNT, Massachusetts

JOSEPH CROWLEY, New York

JOSEPH M. HOEFFEL, Pennsylvania

MAURICIO TAMARGO, Subcommittee Staff Director

SEAN CARROLL, Democratic Professional Staff Member

YLEEM POBLETE, Professional Staff Member

VICTOR MALDONADO, Staff Associate

(III)

(V)

C O N T E N T S

WITNESSES

Page

Ambassador Charlene Barshefsky, U.S. Trade Representative ........................... 5

The Honorable Stanley O. Roth, Assistant Secretary for East Asian and

Pacific Affairs, U.S. Department of State .......................................................... 15

The Honorable Timothy J. Hauser, Deputy Under Secretary for International

Trade, U.S. Department of Commerce ............................................................... 17

APPENDIX

Prepared statements:

Hon. Doug Bereuter, a Representative in Congress from Nebraska, and Chairman, Subcommittee on Asia and the Pacific ...................................................... 30

Hon. Ileana Ros-Lehtinen, a Representative in Congress from Florida, and

Chairman, Subcommittee on International Economic Policy and Trade ......... 33

The Honorable Dana Rohrabacher, a Representative in Congress from California ..................................................................................................................... 36

Hon. Charlene Barshefsky ...................................................................................... 39

Hon. Stanley O. Roth .............................................................................................. 47

Hon. Timothy J. Hauser .......................................................................................... 53

Additional material submitted for the record:

Answers to questions for the record by Hon. Doug Bereuter ............................... 57

Articles submitted for the record by Hon. Dana Rohrabacher ............................. 59

(1)

PRELUDE TO NEW DIRECTIONS IN UNITED

STATES-VIETNAM RELATIONS: THE 2000 BILATERAL TRADE AGREEMENT

TUESDAY, SEPTEMBER 19, 2000

HOUSE OF REPRESENTATIVES, SUBCOMMITTEE ON ASIA

AND THE PACIFIC, JOINT WITH THE SUBCOMMITTEE ON

INTERNATIONAL ECONOMIC POLICY AND TRADE, COMMITTEE ON INTERNATIONAL RELATIONS,

Washington, DC.

The Subcommittees met, pursuant to notice, at 1:36 p.m., in

room 2172, Rayburn House Office Building, Hon. Doug Bereuter

(Chairman of the Subcommittee on Asia and the Pacific) presiding.

Mr. BEREUTER. The joint Subcommittee hearing will come to

order. The Subcommittee on Asia and the Pacific and the Subcommittee on International Economic Policy and Trade meet jointly

today to examine the current and future state of United StatesVietnam relations in the context of a new bilateral trade agreement

[BTA] signed by Washington and Hanoi on July 13, 2000.

After taking nearly 5 years of frustrating and difficult negotiations—and the difficulties are on the other side—I think the new

bilateral trade agreement represents an important milestone in the

process of normalizing incrementally our bilateral political, economic, humanitarian, and consular relationships with Vietnam.

Focusing for a moment on the economic relationship, this evolving process began in 1994 with the lifting of the Vietnam War-era

trade embargo and the establishment of Ambassadorial-level diplomatic relations the following year. Further incremental steps such

as allowing for the Overseas Private Investment Corporation

[OPIC] and the U.S. Export-Import Bank to support American

businesses exporting to or operating in Vietnam were taken as the

President granted Vietnam a waiver from the requirements of the

Jackson-Vanik amendment. The Congress, in general, has supported this waiver by increasingly large margins each of the last

3 years.

The new BTA represents another step which will be followed by

President Clinton’s trip to Vietnam following the APEC summit in

November. I believe that this incremental policy and the new BTA

is in America’s own short-term and long-term national interests. It

is a flexible policy allowing us to take advantage of new opportunities such as those in the trade arena now available with the BTA,

while at the same time preserving our leverage to help influence

change in the most problematic facets of our relationship, such as

human rights. Indeed, I believe our incremental approach also

2

builds on Vietnam’s own policy of political and economic reintegration into the world.

The Subcommittee on Asia and the Pacific has held a number of

hearings on Vietnam in recent years, conducting both broad reviews of the general direction of United States-Vietnam bilateral

relations and more defined examinations of specific issues such as

the fullest possible accounting of American POW–MIAs, the plight

of Vietnamese boat people and the failure of Vietnam to meet its

human rights obligations. Today’s hearing is the first that focuses

primarily on bilateral economic relations; however, it certainly does

not do so at the exclusion of these other important issues. Clearly

United States-Vietnamese trade relations cannot be viewed as if in

a vacuum.

At this time, the BTA has yet to be transmitted to Congress. I

certainly welcome any insights our U.S. Trade Representative Ambassador Barshefsky may have on when we should expect to see

that transmittal. With adjournment hopefully just a few weeks

away, there is not time this year for Congress to consider and approve the BTA, a prerequisite for the agreement’s actual implementation. Thus I envision today’s hearing as an early opportunity to

begin the process of congressional consideration of such a BTA.

Before Congress will approve the significant step forward in relations, there will be many questions for the Administration to answer satisfactorily. For example, is the BTA a prelude to new directions in United States-Vietnam relations? What actual benefits can

the United States generally and the American business interests

specifically expect from the BTA? Does approval of the BTA enhance or serve to postpone needed progress in other noneconomic

concerns such as POW–MIA accounting, human rights, emigration,

and political reforms?

To help our two Subcommittees answer these and many other

important questions, including those pertaining to the President’s

Vietnam trip, we are very fortunate to have with us today a truly

outstanding panel of high-level and distinguished Administration

witnesses. The first panel will consist of Ambassador Charlene

Barshefsky, the U.S. Trade Representative. While the BTA is the

result of hard work from many different agencies, of course, it is

the USTR that has provided the yeoman’s service in the negotiations with the Vietnamese as was the case with the bilateral market access agreement for China’s accession to the WTO.

Ambassador Barshefsky, it certainly was a great pleasure to

work with you on the China PNTR issue, and I understand that

in a hour or 2, the Senate will be voting on final passage of H.R.

4444 as passed by the House, and, in my judgment, thankfully

unamended by the Senate. In that regard, I appreciate that you

have responsibilities associated with the vote and are limited in the

time that you can spend with us. That is why you constitute the

first panel. And I will introduce the other two distinguished witnesses shortly after your testimony and questions from the panel.

But in order to conserve this time before you must leave, I want

to come back to that later.

And I would like now to turn to the Chairwoman of the Subcommittee on International Economic Policy and Trade, the very

distinguished gentlewoman from Florida, Representative Ileana

3

Ros-Lehtinen, for any introductory comments that she may have,

and then I will turn to the distinguished Ranking Members of the

two Subcommittees. I turn to the gentlelady for such time as she

may consume.

[The prepared statement of Mr. Bereuter appears in the appendix.]

Ms. ROS-LEHTINEN. I thank my colleague in Nebraska, my good

friend Mr. Bereuter, for the opportunity to co-chair this hearing

with him. I welcome the opportunity to listen to some of our witnesses. And while the witnesses appearing before us today may be

of like mind in their approach to United States-Vietnam relations,

there are vast differences among the Chairs of the two Subcommittees regarding the viability and wisdom of trading with a Communist regime such as Vietnam.

In fact, some of us view Vietnam as a classic example of what

happens when economic engagement begins without first requiring

fundamental, concrete changes in government and civil society. The

result? A sprinkling of limited economic reforms to mask the

strengthening of Communist totalitarian regimes.

In Vietnam such entrenchment was clearly demonstrated in 1999

with the passage of a resolution which stated that, ‘‘Party committees should strictly criticize and punish those party members who,

after being assisted by the party organization, keep disseminating

their own opinion or distributing documents contrary to the platform, statutes or resolutions of the party.’’ In August of this year, a report for the Vietnamese Communist

Party’s Congress was drafted making reference to the so-called

process of reform started 15 years ago. However, that same document reiterated that, ‘‘During the process of reform, it is essential

to persist with the goal of socialism based on Marxist-Leninism and

Ho Chi Minh ideology.’’ This coincides with the April 1992 Vietnamese Constitution reaffirming the role of the Communist Party

as the leading force of the state and society.

Article 4 of the Vietnamese Constitution enables the security apparatus to enforce an extralegal administrative decree against any

dissidents under the pretext of ‘‘endangering national security.’’

The Vietnamese Government continues to systematically violate

the human rights, civil liberties, and religious freedom of its people. It utilizes a maze of laws, decrees, and regulations to prohibit

religious worship and to justify the arbitrary arrest, detention, harassment, physical abuse, and censorship of those seeking to exert

their religious liberty and the right to free association.

The Vietnamese regime is among the ‘‘totalitarian or authoritarian regimes’’ specifically rebuked by the State Department for

its religious restrictions. The intense governmental suppression

and control came under scrutiny and harsh criticism when the Annual Report on International Religious Freedom was released earlier this month. However, these denunciations fell on deaf ears as

the Vietnamese Government had already been rewarded in August

with the signing of the bilateral trade agreement.

Despite the trade agreement, the Supreme Patriarch of the Unified Church of Vietnam is still being detained without trial under

pagoda arrest. Members of the Hoa Hoa sect of Buddhism have

been subjected to police surveillance and remain in jail. Members

4

of the Cao Dai religion have had their church property confiscated.

Protestants are still being suppressed through police raids, surveillance, and negative propaganda.

Even foreign investors in June of this year questioned the ‘‘fanfare and hype’’ of communist Vietnam’s reform process and issued

complaints about overregulation, inconsistent application of laws,

discriminatory pricing, and government bureaucracy. Timothy

Reinhold, head of the legal working group for the private sector

forum at which these concerns were raised, said, ‘‘It prompts one

to ask the question whether those currently directing policy really

want foreign participation in the development of the country.’’ Further, newspaper reports cited Vietnam’s Minister of Planning and

Investment as ‘‘generally unsympathetic to investor complaints.’’ Vietnam is still one of the most repressive countries in the world,

which, in turn, keeps it as one of the poorest with an average annual per capita income of $330.

The most recent Index of Economic Freedom published by Heritage Foundation lists Vietnam 148, out of 161 nations, in lack of

economic freedom. This marks a decrease from the 1995 rating.

That is, Vietnam’s economy is considered to be less open today

than it was 5 years ago.

Despite these realities, the single most powerful reason for demanding much more from Vietnam before affording it the enviable

position of United States trading partner and preferential trade

status, is the yet unresolved issue of American POWs and MIAs.

During my investigation into the torture of American POWs in

Vietnam by Cuban agents at a camp known as ‘‘The Zoo,’’ I asked

Ambassador Pete Peterson and other U.S. Government officials to

secure specific information and materials from the Vietnamese authorities. The response from the Vietnamese clearly depicts the unreliable, duplicitous nature of Vietnam’s Communist regime. The

statement read: ‘‘The evading war of the Americans in Vietnam

had caused a great damage in human lives and property to the people of Vietnam. However, with a policy of clemency and humanity,

Vietnam treated the American POWs in due form. There were absolutely no cases in which American POWs in Vietnam were tortured.’’

Is this the type of regime the United States should reward? Is

this a reliable trading partner? An ally? I hope the witnesses who

will testify today will address these issues along with the other

concerns raised by my colleagues on the Subcommittees, and I

thank Mr. Bereuter for the opportunity.

[The prepared statement of Ms. Ros-Lehtinen appears in the appendix.]

Mr. BEREUTER. I thank the Chairwoman, and I turn to the distinguished gentleman from California, the Ranking Member of the

Asia and Pacific Subcommittee, for such time as he may consume

in his opening statement.

Mr. LANTOS. Thank you very much, Mr. Chairman. I am anxious

to hear Ambassador Barshefsky, so I will be extremely brief.

Vietnam represents an obviously unique case in our foreign relations and in our trade relations. This is really an issue where many

of us have a great deal of ambivalence. On the one hand, I fully

share the views of my good friend from Florida, who outlined in

5

great detail the human rights violations which are persisting in

Vietnam and for which there is no excuse. Yet I think it would be

a mistake not to recognize that the United States has a major responsibility in normalizing relations with Vietnam.

I fully share the views of my two distinguished colleagues in the

other body, John Kerry and John McCain, who have supported the

normalization of relations, and who, I believe, are in support of this

legislation, as is our good friend and former colleague with considerable Vietnam experience, Ambassador Pete Peterson.

I commend President Clinton for his forthcoming plan to visit

Vietnam, and I look forward to Ambassador Barshefsky’s testimony.

Mr. BEREUTER. In order to save time, we are going to move directly to the statement by Ambassador Barshefsky. Your entire

written statement will be made a part of the record. You may proceed as you wish. We look to at least a small opportunity to have

questions before you have to leave. But we will have your full

statement at this point.

Mr. ROHRABACHER. Mr. Chairman, I ask unanimous consent to

insert my opening statement for the record as well as the inserts

of several publication articles that I had for the opening statement.

Mr. BEREUTER. Certainly, without objection, we will extend that

to all Members at this point.

[The prepared statement and articles of Mr. Rohrabacher appear

in the appendix.]

Ambassador Barshefsky.

STATEMENT OF THE HON. CHARLENE BARSHEFSKY, U.S.

TRADE REPRESENTATIVE

Ambassador BARSHEFSKY. Thank you, Mr. Chairman, Madam

Chairman, Members of the Subcommittees. Thank you very much

for inviting me here today to testify on our bilateral commercial

agreement with Vietnam.

The landmark trade agreement entered with Vietnam in July of

this year is most fundamentally an economic agreement which

opens markets to American goods, services and agriculture and

promotes economic reform and great opening to the world in Vietnam.

It also represents a decisive stage in the process of reconciliation

with Vietnam. With the approval of this agreement, we begin a

fully normalized economic and trade relationship, capping a series

of decisions made over the past decade which have been difficult

and emotional at times in both countries, but which have served

Americans and Vietnamese together.

Throughout this period, as the Clinton Administration has approached America’s relationship with Indochina, we have set as our

first priority a full accounting for American service personnel listed

as missing in action or who were POWs. As Ambassador Pete Peterson has noted, this work is proceeding with full cooperation with

Vietnam through joint field activities and review of material evidence. With this continuing, we have also worked toward normalized trade between the United States and the three nations of

Indochina, beginning with the end of the trade embargoes and continuing through the conclusion of formal bilateral trade agreements

6

with Cambodia, Laos, and now Vietnam. This we believe serves

America’s broad interests in the Pacific.

The integration of Indochina into ASEAN and the larger Pacific

economy contributes to the cohesion and economic health of Southeast Asia, which is in turn of great importance to peace and stability in Asia more generally. Our developing trade relationship

with Vietnam helps us achieve this basic goal as it also creates

substantial new opportunities for American businesses, farmers,

workers, and for Vietnamese as well.

Our trade and investment relationship with Vietnam today, however, remains hampered by two major features. First, as a country

covered by the Jackson-Vanik amendment, Vietnam remains only

one of six in the world that lacks NTR status. As a result, Vietnamese products face tariffs approximately 10 times higher than

those of virtually all other trading partners.

Second, economic reform within Vietnam has progressed slowly,

particularly in recent years, owing to the Asian financial crisis,

weakening the economy’s overall potential and creating obstacles

for American exporters.

The United States-Vietnam trade agreement addresses both of

these issues. It marks a major shift of economic policy direction for

Vietnam, setting a course for greater openness to the outside world,

promoting internal reform and market principles, transparency in

law and regulatory policy, and helping Vietnam to integrate itself

into the Pacific regional economy and build a foundation for future

entry into the World Trade Organization.

The agreement itself includes six chapters: Goods, including agricultural goods; intellectual property; services; investment; business

facilitation; and transparency. To highlight a few specifics, in goods

trade Vietnam will cut tariffs by a third to a half across a wide

range of high-tech goods, farm products, and industrial goods. Vietnam will also abolish nontariff restrictions such as quotas, eliminate discretionary import licensing, and, for the first time, guaranteed trading rights for both Americans and Vietnamese over a

phased-in schedule.

With respect to intellectual property, Vietnam will implement

WTO-level standards of protection within 1 year for patents and

trademarks and within 18 months for copyright and trade secrets.

Vietnam will also take certain additional steps in newer areas such

as the protection of satellite signals.

As to services, Vietnam will liberalize a broad range of service

sectors opening for the first time opportunity for American firms to

compete in basic telecommunications services, value-added telecom

such as Internet services, banking, insurance, and other financial

services; the professions including legal services, architecture, engineering and others; and a range of other sectors from audiovisual

to health, distribution to private education and more.

With respect to investment, Vietnam will make commitments

that include the phasing out of such measures as local content and

export performance requirements; the abolition of almost all investment screening, discriminatory pricing; and protection against expropriation.

7

As to business facilitation, Vietnam will guarantee the right to

conduct routine but essential practices such as setting up offices,

advertising, and so on.

Finally, Vietnam will make an extensive set of commitments to

transparency. In sharp contrast to past practice, Vietnam will reform its administrative policies. It will now provide advance notice

of all laws, regulations and administrative procedures relating to

any matter covered by the agreement. It will now publish all laws

and regulations and inform the public of the effective dates and

government contact points, and Vietnam will establish appeals

processes.

All together, the agreement addresses many of the principal concerns of Americans seeking to export to or invest in Vietnam and

spur a deepening acceleration of economic reform within the Vietnamese economy. Over time that should help create sustainable

growth and greater opportunity for the Vietnamese people.

The agreement is an economic achievement that will have shared

and substantial benefits. It will also have beneficial political consequences, contributing to the development of a more unified and

stable Southeast Asia as it integrates Vietnam once again into the

broader world of Asian-Pacific trade and investment. And it is an

agreement with historic meaning for the United States. When Congress approves this agreement with a granting of annual normal

trade relations, we will take the critical step in developing a relationship with Vietnam that looks to the future rather than the

past, and we will do so in a fashion in which I believe everyone

who remembers the era of the Vietnam War can take pride, both

cementing peace and reconciliation between the two governments

and advancing reform and freedom for the Vietnamese people.

In that regard, I would point to a recent statement made by Vietnam’s leading independent—leading and most visible dissenter Dr.

Que, and he said, ‘‘ Opening the country economically will increase

the people’s power to make their own economic decisions. Integrating into the global economy and increasing contact with developing countries will increase the people’s awareness of what it

means to be modern. The sooner the trade agreement is ratified

and put into effect, the better.’’

We look forward to working with you, Mr. Chairman, Members

of the Subcommittees, to developing a consensus for the best way

to secure rapid approval of the agreement. Thank you.

[The prepared statement of Ambassador Barshefsky appears in

the appendix.]

Mr. BEREUTER. Thank you very much.

We have only 15 minutes remaining, and I want to hear from all

Members. I would ask unanimous consent that the normal 5-

minute rule be changed to 3 minutes so that all Members may be

heard. Is there objection? Without objection, that will be the order.

I have one question that relates to the difference between the

1999 agreement in principle and the final agreement July 13, 2000,

Ambassador. I will submit other questions in writing in order to

save time.

Ambassador BARSHEFSKY. Fine, thank you.

[The additional questions appear in the appendix.]

8

Mr. BEREUTER. The gentleman from California, Mr. Lantos, is

recognized under a 3-minute rule.

Mr. LANTOS. I was listening very carefully to your usual concise

and impressive presentation, but I did not hear any response on

your part to Ms. Ros-Lehtinen’s catalog of human rights abuses.

Now, we have had a long-standing dialogue of the deaf ones, ‘‘dialogue des sourdes’’ as the French call it, between the Administration and those of us who feel that human rights criteria should receive a far more important level of consideration than, in fact, they

have.

Would you mind, Ambassador Barshefsky, dealing with the

issues raised by my friend from Florida? Because while some of us

are conscious of the fact that we have a very heavy responsibility

vis-a-vis Vietnam for obvious historic reasons, we will not stand by

as the human rights abuses are swept under the rug and the truly

outrageous persecution of religious groups and others continues.

Ambassador BARSHEFSKY. I think you will hear more about this

from the panel that follows me, but if I could make a few points.

I do not disagree with the characterizations made by the Chairwoman with respect to the Vietnamese regime or with respect to

substantial concerns about human rights, religious freedom and the

like in Vietnam. These are quite amply documented in the State

Department human rights report and in other materials, including

from the United Nations. And I certainly have no basis to disagree

with them, nor would I attempt to do so.

The question presented is how do we best change the mentality

among the governing body in Vietnam as to the expected conduct

with respect to human rights as to international norms and the

vast importance of Vietnam meeting those norms with respect to

human rights, worker rights, and with respect to issues surrounding human dignity.

The quote I read to you from Dr. Que speaks to one approach to

that question, and it is the approach generally that the Administration has followed in the case of China and now wishes to follow

in the case of Vietnam.

Mr. LANTOS. If I may stop you, since you raised China, which I

was trying hard to avoid—— Ambassador BARSHEFSKY. I know.

Mr. LANTOS. The Administration policy has been a total failure

with respect to China on the human rights issue. As a matter of

fact, the Administration’s own documents, both the religious document, the human rights document, underscores quite accurately

the deterioration of the human rights situation in China.

So if what we can look forward to vis-a-vis Vietnam is a repetition of the China pattern, that would raise very serious questions

in the minds of many of us with respect to our ability to support

this legislation.

Ambassador BARSHEFSKY. If I may say in connection with both

countries, because I think it is probably hard to avoid the comparisons, I would prefer to answer it straight on. The question is how

one builds internal momentum and a larger internal dynamic for

reform in a country. We know from experience it is very difficult

to change countries from the outside if there is not inside the country a critical mass of reformers in order to speed the process, inVerDate 11-MAY-2000 11:32 Mar 13, 2001 Jkt 069535 PO 00000 Frm 00014 Fmt 6633 Sfmt 6633 F:\WORK\69535 HINTREL1 PsN: HINTREL1
9

deed to generate the process, of reform. Integration into the global

community is the way in which this Administration has decided to

approach that problem.

It comports in the case of China with the views of such respected

dissidents as Martin Lee and Bao Tung and Dai Ching and any one

of a number on the ground in China who believe that integration

into the global community will further the process of internal reform, such as Dr. Que has indicated similar views in Vietnam. We

believe that this is really the best way to approach the problem.

Isolation, whether of China or Vietnam, tends to increase repression, tends to decrease the accountability——

Mr. LANTOS. I know my time is up, but since you have used the

world ‘‘isolationism,’’ I have to respond to that. Those of us who disagree with the Administration’s policy are not recommending either

isolating China or isolating Vietnam, but of using our enormous leverage to improve the human rights condition.

Mr. BEREUTER. I thank the gentleman. And I thank the gentlewoman, the Ambassador, for her response. This is of major interest

to everyone of us, so if you wish to extend your remarks in written

form, it certainly would be most welcome.

Ambassador BARSHEFSKY. Thank you very much.

Mr. BEREUTER. I would like to call on the gentleman from California, if he has questions under the 3-minute rule.

Mr. ROHRABACHER. Yes. I associate myself with Mr. Lantos, especially with his last observation, that with this Administration every

time that we insist that there be some consideration of human

rights given to various trade issues with dictatorships and tyrants,

we always are thrown back with it is either isolation or, you know,

some sort of engagement that does not include human rights. I resent that, and I think that Mr. Lantos put that very well..

Under the agreement that you are proposing today, or that we

have negotiated with Vietnam, will the tariffs be the same on our

products going in as their products coming here?

Ambassador BARSHEFSKY. No. Our tariffs are among the world’s

lowest, so our tariffs will be lower than their tariffs.

Mr. ROHRABACHER. Substantially lower than their tariffs?

Ambassador BARSHEFSKY. Likely so, but that is the case with respect to our relations with much of Europe as well.

Mr. ROHRABACHER. OK. You are saying with this dictatorship,

we are going to really influence them to go in the right direction

by letting them ship in their goods to our country with a dramatically lower tariff than they are permitting our goods to flow into

their country. I think people look at us as being rather stupid for

making such an agreement.

Ambassador BARSHEFSKY. If I can make a comment on the question of human rights, we have had a substantial human rights dialogue with Vietnam for the past 8 years.

Mr. ROHRABACHER. Ma’am, I can’t let you go on with my time.

I only have 3 minutes. You want to put a statement about that in

the record, that is fine.

Let me ask a little bit about will it still be illegal under the new

agreement for anyone in the Vietnamese Government to release

economic information? That now is a criminal offense in Vietnam.

10

Ambassador BARSHEFSKY. That I would have to get back to you

on. I don’t know the answer.

Answer: We are not aware of a statute in Vietnam that makes it a criminal offense to release economic information. Regardless, this agreement addresses this

issue by obligating Vietnam to ‘‘provide nationals and companies of the other Party

(i.e., the United States) with access to data on the national economy and individual

sectors, including information on foreign trade.’’ (Chapter VI—Transparency Related

Provisions and Right of Appeal, Article 2)

Mr. ROHRABACHER. Does this agreement include—will it result in

the fact—in some type of taxpayer subsidies in the form of loan

guarantees through Export-Import Bank or OPIC that would be

made available to this Communist dictatorship, to businessmen

who are building factories in Vietnam?

Ambassador BARSHEFSKY. The President has waived JacksonVanik, which entitles Vietnam to OPIC and Eximbank financing,

and the Congress has not overturned that decision.

Mr. ROHRABACHER. Right. And this agreement then sort of puts

that in cement? Make that law?

Ambassador BARSHEFSKY. No, this agreement does not—well, do

anything until Congress approves it.

Mr. ROHRABACHER. Correct. But it will make that a part of the

law permanently.

Ambassador BARSHEFSKY. It will make sure that those remain

available.

Mr. ROHRABACHER. OK. Let’s see. We will end up with a Communist dictatorship and give them the right to export into our

country at lower tariffs than they will permit our products to go

into their country, plus we are going to subsidize American businessmen to set up factories in their country with taxpayer money.

I don’t think that the Communist dictators are going to miss the

message about that at all. They are probably going to think that

we are a bunch of saps, and I do, too.

Mr. BEREUTER. The time of the gentleman has expired.

The gentleman from Florida Mr. Davis is recognized.

Mr. DAVIS. Thank you, Mr. Chairman, and welcome, Ambassador

Barshefsky. Could you elaborate a little bit on what you see as the

condition of the rule of law today in Vietnam and how you see that

being influenced by this trade agreement once it is ultimately approved by Congress?

Ambassador BARSHEFSKY. The condition of the rule of law is very

weak; the arbitrary exercise of government power, unfettered bureaucratic discretion, a nontransparent trade and economic regime,

an economic regime, indeed, which is in need of substantial restructuring.

Under this agreement, Vietnam will have to make transparent a

number of things it has never made transparent before; for example, laws and regulations, advance notice of laws, the uniform application of the trade regime. These things are very basic to us, but

do not exist today in Vietnam.

We need to build legal institutions in Vietnam. This is a very

long-term prospect. And we need to expect Vietnam to adhere to

the kinds of commitments it has made with respect to transparency

and the initial rule of law issues to which it has committed in the

agreement.

11

This will require substantial technical assistance. We are working now with USAID, which will assist Vietnam in technical terms

in implementing the commitments including with respect to transparency and the rule of law-related issues. But the creation of a

rule of law in Vietnam is going to take a number of years.

Mr. DAVIS. Could you talk about what you think will be the

major issues we need to be bird-dogging as we oversee implementation of the trade agreement?

Ambassador BARSHEFSKY. I think we will have to pay close attention to the entirety of the agreement. Vietnam has never entered into an agreement of this comprehensive nature before with

any country in the world, Communist or non-Communist. This

agreement will be new to them. Of course, the NTR that would be

granted by Congress when it approves the agreement is annual

only, and this will give the Congress the ability to review Vietnam’s implementation step by step. The agreement itself is also

subject to renewal after 3 years. That is to say, the agreement expires in 3 years until it is affirmatively renewed. That will also provide us very positive opportunities to assess implementation.

Mr. DAVIS. OK. Thank you.

Thank you, Mr. Chairman.

Ambassador BARSHEFSKY. Thank you.

Mr. BEREUTER. Thank you very much, Ambassador. I appreciate

your remarks about the two latter points.

Chairwoman Ros-Lehtinen is waiving temporarily her time for

questioning, and we will move to Mr. Royce, the gentleman from

California.

Mr. ROYCE. Thank you, Mr. Chairman. I want to thank you, Mr.

Chairman, and I want to thank our witnesses for this critical hearing.

Ambassador Barshefsky, before getting to the agreement with

Vietnam, I would like to briefly discuss the Africa trade bill, because within the next few weeks there are some decisions to be

made. The bill is now law, and, of course, it means a great deal

to Africa. And, Ambassador, this legislation was written in a way

that gives trade benefits to those African countries that are reforming their economies to be good trade investment partners with us.

The Administration is charged, in consultation with Congress,

with determining which countries are making this progress, and

that is the same type of progress we are pushing for in Vietnam.

And I have written you expressing my concerns, and now I would

like to raise one country in particular, and that is Zimbabwe.

Many of us have sadly followed Zimbabwe’s implosion as the government of President Mugabe has made war on its economy,

launching a systematic attack on the property rights of a wide

array of Zimbabweans. And today in the Washington Times there

is an account by a commercial farmer who is leaving her land, having seen it looted and illegally taken over. And she writes, ‘‘Commercial agriculture in Zimbabwe seems to be drawing to a close.’’

This is very true. The farms are all closing. ‘‘And this will be devastating to the country including its food security.’’ Maybe our influence is limited, but I know that now, now is certainly not the

time to be validating this economic destruction by qualifying the

12

country for the African Growth and Opportunity Act. And that is

more of a statement than a question, but I welcome any response.

My other question concerns the trade agreement with Vietnam

that we are looking at, and I wanted to ask there, what areas do

you expect Hanoi to have the most difficulty with politically and

logistically in implementing? Do you expect to see trouble from

Hanoi in some of the implementation process?

Thank you, Ambassador.

Ambassador BARSHEFSKY. Congressman, I do not have any specific comment to make about Zimbabwe. The interagency team on

AGOA eligibility is meeting even as we speak. Final decisions on

countries have not yet been made. And, of course, we merely provide the President with recommendations, and ultimately he will

make decisions as to eligibility.

Certainly I am pleased to directly look into the question of

Zimbabwe and get back to you on that.

Mr. ROYCE. I appreciate that, because my concern was that it

would be in consultation with Congress, and I very much appreciate you doing so.

Ambassador BARSHEFSKY. I understand that. Absolutely.

[The information was not provided.]

With respect to difficulties Hanoi may have, as I said to Congressman Davis, I think we are going to have to watch implementation overall very, very carefully. I think it is to be expected, particularly in a Communist country, that liberalization related to information technologies, for example, telecom or the Internet, which

this agreement also covers, are areas of the agreement that will

have to be very, very carefully monitored and scrutinized. To be

sure, Vietnam has several, for example, cybercafes, but we are talking about quite a bit broader liberalization than that in the agreement.

But in general I would say we are going to have to watch implementation very, very closely. Annual congressional review will be

of great, great importance in that regard. The 3-year review of the

agreement will be of great importance in that regard.

Mr. BEREUTER. Thank you. The time of the gentleman has expired.

The gentleman from North Dakota Mr. Pomeroy is recognized.

Mr. POMEROY. Thank you, Mr. Chairman, and I want to congratulate you for your legislative victory in the House this morning

passing the overseas cooperative bill, which encourages the use of

co-ops in expanding overseas development activities.

Mr. BEREUTER. And I thank you for being an original cosponsor.

Mr. POMEROY. My pleasure. That is a good bill, and I am hoping

that is going to make it this session yet.

Ms. Barshefsky, it is go good to see you again. My brother the

summer before last participated in a U.S. Commerce Department

training session for insurance regulators in Vietnam. He serves

presently as the insurance commissioner in North Dakota. He came

back quite enthused about the potential for the services market

there when we get a fair shot at that market. Would you have a

comment on that?

Ambassador BARSHEFSKY. I think he is absolutely right to be enthused. The services markets in Vietnam are grossly underVerDate 11-MAY-2000 11:32 Mar 13, 2001 Jkt 069535 PO 00000 Frm 00018 Fmt 6633 Sfmt 6633 F:\WORK\69535 HINTREL1 PsN: HINTREL1
13

developed and underfunded. There is a lack not only of capital,

there is a lack of expertise. There is a lack of information and

know-how with respect, for example, to what a modern financial instrument looks like or what modern insurance looks like. So there

is very substantial, substantial opportunities.

Mr. POMEROY. With this session winding down, this may be my

last chance to publicly commend you in a hearing setting for the

job you have done as our trade representative. You have been a tenacious advocate, and the howls from some of our trade competitors of the concessions you have wrought at the table I think shows

third-party validation of your effectiveness.

I would be remiss in this last exchange potentially with you not

to mention the North Dakota Wheat Commission 301 petition filed

with you on September 8. Just a little background. Congressman

Nethercutt, myself, many others, both parties, have urged that the

petition be acted upon and an investigation launched. Commission

301, as you know, was designed to combat unjustifiable, unreasonable, and discriminatory acts, and, in that petition, we outline to

the extent we can pull together anecdotal evidence that says precisely what is occurring.

Of course, the backdrop of this is very severely depressed markets and horrible grain prices, and we do not think as we go up

against the Canadian Wheat Board that the trade competition has

been fairly conducted.

We think that an investigation to the full extent of the Canadian

Wheat Board’s discriminatory pricing activities is required. I would

remind you of their adamant refusal to allow the full audit that

you and I have urged over the last 2 years. Like I always say, if

they do not have anything to hide, why are they so adamantly opposed to the audit? The investigation would allow us to unilaterally

proceed to give the Canadian Wheat Board the look that it deserves. I hope with your help we can take a strong stand against

these unfair trade practices and support our farmers and move forward to launch the investigation.

Do you have a comment as to the status of the Administration’s

review at this time?

Ambassador BARSHEFSKY. Once a 301 case is filed, it goes to an

interagency group which looks at the allegations, and which gives

counsel and the petitioners an opportunity to appear before the

interagency group to discuss the case. The interagency group will

make a recommendation to me as to the disposition of the case,

that is whether we initiate it or not, by mid-October, and I then

need to make a decision by October 23.

Certainly we are very familiar with the activities of the Canadian Wheat Board. You and I have discussed many, many times

our mutual frustration at the secrecy surrounding Wheat Board

transactions and the fact that state trading in this sector produces

extremely negative consequences for our producers.

I look forward to receiving the interagency recommendation and

am certainly delighted to speak with you about it as well.

Mr. POMEROY. Thank you very much.

Ambassador BARSHEFSKY. Thank you.

Mr. BEREUTER. Mr. Pomeroy, I join you in your commendations

for the public service that Ambassador Barshefsky has rendered

14

and her tenaciousness as a negotiator, and, like you, I just handed

her a letter about nontariff barriers in the Philippines about American meat exports. So I have your same concerns about the Canadian Wheat Board.

The gentlewoman from Florida, the Chairlady of the IEPT Subcommittee, is recognized.

Ms. ROS-LEHTINEN. Thank you. I will make it brief because I

know the Ambassador’s time is limited. In your testimony you refer

to the commitments that Vietnam will undertake. What commitments and steps has this country already taken and truly adhered

to that raises investor confidence in a country with a Communist/

Socialist economy? How can the U.S. investor really feel secure

about property rights, about deregulation, about rule of law, avenues for redress?

Ambassador BARSHEFSKY. I think U.S. investors need to proceed

with great caution and care. Vietnam was making some important

progress in the early 1990’s to roughly 1995, 1996, in terms of economic reform, at least passing some rudimentary but important

laws with respect to the operation of companies, with respect to investment, with respect to what they call equitization, which is privatization.

When the Asian financial crisis hit, Vietnam was severely and

negatively impacted because about two-thirds of all of its trade and

all of its investment is with the rest of Asia, and, of course, the rest

of Asia was not trading, and they were not investing. So Vietnam

experienced rapid outflow of funds and very, very poor export performance, a slowed economy, and that then slowed the reform effort, the passage of laws and so on.

There is much to be done in Vietnam. It is a country in which

an American businessperson would be advised to proceed slowly

and very, very cautiously.

Ms. ROS-LEHTINEN. Thank you very much.

Thank you Mr. Bereuter.

Mr. BEREUTER. Thank you, and I thank all of the Members. Ambassador Barshefsky, thank you very much for your testimony. You

will be pleased but not surprised to know that the wheels of the

Senate debate are grinding more slowly than projected, so you will

be in time.

Ambassador BARSHEFSKY. Thank you so much, Mr. Chairman.

Thank you, Madam Chairwoman.

Mr. BEREUTER. I would like now to call the second panel of distinguished witnesses from the Department of State and the Department of Commerce. Representing the Department of State is Assistant Secretary of State for East Asian and Pacific Affairs, Mr.

Stanley Roth. Mr. Roth is a valued and frequent witness before the

Subcommittee and has focused on United States-Vietnam relations

in many years in many capacities in the State Department, the

Pentagon, the private sector, the NGO community, and here on the

Subcommittee itself.

Representing the Department of Commerce is Deputy Under Secretary of Commerce for International Trade Timothy Hauser. Mr.

Hauser is a 21-year employee of the Department, who serves as

Chief Operating Officer of the International Trade Administration

[ITA]. He oversees the day-to-day operation of the ITA and its

15

trade promotion, trade policy, and trade law enforcement activities.

He is the right person to have here today.

Gentlemen, as is consistent with our policy, your entire written

statements will be made a part of the record. You may proceed as

you wish. I would appreciate it if you could keep your oral comments to 10 minutes apiece.

Secretary Roth, you are recognized first.

STATEMENT OF HON. STANLEY O. ROTH, ASSISTANT SECRETARY FOR EAST ASIAN AND PACIFIC AFFAIRS, U.S. DEPARTMENT OF STATE

Mr. ROTH. Thank you very much, Mr. Chairman, for the introduction. At some risk, I think, Madam Chairperson, as well, at

some risk I am just going to submit my written testimony for the

record without reading it, because listening to the statements and

questions that were made, I don’t think the largely historical materials that I provide in my statement focus on the key issues here

of interest to the Members.

And so instead I would really to respond to some of the themes

that have already been said.

First, I think there is a bit of disconnect between what we are

saying and a lot of what we are hearing back in terms of what is

a bilateral trade agreement. The bilateral trade agreement, if approved, does not make Vietnam an ally. It is not an ally. No one

in the Administration claims it is an ally. A bilateral trade agreement is not a reward. A bilateral trade agreement is a benefit to

the United States and to our exporters. It improves the terms with

which we can do business with Vietnam, access to the market. If

they do not abide by it, as Ambassador Barshefsky said, we will not

renew it. There is leverage for implementation, but it is not a gift.

In fact, it is not special, it is the basis for NTR or normal trade

relations. It is an agreement that is essential with every country

with whom we have normal trading relations, and so it is a prelude

if the Congress should decide to approve NTR at some future point

after this agreement is submitted. So this not an unusual step or

extraordinary step, it is a normal commercial step. The significance

comes from the fact that in the Vietnamese context, given how far

back they have been in terms of their economic procedures and the

access they have provided us commercially, it will require an enormous amount of change on their part, much more change, I should

say, on theirs than on ours. But this is not a gift or reward.

Second, it is not the Good Housekeeping Seal of Approval. I

think, as Ambassador Barshefsky said, we have been very blunt in

criticizing Vietnam in those areas where we think Vietnam should

be criticized. I don’t think anybody could read the human rights report or the recent report on religious freedom and say that we had

coddled Vietnam or failed to call a spade a spade. We did.

We do not see this vehicle as the only means of policy toward

Vietnam. We have many other tools with which we address issues,

including, for example, the human rights dialogue that was referenced on the area of human rights.

Third, I think that we haven’t really examined trends as opposed

to a snapshot. For all the concerns about Vietnam’s human rights

record, and they are legitimate concerns that I happen to share, I

16

also strongly believe that the human rights situation in Vietnam

is considerably better than it was 10 years ago or 20 years ago, and

that there have been positive developments, even though they are

not enough. If you ask me do I agree with the characterizations

that have been made, sure. Is there freedom of speech, press assembly across the board? Of course not. Severe problems with freedom of religion? We have already said that.

But if you ask me to compare it with where it has been before,

if I look at dissident releases, for example, they would not have

happened in the past. If I look at the very large religious rallies

that were held over the past year, 200,000 at one, 500,000 at another, that would not have happened in the past. As Ambassador

Peterson has said, attendance in churches is up. It is not enough.

That does not mean there is religious freedom. But there have been

many positive developments in some of these areas, and I don’t

think we should have a hearing go by without acknowledging that

there has been progress in some areas. We have gotten some dissidents out.

There now have been 60 strikes, even though the system in Vietnam does not theoretically allow strikes, that were allowed to take

place last year. That is not enough. That is not my idea of labor

rights under international standards, but that is a huge change

from where we have been in the past.

I think you can go on and on, and I don’t think I need to belabor

the point other than to say take a look at the trends.

I think I make exactly the same point with the POW–MIA issue.

I think we have made enormous progress toward obtaining the fullest possible accounting. That does not mean that we have gotten

all of our questions answered, including the one that you, Madam

Chairwoman, have raised. We have not gotten the answer yet. Ambassador Peterson personally put that question to Vietnam and has

not gotten a satisfactory answer, and we will raise it again.

We are not claiming it is 100 percent every single thing that we

asked for is there, but there has been a consistent pattern of cooperation on a wide variety of issues with enormous progress having been made, and I think that has been detailed at great length.

I do not need to do that now.

I think, finally, we haven’t taken into context what is Vietnam’s

relationship with the rest of the world and how does that relate to

our issues? I think it is very important to note that over the past

few years, Vietnam has been admitted into ASEAN. It is, in fact,

the Chairperson, Chairman, this year of ASEAN. Will be holding

the annual ASEAN regional forum meeting there. It is in APIC. It

is a member, participating widely in the Asia-Pacific area, quite

different from where Vietnam historically has been. All of our

friends and allies in the region are working with Vietnam. We partake in many international meetings with them. I think that there

is little chance if the United States chose to try to isolate itself

from Vietnam that, in fact, any other country or any other major

country would support us, and that is where I think the regional

context plays as well.

So, overall, I guess what I am pleading for is not to say to you

that everything is terrific, that Vietnam is a model whether of economic good governance or human rights practice. Of course it isn’t.

17

But rather, look at how far Vietnam has come, the successes we

have had with the policy to date and where we hope to get in the

future, and that is where the BTA, or bilateral trade agreement,

fits in.

And that is the final point I want to emphasize. There is frequently misunderstanding, whether we are talking about China,

Vietnam, or other places, when the Administration makes the case

that if this agreement goes into effect and is enforced, that over

time it will lead to an improvement in the situation. I have many

times been questioned how come the situation in China is not better 1 year or 2 years later. I want to be clear about what we are

suggesting. We are not suggesting that these agreements, particularly trade agreements, are immediate mechanisms for improvements on human rights, that it is any kind of a quid pro quo that

will lead to dramatic immediate changes.

What we are suggesting is that they set the stage for systemic

changes, that the kind of reforms that are called for under this

agreement, the kind of openness that has to take place, the greater

accountability, the greater stress on rule of law, plus the greater

exposure to the West as Vietnam trades more, as it modernizes and

sends more people to be educated, we are suggesting that over time

all of those factors will have an impact on the political process in

Vietnam.

That is not a commitment that I can codify for you and say 2

years from now there will be 20 percent less dissidents or anything

like that. What we are saying, it is a process that should yield desired results over a period of time.

Why don’t I stop there, Mr. Chairman.

[The prepared statement of Mr. Roth appears in the appendix.]

Mr. BEREUTER. Thank you, Secretary Roth.

Secretary Hauser, we are pleased to hear from you now.

STATEMENT OF HON. TIMOTHY J. HAUSER, DEPUTY UNDER

SECRETARY FOR INTERNATIONAL TRADE, U.S. DEPARTMENT OF COMMERCE

Mr. HAUSER. Thank you, Mr. Chairman, Madam Chairperson,

Members of the Subcommittees. Thank you for the opportunity to

appear here today on behalf of the Department of Commerce.

Ambassador Barshefsky and Assistant Secretary Roth have addressed many aspects of our evolving bilateral relationship with

Vietnam. Let me focus briefly, if I may, on three main points about

the economic and commercial aspects of this relationship.

First point, Vietnam is changing in fundamental ways. U.S. policy is providing both the catalyst and the framework for this sea

change. The catalyst is the promise of economic success. The framework is the bilateral trade agreement.

I have been watching this process of change closely since the

spring of 1996 when I led the first U.S. Government trade mission

to Vietnam. More recently, just last month, Robert Mallett, our

Deputy Secretary at Commerce, experienced this same palpable energy of change when he went to Vietnam.

Some of the changes going on are extremely visible. One example

is Vietnam’s first security exchange. The Deputy Secretary visited

18

that exchange, which was some 8 years in the making, just days

into its operation.

Another example which I find fascinating was the fact that he received a PowerPoint presentation from the Vice Chairman of the

People’s Committee of Ho Chi Minh city of his vision of a software

city that he plans to create with the help of an American company.

But perhaps the more significant changes are not quite as visible

as these. One example of this, and perhaps the most telling, was

our delegation’s roundtable discussion last month with young Vietnamese entrepreneurs in Ho Chi Minh City. The participants were

people who were confident in their ability to compete in the global

marketplace and who look forward to an environment that would

allow them to do so.

I would submit, Mr. Chairman, that these represent real

changes, none of which I saw 4 years ago during my initial trip to

Vietnam.

Second, I believe there is a renewed enthusiasm for business in

Vietnam. We at the Department of Commerce, as part of our daily

work, talk with a broad range of American business executives. We

have also talked extensively with Vietnamese officials. To a person,

they are extremely enthusiastic about the signing of the bilateral

trade agreement.

This renewed enthusiasm is reminiscent of some of the initial euphoria over the lifting of the embargo and the establishing of diplomatic relations in 1994 and 1995. I was still seeing this enthusiasm when I was there in 1996, and we are seeing it again today,

but I think in a more grounded way. As they were then, American

companies are attracted to this new frontier by the very attractive

fundamentals of a young and industrious population and a good

base of natural resources.

Over the intervening 4 years, it is true that some of the companies became disillusioned by the difficulty of doing business in Vietnam. The cost of doing business there is extremely high and government policies there at times have been schizophrenic. The Asian

financial crisis further compounded the difficulties for all parties

involved.

But I think the renewed enthusiasm we are seeing today is fundamentally different from the high expectations of the first wave.

Our firms are taking a second, more realistic, look at this challenging market. They have gained in-country experience over the

past 5 years which now gives them an optimistic but realistic view

of commercial opportunities in Vietnam, and the bilateral trade

agreement has addressed many of their uncertainties.

My third point, this is not going to be an easy process, and the

Vietnamese will need our assistance. Vietnam is still clearly a

country in transition. Much work remains to be done on the implementation of the bilateral trade agreement. Progress will not be

easy, fast, or necessarily even smooth, but I believe it will be

unstoppable.

Vietnam is now on the path toward integration into the global

economic community. Signing the BTA was a significant step down

that path, but implementation is the key to that journey.

We at Commerce will work closely with USTR, the State Department, and the other agencies of the executive branch and the ConVerDate 11-MAY-2000 11:32 Mar 13, 2001 Jkt 069535 PO 00000 Frm 00024 Fmt 6633 Sfmt 6633 F:\WORK\69535 HINTREL1 PsN: HINTREL1
19

gress to monitor implementation of the agreement. As many in

Congress have noted, it is important to do the hard work of monitoring all of our trade agreements and determining the degree to

which foreign countries comply with them.

In addition to monitoring implementation, we at Commerce will

also help American companies take advantage of the agreements’s

market opening opportunities through a variety of initiatives. But

we also need to help the Vietnamese make the agreement work.

During the bilateral negotiations, our negotiators told the Vietnamese that the United States would provide technical assistance

to help them implement the agreement. Deputy Secretary Mallett

reaffirmed this commitment during his visit last month.

We at Commerce have already begun a range of technical assistance initiatives in a number of disparate areas. For example, as

early as 4 years ago I signed a memorandum of cooperation on

commercial law development with the Vietnamese. Since then, we

at Commerce have provided assistance in other areas as in insurance regulations, standards workshops, intellectual property enforcement training, as well as meteorological and fisheries cooperation.

To date, many of these efforts, though positive, have been on an

ad hoc basis. We need to do more. I think we need to work together

both in the Administration and with the Congress to develop a

comprehensive, targeted technical assistance program which could

be a major investment in the new relationship.

With that, Mr. Chairman, let me stop. I would be pleased to take

your questions and those of the Subcommittee Members.

[The prepared statement of Mr. Hauser appears in the appendix.]

Mr. BEREUTER. Under Secretary Hauser, thank you very much

for your testimony as well.

We will now proceed, of course, under the 5-minute rule as usual.

The gentlewoman from Florida, chairwoman of the IEPT Subcommittee, has left to meet with officials about a plane crash involving her constituency, and we will submit questions for her

under general leave. I will start the questioning under the 5-

minute rule.

Secretary Roth, I wanted to ask your opinion or the State Department’s judgment, if there is such a judgment, whether you

think Vietnam’s decision to sign the trade agreement is an indicator that Vietnam’s reformers have broken the policy paralysis in

the Politburo, or is it a sign that conservative hard-liner efforts are

simply trying to co-opt the reform agenda?

Mr. ROTH. I hope that it is the first. I view it more of an ebb

and flow, not that it is one, you know, final victory. I think there

is a struggle going on within the regime in Vietnam between reformers and those opposed to reform and that it waxes and wanes

at various points.

We saw this in the negotiation of the agreement itself, the fact

that we thought we had the deal and then the fact that it did not

happen and then the fact that we got the deal with concessions

made that weren’t available before suggest to me that this is still

being fought out within there. But now that it is signed in writing

and needs to be implemented I hope that the impetus or the

strength will go to the reformers.

20

Mr. BEREUTER. Undoubtedly, it delayed or slowed down the

course of the negotiations.

Secretary Hauser, you have mentioned the kind of things that

you have had ongoing to try to ensure that we have better record

of implementation of the trade agreement once it is signed, approved by Congress; and you mentioned many of these things are

really ad hoc as opposed to a comprehensive policy.

Can you tell me anything more about how you might move to a

more comprehensive policy? What the components of it would be?

Whether you need additional resources to do that? And if so—as we

did in the case of China, if so, are they available within the Commerce Department or do they depend upon, in part, a budget request for Department of Commerce for fiscal year 2002?

Mr. HAUSER. Mr. Chairman, let me differentiate. What I think

I said was ad hoc was some of our efforts at technical assistance,

and I think we are taking positive steps across the Administration

in that regard. I know AID has made resources available for two

people to work with the Vietnamese Government on implementation of the bilateral trade agreement. We have ongoing efforts at

technical assistance. In fact, as Congressman Pomeroy had said, we

had some of our experts from the insurance industry over in Vietnam. In fact, we have another team on insurance there this week.

Our Commissioner of Patents and Trademarks, Under Secretary

Dickenson, I believe, is going to be in Vietnam within another week

or 10 days, again, to bring some existing resources efforts to focus

on how we can help the Vietnamese live up to the agreement.

On the issue of implementation of the agreement, we have asked

the Congress for some assistance across the board in the U.S. Government in the fiscal 2001 budget.

Mr. BEREUTER. But not identified specifically for Vietnam?

Mr. HAUSER. Vietnam, among a number of countries. We are

looking for increased resources, obviously, for key areas like China,

Japan, Europe. I think there is also a need to be putting more resources on this particular issue as this agreement comes forward.

Mr. BEREUTER. Secretary Roth, in the past, Vietnam has treated

United States citizens of Vietnamese background differently and

more negatively than other United States citizens. Given that increased economic and trade ties will likely increase travel to and

business dealings with Vietnam by the part of United States citizens of Vietnamese origin, what steps will our government take to

end the kind of discrimination that seems to exist against Vietnamese Americans?

Mr. ROTH. First, one would hope that Vietnam itself would come

to recognize and see that Vietnamese Americans are a positive factor in terms of developing the relationship in their own economic

development.

Mr. BEREUTER. They should. It is logical.

Mr. ROTH. I think that over time that is likely to be the trend.

Second, we need to continue what we are doing, which is to press

extremely hard on every single case when we find examples of discrimination. I have spent hours in Ho Chi Mihn City, for example,

discussing consular access for Americans who have been detained

on criminal matters. I think we have to make it very clear that

there is no distinction in the minds of United States officials beVerDate 11-MAY-2000 11:32 Mar 13, 2001 Jkt 069535 PO 00000 Frm 00026 Fmt 6633 Sfmt 6633 F:\WORK\69535 HINTREL1 PsN: HINTREL1
21

tween Vietnamese Americans and other Americans. That just has

to be a priority point when necessary. We have to get our Cabinet

officials to raise these cases until they come to accept it.

Mr. BEREUTER. Thank you, Mr. Secretary.

My time has expired. The gentleman from Florida, Mr. Davis, is

recognized 5 minutes.

Mr. DAVIS. Thank you, Mr. Chairman.

Secretary Roth, how would you describe the current state of affairs as far as the government’s level of respect for political and

civil rights of its citizens in Vietnam?

Mr. ROTH. Minimal, I guess I would have to put it. As I mentioned before, one can’t talk about a whole lot of freedom of speech,

press, assembly and the like.

At the same time, changing. That I think you see signs that you

did not see before. I have been traveling to Vietnam for the past

20 years, and it is different in many ways. It is inconceivable to

me to see a demonstration not organized by the government. Now

you can see that there were demonstrations outside their parliament when it meets on various issues. There is occasional criticism, not systematic; and sometimes there is retaliation in the

press. It is usually oblique, but the press is different than it had

been before, even though it is not nearly good enough.

There has been—in other words, it is episodic, but there is some

signs that there is a gradual loosening. But there has been no conceptual breakthrough yet. I don’t think we can say yet that Vietnam is on the path to democracy.

Mr. DAVIS. How do you see the implementation of this proposed

trade agreement influencing trends in that regard?

Mr. ROTH. Well, I tried to make the point before that I think that

over time—and I am not necessarily saying a very short, immediate period of time. I think that as trade increases, as there is

more exposure with the United States and the rest of the world,

as different standards are used in terms of commercial law, in

terms of transparency, in terms of accountability, I think all of that

has to have an impact and spillover effect into the political side of

the equation in Vietnam.

It is not a one-to-one correlation, which is why I am trying not

to be absolutely—trying to not overstate and say that this guarantees, the BTA, that Vietnam will be a democracy or our type of

guys or our type of system in another 5 to 10 years. But I think

the trends that it promotes have to be helpful in terms of the kind

of openness that we all want to see.

Mr. DAVIS. Thank you.

Mr. Hauser, Representative Rohrabacher raised a legitimate

point earlier and that was the net benefit strictly on the economics

to the United States of this proposed agreement. And Ambassador

Barshefsky made the point that in the case of some exports to Vietnam currently there are no tariffs imposed by the United States.

I think that is the case with shrimp and coffee, for example, two

major export items.

Could you elaborate a little bit more on what the net benefits are

to the United States as far as the tariff reductions both on imports

and exports under the agreement?

22

Mr. HAUSER. I think you would have to look, Congressman, be- yond just the tariff reductions. I would note that I believe something like four-fifths of the some-250 line items that are being reduced in the Vietnamese tariffs are for American agricultural products, which we know are very competitive and in search of world

markets. So I think the prospects in those sectors—and, again, I am the Department of Industry and Services, but my colleagues at

Agriculture tell me that soybeans, soybean meal, bulk cotton,

wheat, wheat flour, livestock and a number of other agricultural

products would benefit from this market opening. In addition to the tariff reductions in the agreement, the provi- sions on service industries, for example, go a tremendous way to

meeting the concerns that we have heard from the American business community over the years. In 1996, for example, I met with

a number of U.S. insurance companies, American banks that at the

time were able to have a branch operating in Hanoi, and the big

deal for them was to get permission, which they were not getting,

to open a branch in Ho Chi Minh City. Those kind of restrictions

on doing business in Vietnam are eliminated in the process of the

trade agreement. There had also been very strict limitations in terms of degree of

foreign ownership of particular sectors, whether it is issues in

telecom, insurance or any of the other service sectors. The agreement as negotiated, and if it is approved by the Congress, will over

time allow increasing American ownership, increasing participation

in these sectors.

Similarly, the business facilitation provisions, the transparency

provisions that are within the six major categories Ambassador

Barshefsky discussed are all to the benefit of American firms seeking to do business in the market. So it goes beyond the tariffs, Congressman.

Mr. DAVIS. One last question, Secretary Roth, a question that

would probably have been better directed to Ambassador

Barshefsky. As this Congress begins to more aggressively tackle

the human rights issues, the labor and environmental issues that

are invariably associated with trade, as evidenced by some of the

efforts of our Chairman here today and Congressman Levin on the

China bill, to what extent were those subjects brought up on the

discussions of the bilateral agreement here and to what extent do

you see that as being a part of Congress’ consideration when we

take up Fast Track on bilateral next year?

Mr. ROTH. I really can’t address the first part of the question,

since I was not part of the negotiations, did not sit in on them and

haven’t read the transcripts, but I will get you an answer for the

record.

Answer: Concerned by Vietnam’s poor human rights record, this Administration

has worked consistently to engage Vietnam on these issues. For 8 years, we have

pressed for improvements through high level meetings, everyday activities by Embassy personnel, and our annual human rights dialogue. We have achieved some

progress, although significant problems remain.

The Bilateral Trade Agreement with Vietnam should facilitate additional progress

on both human rights and labor conditions. The Agreement grants Vietnam’s citizens significant rights to trade and distribute goods and services. Over time, increased trade should allow Vietnamese citizens to determine their economic destiny,

leading to a broader expansion of individual liberty. Furthermore, we are confident

that Vietnam’s commitments to improve the rule of law in commercial transactions

23

will eventually lead to the extension of the rule of law to other, non-commercial activities in Vietnam.

We have clearly not finished the job. We will continue to press for progress until

Vietnam meets internationally accepted standards for human and labor rights.

Environmental issues did not figure prominently in our BTA negotiations but they

figure prominently in our bilateral relations. The USG is working with Vietnam on

revision of its environmental law, improvements in air quality, coral reef preservation and coral reef trade management, and watershed management to mitigate

floods. Vietnam has also agreed to conduct joint scientific research on the epidemiological and environmental effects of exposure to Agent Orange/dioxin. We fully expect the BTA to bring to Vietnam the latest U.S. technology and practices related

to the environment.

On the second part of your question, I think it is quite clear that

the Administration has heard the message, not only from the Hill

but from segments of American society, that it would like to see

more attention being given, more emphasis in some of our trade

agreements on environment, human rights and labor issues; and I

think that has already surfaced as something that the Administration would like to do in the future as we look forward. So we know

this is coming in terms of congressional consideration.

At the same time, I think it is important, in terms of the consideration of this particular agreement, that we not hold Vietnam to

a different standard than we have held many other countries in

their bilateral trade agreements and, in other words, not change

the rules retroactively on them. We did negotiate an agreement,

and I think we should go ahead and seek to get it approved.

Mr. DAVIS. Thank you. Thank you, Mr. Chairman.

Mr. BEREUTER. I will advise we probably will have a second

round.

The gentleman from California, Mr. Rohrabacher, is recognized

for 5 minutes.

Mr. ROHRABACHER. Thank you very much.

Whereas this is likely to be Mr. Roth’s last appearance before

this Subcommittee of this Congress, anyway——

Mr. ROTH. No more hearings?

Mr. ROHRABACHER. No more hearings—I would like to ask him

a little bit about some testimony that he gave prior to this. I seem

to remember that you had been downplaying at the last hearing

the last time we were together my warnings about the military escalation in the South China Sea. I have submitted for the record,

Mr. Chairman, an article from a July 26 article from the Chinese

army newspaper characterizing their facilities in the Spratly Islands as modern fortresses at sea. Mr. Roth, would you say that

your characterization of my warnings the last time you testified before this Subcommittee are more accurate than the Chinese characterization of their modern fortresses at sea in the Spratly Islands?

Mr. ROTH. Absolutely. I would stand by what I said. Common

sense suggests if you look at the pictures of the facilities that they

are hardly modern fortresses.

Mr. ROHRABACHER. When was the last picture that you saw of

those facilities?

Mr. ROTH. A couple of months. I should say—— Mr. ROHRABACHER. Mr. Chairman, I would submit for the

record—do we have those pictures? We will submit for the record

those pictures, and they are modern fortresses with helicopter

landing pads and facilities for rocket launchers.

24

Go right ahead.

Mr. BEREUTER. Without objection, they will be made a part of the

record.

[The information appears in the appendix.]

Mr. ROTH. I think the interesting thing to note is, because of the

diplomatic pressure we have generated, China has now engaged in

what it said it would not do, negotiating with the other claimants

on a code of conduct; and that, I think, is significant if we get it;

and that the claimants are standing tough and insisting on construct freeze, no new facilities, denying Chinese fishing rights

until——

Mr. ROHRABACHER. As you know, up until now the Chinese have

not been willing to negotiate with the other ASEAN parties, claiming that all of the Spratly Islands belong to them..

Mr. ROTH. They are in negotiations, which is a major accomplishment.

Mr. ROHRABACHER. If indeed—we will wait and see if your optimism is justified.

Now, in terms of Vietnam, again, for the record let me point out

that what we have heard today is that we have an agreement that

will permit the North Vietnamese or the Vietnamese, I should say,

government, that dictatorship, to continue to have very high levels

of tariffs against American products, while our tariffs are going to

be substantially lower, perhaps very low in comparison.

Also, part of this agreement will be a subsidy to American businessmen who want to perhaps close factories here and open up factories in Vietnam, while our Ambassador, our trade representative

just stated that businessmen should be very cautious, very, very

cautious in doing business in Vietnam. Yet our agreement permits

Export-Import Bank, OPIC, and other U.S. taxpayers to subsidize

those businessmen in building those factories.

That does not seem like a good deal for America to me. It seems

to me that we have a terrible trade balance with Communist

China. It seems that we are setting up the same sort of incentives

for people to build businesses over there but not to sell U.S. products.

Mr. ROTH. I am baffled by your linkage between the BTA and

these programs. It is Jackson-Vanik which gives these programs.

We have these programs already. We do not have a BTA yet, and

we have these programs already. So I think that this has nothing

to do with BTA.

Mr. ROHRABACHER. Right. This does not lay the foundation for

our trading relationship for Vietnam in the future. Which I think

it does, and that, I think, is what we have heard today.

One last thing about the POWs which you have characterized as

their ‘‘cooperation.’’ Ambassador Pete Peterson when he was here

a month ago changed his position, by the way, I might add, when

the floor debate was going on, said they had cooperated. But afterwards, when he met with me, admitted that the Vietnamese Government has not cooperated with us in providing us the records

from prisons in which our POWs were being held. They haven’t

provided how much supplies or how many prisoners were supposed

to be there. They just have not.

25

Pete’s position is, which I imagine—and I am asking you, Mr.

Roth—is that the position of the Administration is that we do not

expect the Vietnamese to provide us the records from those prisons

because it is unrealistic for us to expect them to have those

records? Or, after having demanded to see those records for 10

years, that we still are asking for those records?

Mr. ROTH. Well, I think this is something that you may want to

pursue in more detail with DIPMIL than with me, since I don’t

work on it day to day. But having seen your exchange and heard

about it from Pete, what I have been advised is that it is the assessment of our experts that they do not have these records, and

after 25 to 30 years that they have long since vanished.

Mr. ROHRABACHER. Vanished?

Mr. ROTH. It is, further, their assessment that they probably

would not contain useful information if they had them.

Mr. ROHRABACHER. I think that the public will have to determine

whether we can characterize that position which you just articulated as something less stringent than holding their feet to the fire.

You might say we are letting them off the hook.

Mr. ROTH. You can’t demand production of documents that do

not exist, which is one of the problems we have had all along is

trying to figure out what does and does not exist. It is easy to say

you have to produce something, but if it isn’t there, and it is completely credible to me that it might not be there—— Mr. ROHRABACHER. Well, whenever something comes down to

giving them the benefit of the doubt whether those documents

exist, I guess it is better to give them the benefit of the doubt rather than worry about some POWs that have been murdered somewhere.

Mr. ROTH. We have gotten an extraordinary amount of documents from the Vietnamese.

Mr. BEREUTER. The time of the gentleman has expired. We will

come back to the gentleman if he wishes.

I would like to return under the 5-minute rule for a second

round.

Secretary Hauser, if the BTA enters into force, which sectors do

you think will benefit the most? That is my first general question.

And sort of subsets under it, one of the predictions of analysts

is that the first beneficiaries of the agreement, or the larger beneficiaries, initially at least, might be American investors versus

American—and multilateral investors, as compared to American

exporters. I wonder if I could get your reaction to that.

Second, you briefly discussed the areas, commodities products

and so on, where you think we might have the biggest natural benefits in terms of exports and suggested you were not an agricultural expert. I heard several things mentioned.

The quantitative restrictions, according to Chapter 1 of the

agreement, reduced a range of industrial and agricultural products,

but they specifically list auto parts, citrus and beef over a period

of 3 to 7 years as being areas where we could expect substantial

export increase.

Would you care to react in any kind of degree of specificity to

those questions and subquestions?

Mr. HAUSER. Yes, thank you, Mr. Chairman.

26

As I say, I had gone through where we saw opportunities largely

arising from the tariff cuts on the agricultural spectrum.

On the industrial side of the ledger, I think the best prospects

we have identified in Vietnam would be, one, aircraft and aircraft

parts; two, oil and gas exploration and production services; three,

power generation and transmission; four, food processing and packaging. Let me do two more, computer hardware software and services and telecom.

I think in most of these sectors there is the opportunity for export sales. We have been talking to the Vietnamese about an aviation agreement. They want to develop a world-class airline. We

know the American producers are in discussions with them. I think

there is a good opportunity there. Vietnam is a resource-rich country. American technology in the areas of oil and gas exploration are

world class. I think there is good opportunity for sales there.

Similarly, as the country industrializes, moves down the development path, power generation, power project will be very important.

Again, I think these all create very real sales opportunities for

American business over the near to medium term once the agreement takes place.

Mr. BEREUTER. Thank you.

We are having a vote a little earlier than I anticipated. I was

going to ask your opinions about what Deputy Under Secretary of

Labor for International Labor Affairs Andrew Samet is likely to

achieve, but I will ask him directly by letter and will move to my

colleagues so we can complete this round and complete the hearing

before we go vote.

The gentleman from Florida, Mr. Davis, is recognized.

Mr. DAVIS. Mr. Chairman, I have no more questions.

Mr. BEREUTER. The gentleman has no questions. Perhaps I will

sneak in one then, if I may; and that is related to the Generalized

System of Preferences [GSP]. Secretary Hauser, the signing of the

BTA could bring Vietnam closer to receiving United States trade

benefits under the GSP. What are the conditions we would think

under which the United States would proceed with granting Vietnam GSP?

Mr. HAUSER. Well, I think as a threshold question—and I am not

a trade lawyer, Mr. Chairman, but I believe Vietnam first needs to

become a WTO member before it passes eligibility for GSP. We

then do have a set of criteria, including issues like intellectual

property protection, worker rights, etc., that we would look at very

carefully in making a decision on GSP.

Again, WTO accession, while we think our agreement tees up a

number of issues at a WTO world-class standard, is still an issue

that is some years down the road.

Mr. BEREUTER. And obviously they will be expected still to be

meeting the economic criteria?

Mr. HAUSER. Yes.

Mr. BEREUTER. The gentleman from California, Mr. Rohrabacher,

is recognized for 5 minutes.

Mr. ROHRABACHER. I will be submitting for the record an article

that came out in the last 2 days describing the end of the ASEAN

negotiations with the Chinese and describing them as being total

27

failures in negotiation, Mr. Chairman. I am surprised that Mr.

Roth characterized it as something else, but we will find out.

Mr. ROTH. I just met with the Philippine foreign minister yesterday who has been intimately involved in the negotiations, and they

are ongoing. They are not over.

Mr. ROHRABACHER. Well, we will take a look and see whether we

are just talking about round one being a failure or whether the negotiations themselves are being labeled as failure.

Also, Mr. Roth, you mentioned that for the first time we have

seen strikes in Vietnam. Do you know, were any of those strikes

at other than foreign-owned companies?

Mr. ROTH. I don’t know the details of them.

Mr. ROHRABACHER. So you are hailing strikes here, but you do

not really know whether or not they are permitted to have strikes

at companies that are owned by anybody else except foreigners?

Mr. ROTH. I was simply making the point that, despite the fact

that these are technically illegal acts, that they did not arrest the

people. They permitted them to go forward. It was part of my point

about the generality trend.

Mr. ROHRABACHER. Well, at a hearing when we were trying to

determine the economic viability of people doing business there, it

would seem to me it would be very important for us to know

whether or not the Vietnamese Government was permitting strikes

at foreign-owned companies but the rest of the country they were

holding labor with an iron fist.

Mr. ROTH. I will try to answer for the record then.

Mr. ROHRABACHER. All right.

Answer: According to our Embassy, 17 legal strikes occurred during the first half

of 2000. Of these, 11 were at foreign-owned enterprises, and 3 at state-owned enterprises. As noted in the 1999 Human Rights Report, an estimated 252 strikes were

reported from January 1995 through September 1999. Of these, some 132 strikes

were in enterprises with foreign investment, about 40 in state-owned enterprises,

and 80 in private enterprises. Most of the strikes did not follow an authorized conciliation an arbitration process, and thus were illegal; however, the Government tolerated the strikes and did not take action against the strikers. Neither the Vietnam

General Confederation of Labor (VGCL) not its affiliate unions officially sanctioned

these strikes, but they were supported unofficially at the local and provincial levels

of the VGCL on an informal basis.

Mr. ROHRABACHER. Let me say I disagree, obviously, with your

assessment about whether or not there has been cooperation about

POWs. I think—and I am very sorry to hear that it now seems to

be want official position of this Administration that the Vietnamese

should not be expected to have the records from the prisons in

which American POWs were held during the war.

Let me note that Communist regimes are infamous for their recordkeeping. They are—this is something that they have excelled in.

They do not excel in economic growth in Communist countries, but

they excel in bureaucratic recordkeeping. And I am just sorry to

hear that we are willing to just give them the benefit of the doubt

that those records no longer exist, because those are some records

that could indicate how many American POWs that they actually

held.

Mr. Roth, are you aware that Pete Peterson was kept not as a

prisoner of war but as a ‘‘missing in action’’ during the first 3 years

of his captivity?

28

Mr. ROTH. No, I wasn’t.

Mr. ROHRABACHER. Do you know what he was not in the ordinary—in with the other prisoners during that time period?

Mr. ROTH. He has told me some of his experiences.

Mr. ROHRABACHER. That would indicate that perhaps there was

a—certain people that were being kept that no one knew were

being kept. These records would indicate that.

I don’t believe that the Vietnamese are being honest with us. I

believe that they kept hundreds of Americans after the war and

perhaps murdered them since. But we need to know that before we

should be entering into an agreement that provides U.S. taxpayer

subsidies to businessmen who build factories there, or permit that

country to have a high level of tariffs against American products

while they can flood their products that are being built with slave

labor into our markets. It is not good for America, and it is not

being loyal to our own people.

Thank you very much, Mr. Chairman.

Mr. BEREUTER. Thank you very much, Mr. Rohrabacher.

Gentlemen, I want to thank you for your testimony today. Obviously, we expect to come back to this subject in the next Congress.

As I mentioned, this was a way of us starting for consideration of

the BTA when it is officially brought before us.

I was going to ask Ms. Barshefsky when we could expect a letter

of transmittal, but perhaps we will do that by letter. And I would

make an announcement that while I am never convinced that anything is final in the Senate, I am told that the vote on H.R. 4444

was 85 to 15. The Subcommittees are adjourned.

[Whereupon, at 3:04 p.m., the Subcommittees were adjourned.]

(29)

A P P E N D I X

SEPTEMBER 19, 2000

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