NGUYEN CAO KY VISITS HCMC AGAIN - ADVISING THE GVN?

UNCLAS SECTION 01 OF 02 HO CHI MINH CITY 001404

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SUBJECT: NGUYEN CAO KY VISITS HCMC AGAIN - ADVISING THE GVN?


1. (SBU) Summary: We met November 9 in HCMC with former Vice
President of the Republic of South Vietnam Nguyen Cao Ky, who made
headlines with a well-publicized reconciliation visit to Vietnam
in January 2004. Ky told us he was back on a "quiet working
visit" to engage the GVN on Viet Kieu reconciliation as well as
domestic socio-economic issues, including the Central Highlands
and corruption. Ky told us that GVN officials informed him that
they had approved an initiative to rehabilitate a large ARVN
cemetery near HCMC -- a gesture that the Mission had separately
urged the GVN undertake in its efforts to build bridges with the
Vietnamese community overseas. Ky says that almost all GVN
officials that he has met -- even many in the North -- are keen to
improve ties with the United States, in part to act as a
counterbalance to Chinese influence in the region. End Summary.


2. (SBU) At the implicit suggestion of Special Envoy of the PM to
the South, Vo Viet Thanh (septel),DPO and PolOff met November 9
at the ConGen with Nguyen Cao Ky, former General and Vice
President of the Republic of Vietnam. Ky, who had been in country
for two days, told us that he was in Vietnam as an unofficial
advisor to the GVN on a range of issues, from the GVN's policy in
the Central Highlands to its outreach efforts with the Vietnamese
Diaspora in the United States. Unlike his previous visit during
the "Tet" holidays in January 2004, this visit was very low key.
Ky expressed surprise to have received VIP treatment upon his
arrival, having been whisked through customs by the External
Relations Office, Police and other GVN officials. Since his
arrival two days ago, Ky said that he had met with Director of the
HCMC Office of External Relations Hung, twice with special advisor
to the Prime Minister Vo Viet Thanh and with Deputy Chairman of
the HCMC People's Committee, Dr. Nhan. Other meetings with GVN
officials are planned in Hanoi, Danang, Nha Trang and Dalat over
the course of the next month.

Ties to the Viet Kieu and the United States
--------------


3. (SBU) Ky said that he is a core member of a quiet process of
reconciliation between the GVN and the Viet Kieu community in the
United States. Despite the negative press that his initial visit
to Vietnam created in the Viet Kieu community in the United
States, the long-term fallout to him and his family has been
minimal. He maintained that both in Vietnam and in the United
States, hardliners were a dying breed. This process of
reconciliation has happened to him on a personal level as well.
He said he and Vo Viet Thanh (who, inter alia, was a Viet Cong
leader) now are "brothers," a sentiment echoing Thanh's comments
in our meeting with him November 8.


4. (SBU) Ky said that he was particularly encouraged by a recent
GVN decision to rehabilitate a major ARVN cemetery near HCMC. He
told us that in his February 2004 meetings with GVN officials,
they had expressed real reticence to move forward, largely because
the issue still was "too sensitive" for conservatives and military
officials. Ky advised them, however, that, "if you want to
reconcile with the Viet Kieu, you have to reconcile with their
dead first."


5. (SBU) Ky told us that three weeks ago he hosted a reception for
visiting Deputy Minister of Foreign Affairs Nguyen Phu Binhin
Orange County and Binh said that the GVN had agreed to move ahead
quietly with the cemetery's rehabilitation. Ky said the GVN has
assigned Deputy PM Pham Gia Khiem and the MoD to oversee the
rehabilitation. After the work is completed, Ky will lead a
delegation of Viet Kieu to reopen the cemetery.


6. (SBU) Ky added that officials in southern Vietnam had expressed
a clear desire to forge close ties with the United States.
Vietnamese officials were driven both by a fear of China by and a
desire to expand business ties. While he had not yet visited
Hanoi on his current visit, during his January visit he had sensed
more suspicion of the United States. But even in Hanoi, Ky said
that GVN officials had told him Vietnam needs to "counterbalance"
China, a role that only the United States could play.

Corruption
--------------


7. (SBU) Ky said GVN leaders clearly understand that corruption is
the biggest threat to economic growth and, ultimately, the
legitimacy of the one-party state. In Ky's view, the fundamental
problem is that almost all GVN and Party leaders are buried deep
in corruption, making it hard for them to argue that the next
generation of leaders should behave any differently. This
corruption, he said, goes all the way to the top of the Party and
to the highest levels of the government. What he saw in South
Vietnam when he was Vice President pales in comparison with
corruption in Vietnam today, Ky asserted.


8. (SBU) While part of the problem is structural -- Vietnam does
not have the institutions to combat corruption -- Ky also
indicated that the other part of the problem is ideological.
Other than for old-timers in the party, Communism is dead.
Vietnam, he argued, is left with a one-party state with no
ideological moorings.

Deja Vu in the Central Highlands
--------------


9. (SBU) Ky said that GVN officials also have asked him during
this visit to take a look at the problems they face in the Central
Highlands. Ky recounted the development, social
disenfranchisement and minority/majority tensions over land that
he had encountered as Vice President. (Note: With the exception
of the new dimension of religious freedom, eerily similar
conditions exist today. End note.) Ky said the key to easing
problems in the region was to ensure that local officials are
pressed from the center to implement the government's policies.
Official development support from the international community also
was important to help the process of reform in the Highlands. In
his opinion, GVN officials -- at least at the central level --
would welcome U.S. development assistance.


10. (SBU) Comment: The extent of Ky's influence within the Party
and GVN in the south is difficult to gauge. However, meetings
with local heavyweights such as the Director of the HCMC External
Relations Office and the HCMC People's Committee do not come easy
to private individuals, especially Viet Kieu with only advice to
give. It is also interesting the Ky is making his second visit in
less than a year, and this time with neither publicity nor
propaganda aspects. Ky's comments on a GVN decision to
rehabilitate the ARVN cemetery near HCMC bear close watching, as
we have been pressing the GVN to take such a dramatic step to
break the ice with the Viet Kieu community. So do Ky's comments
that the GVN may be ready to accept U.S. development assistance in
the Central Highlands.

WINNICK