VIETNAM-NORTH KOREA: RELATIONS CONTINUE TO THAW

UNCLAS SECTION 01 OF 02 HANOI 002967

SIPDIS

SENSITIVE

STATE FOR EAP/BCLTV; EAP/K; EAP/RSP; INR/EAP

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E.O. 12958: N/A
TAGS: PREL ETRD VM KN KS DPRK
SUBJECT: VIETNAM-NORTH KOREA: RELATIONS CONTINUE TO THAW



1. (SBU) SUMMARY. THE SRV/DPRK JOINT ECONOMIC,
SCIENTIFIC, AND TECHNOLOGY COMMITTEE MET IN PYONGYANG FROM
OCTOBER 15-19 FOR THE FIRST TIME SINCE VIETNAM OPENED
BILATERAL RELATIONS WITH SOUTH KOREA IN 1992. WHILE PRESS
REPORTS TOUTED THE MEETING AS "HERALDING A COMPLETE REVIVAL
OF BILATERAL TRADE," THE RESULTS OF THE MEETING APPEAR VERY
MODEST. THIS MEETING FOLLOWED A SERIES OF HIGH LEVEL VISITS
OVER THE PAST YEAR. THE RECENT THAW IS IN LINE WITH
VIETNAM'S GENERAL POLICY TO "BE FRIENDS WITH EVERYONE" AND
HAS NOT IMPACTED ITS THRIVING RELATIONSHIP WITH SOUTH KOREA.
END SUMMARY.

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JOINT COMMITTEE MEETING REFLECTS "TRADITIONAL RELATIONS"
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2. (SBU) IN AN OCTOBER 29 MEETING, NGUYEN THAC DU, KOREA
DESK DIRECTOR FOR THE MINISTRY OF FOREIGN AFFAIRS (MFA) ASIA
I SECTION, TOLD POLOFF THAT THE VIETNAM-DPRK RELATIONSHIP IS
"REALLY VERY GOOD." HOWEVER, HE ADMITTED THAT WHEN VIETNAM
ESTABLISHED RELATIONS WITH SOUTH KOREA IN 1992, THE
"TRADITIONAL RELATIONSHIP WAS STRAINED" WITH PYONGYANG. DU
ACKNOWLEDGED THAT SINCE 1992 THERE HAD BEEN ALMOST NO
BILATERAL TRADE, BUT ASSERTED THAT THIS WAS NOT DUE TO THE
POLITICAL COOLING BETWEEN THE TWO COUNTRIES. RATHER, IT WAS
DUE TO THERE BEING "VERY LITTLE TO EXCHANGE." ACCORDING TO
DU, A SERIES OF OFFICIAL VISITS THAT BEGAN IN 2000 SIGNALED
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A RETURN TO THE TRADITIONAL FRIENDSHIP AND INDICATED THAT
THE RELATIONSHIP IS NOW "RECOVERING STEP BY STEP." THESE
VISITS INCLUDED: (1) THE SRV FOREIGN MINISTER'S VISIT TO THE
DPRK IN APRIL 2000; (2) THE DPRK FOREIGN MINISTER'S VISIT TO
VIETNAM IN AUGUST 2000; (3) THE DPRK SUPREME ASSEMBLY
PRESIDENT'S VISIT TO VIETNAM IN JULY 2001; AND, (4) THE
OCTOBER 2001 JOINT ECONOMIC COMMITTEE MEETING. DU NOTED
THAT SRV PRESIDENT TRAN DUC LUONG IS EXPECTED TO VISIT
PYONGYANG IN 2002, BUT HE COULD NOT PROVIDE A SPECIFIC DATE.

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MODEST RESULTS FROM JOINT ECONOMIC COMMITTEE MEETING
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3. (SBU) DU DESCRIBED THE MEETINGS AS "VERY SUCCESSFUL,"
BUT HE ADMITTED THE RESULTS WERE "MODEST" AND SAID THERE
WERE NO SIGNIFICANT OR VERY SPECIFIC AGREEMENTS SIGNED.
ACCORDING TO DU, THE TWO COUNTRIES DID SIGN A "COOPERATION
AGREEMENT" COVERING THREE GENERAL AREAS:

--THE TWO COUNTRIES WILL "CONTINUE TO WORK" TO CONCLUDE AND
SIGN FIVE AGREEMENTS ON ECONOMIC COOPERATION, INCLUDING
INVESTMENT, SEA TRANSPORTATION, AVOIDANCE OF DOUBLE
TAXATION, TRADE, AND BANKING;

--THEY WILL SEEK TO COOPERATE IN OTHER FIELDS, SUCH AS
CONSTRUCTION, AGRICULTURE, TRANSPORTATION, FISHERIES,
HEALTH, SCIENCE, TECHNOLOGY, CULTURE, SPORTS, AND TOURISM;

--THEY WILL HOLD THE NEXT JOINT COMMITTEE MEETING IN HANOI
IN 2003.
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4. (SBU) DU STATED THAT A MAJOR FOCUS OF THE MEETING WAS
BILATERAL TRADE, CURRENTLY RUNNING ONLY AT ABOUT USD 4
MILLION ANNUALLY. DU TOLD POLOFF THAT BOTH SIDES AGREED TO
"WORK SUBSTANTIALLY TO INCREASE" TRADE, BUT HE COULD NOT
PROVIDE ANY SPECIFIC FIGURES OR DEADLINES. WHEN ASKED WHAT
PRODUCTS VIETNAM COULD POTENTIALLY IMPORT FROM THE DPRK, DU
CITED A CHEMICAL USED FOR CEMENT PROCESSING, AND CERAMIC
PIECES THAT SEPARATE POWER LINES. DU INDICATED THAT MAJOR
ADDITIONAL RICE SALES WERE NOT LIKELY, NOTING THAT THE ISSUE
OF THE DPRK'S USD 10 MILLION DEBT TO VIETNAM FOR A 1996 RICE
"SALE" HAD NOT EVEN BEEN RAISED BECAUSE VIETNAM UNDERSTOOD
THAT THE "ECONOMIC SITUATION THERE IS STILL VERY HARD."


5. (SBU) NGO XUAN BINH, DIRECTOR FOR THE CENTER FOR KOREAN
STUDIES, OPINED THAT PERHAPS PART OF THE RECENT INCREASE IN
BILATERAL ACTIVITY IS THAT THE DPRK HAD SEEN THE SUCCESS
VIETNAM HAD ACHIEVED WITH ITS MARKET REFORMS AND WAS HOPING
TO LEARN FROM VIETNAM'S EXPERIENCE. HOWEVER, DUE TO THE
LACK OF ACCESS TO THE DPRK, BINH ADMITTED THAT "IT IS VERY
HARD TO KNOW WHAT THEY THINK."

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SOUTH KOREAN VIEW-LITTLE FOR VIETNMAM TO GAIN ECONOMICALLY.
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6. (SBU) A SOUTH KOREAN EMBOFF TOLD POLOFF ON OCTOBER 26

THAT THE GLOWING IMPRESSION GIVEN BY VIETNAMESE PRESS
ACCOUNTS OF THE MEETING WAS "OUT OF PROPORTION" WITH WHAT
HAD ACTUALLY OCCURRED. THE MOST SENIOR OFFICIALS PRESENT
WERE THE VICE MINISTERS OF TRADE, AND THERE WERE NO
SUBSTANTIVE POLITICAL DISCUSSIONS, HE CLAIMED. THE EMBOFF
NOTED THAT "IN REALITY, THERE IS NO COMMON AREA FOR THE TWO
SIDES SUBSTANTIALLY TO INCREASE THEIR RELATIONSHIP" AND THAT
A SIGNIFICANT INCREASE IN TRADE IS UNLIKELY BECAUSE
ESSENTIALLY THE DPRK HAS NO MONEY AND VERY LITTLE TO OFFER
THAT VIETNAM DOES NOT ALREADY HAVE. DUE TO THE DPRK'S
EXTREME POVERTY, HE ASSERTED, THE ONLY POSSIBLE TRADE IS
"BARTER TRADE." SUCH TRADE COULD POSSIBLY INCLUDE "RICE FOR
RUBBER OR POSSIBLY SOME MINERALS," ACCORDING TO THE EMBOFF.
CONTRASTING VIETNAM'S RELATIONS WITH SOUTH KOREA, HE
CONCLUDED THAT, "VIETNAM CANNOT GAIN ANYTHING ECONOMICALLY
FROM THE DPRK."

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.BUT BETTER RELATIONS ARE GOOD
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7. (SBU) THE SOUTH KOREAN EMBOFF NOTED THAT SEOUL
NONETHELESS VIEWS THE RECENT THAW BETWEEN VIETNAM AND THE
DPRK POSITIVELY. HE OPINED IT MIGHT BE CONSIDERED AN
OUTGROWTH OF VIETNAM'S "DOI MOI" (RENOVATION) POLICY AND THE
DPRK'S "DESPERATE" ECONOMIC SITUATION. ACCORDING TO THE
EMBOFF, VIETNAM -- HAVING ACHIEVED SOME ECONOMIC SUCCESS
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SINCE "DOI MOI" IMPLEMENTATION IN 1986 -- IS PAYING MORE
ATTENTION NOW TO ITS POLITICAL RELATIONSHIPS. SOUTH KOREAN
POLICY HAS ALSO PLAYED A ROLE, ACCORDING TO THE EMBOFF. THE
"US OR THEM" POLICY OF THE EARLY 1990S HAS BEEN REPLACED BY
AN ROK POLICY THAT WELCOMES NORMALIZATION AND ENGAGEMENT
WITH THE NORTH, HE NOTED. SIMILARLY, THE DPRK POLICY OF
CUTTING OFF EVERY COUNTRY THAT OPENED RELATIONS WITH SOUTH
KOREA HAS ALSO CHANGED. THESE POLITICAL FORCES, PLUS THE
DPRK'S DIRE ECONOMIC SITUATION, HAVE "COME TOGETHER" TO
INFLUENCE THE ONGOING PROCESS, HE DESCRIBED. BINH, FROM THE
KOREA STUDIES CENTER, SEPARATELY NOTED THAT THE DPRK HAS
ALSO BEEN MAKING "SOME OVERTURES" TO SOME WESTERN EUROPEAN
COUNTRIES AND COMMENTED THAT "SLOWLY, THE DPRK IS TRYING TO
BECOME LESS ISOLATED."

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NO IMPACT ON VIETNAM-SOUTH KOREA RELATIONS
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8. (SBU) DU AND THE SOUTH KOREAN EMBOFF SEPARATELY STATED
THAT THE RELATIONSHIP BETWEEN SOUTH KOREA AND VIETNAM IS
VERY GOOD AND THAT THE RECENT WARMING OF TIES WITH THE DPRK
HAD DONE NOTHING TO CHANGE THIS. THE KOREAN STUDIES
CENTER'S BINH ALSO DESCRIBED THE SRV/ROK RELATIONSHIP AS
"VERY SOLID." MOST RECENTLY, VIETNAM'S PRESIDENT VISITED
SOUTH KOREA IN AUGUST AND SOUTH KOREA'S INFORMATION AND
COMMUNICATIONS MINISTER VISITED VIETNAM IN LATE OCTOBER.
SOUTH KOREA ALSO HAS AN ONGOING ASSISTANCE PROJECT TO BUILD
40 NEW SCHOOLS IN CENTRAL VIETNAM, RECEIVING FAVORABLE MEDIA
COVERAGE.

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9. (SBU) COMMENT: THE FORCES THAT RESULTED IN THE COOLNESS
BETWEEN THE DPRK AND VIETNAM FROM 1992-2000 HAVE LARGELY
DISSIPATED, LEAVING THE DOOR OPEN FOR REVITALIZATION OF TIES
BETWEEN THESE "TRADITIONAL FRIENDS." THIS PROCESS IS APT TO
CONTINUE ALONG ITS PRESENT MODEST BUT POSITIVE PATH, BUT IT
APPEARS HIGHLY UNLIKELY THAT BILATERAL ACTIVITY WILL
INCREASE SIGNIFICANTLY IN THE SHORT TO MEDIUM TERM.
PORTER

UNCLASSIFIED