DEVELOPMENT AND BORDER ISSUES IN THE NORTHERN MEKONG

UNCLAS SECTION 01 OF 02 HO CHI MINH CITY 000162

SIPDIS

SENSITIVE

DEPARTMENT PLEASE PASS USTR, ELENA BRYAN
USDOC FOR 6500 AND 4431/MAC/AP/OPB/VLC/HPPHO

E.O. 12958: N/A
TAGS: ECON PGOV EINV PREL SOCI ETRD PHUM EAGR SNAR VM
SUBJECT: DEVELOPMENT AND BORDER ISSUES IN THE NORTHERN MEKONG
DELTA


1. (SBU) Summary: A recent visit by the Deputy Chief of Mission
(DCM) to the Mekong Delta provinces of Dong Thap and Vinh Long
revealed that, like much of the rest of the Mekong Delta, these
provinces rely heavily on agri- and aquaculture to fuel their
economic growth. Plentiful harvests of rice, fruit and seafood
have not been matched with development of the industrial sector.
Senior officials in both provinces requested help to increase U.S.
direct foreign investment (FDI) and humanitarian aid. End
Summary.


DEVELOPMENT AND BORDER ISSUES IN DONG THAP
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2. (U) The DCM traveled to the Mekong Delta January 20-22. He
called on provincial officials in Dong Thap and Vinh Long and
visited various American non-governmental organization (NGO)
projects in the region. In Dong Thap, the DCM met with Mr. Truong
Ngoc Han, Chairman of the Dong Thap People's Committee, and twelve
other department directors and representatives of industry and
agriculture within the province. Chairman Han stressed Dong
Thap's success in agriculture and aquaculture (catfish, shrimp,
and other aqua products). Currently, Dong Thap produces 2.4
million tons of rice per year and has 25,000 hectares of fruit
gardens. The province is famous for its mangos, longans, mandarin
oranges, carnations and orchids. Most fruit exports go to China
and Japan, rice is exported to Europe, and aqua-products are
shipped to the U.S. Dong Thap is the third largest producer of
foodstuffs in Vietnam. The province's greatest challenge is
developing a food processing industry. There are plans for
developing three industrial parks and 11 small-scale industry
zones. Dong Thap's GDP grew by 10.16 percent in 2004, driven
mainly by the largest sector of agri- and aquaculture, which makes
up 56.9 percent of the province's GDP.


3. (SBU) Provincial leaders in Dong Thap are proud of their
success in reducing poverty from 14 percent in 2000 to 4.8 percent
in 2004. Chairman Han visited the U.S. with Deputy Prime Minister
Vu Khoan in 2004 and was favorably impressed with the
infrastructure and governance in the U.S. He made a point of
mentioning the importance of human rights and democracy, and
expressed his desire to help Dong Thap in these areas. Dong Thap
leaders requested USG assistance in improving the environment,
preventing the spread of HIV/AIDS, creating infrastructure and
educational facilities, and increasing foreign direct investment
(FDI). The Chairman noted that Dong Thap has the fifth highest
HIV/AIDS infection rate in the Mekong Delta.


4. (SBU) Dong Thap leaders are also concerned about their 48-km
border with Cambodia. Currently the province is working with the
Cambodian Government and the Vietnamese Ministry of Public
Security (MPS) to prevent border crimes such as drug smuggling,
human trafficking, and contraband. In the past five years, these
joint efforts have intercepted 17 cases of child trafficking.


5. (U) The DCM visited two American NGO projects in the province.
USDA and Land O'Lakes sell or trade surplus American commodities
to fund a nutrition and health program in two local schools.
Studies have shown that the program has increased student
performance and attendance. As the U.S. funding for the project
ends this summer, the DCM encouraged the local Department of
Health and Department of Agriculture to pick up the program in the
future. The NGO Heifer International provides small loans
(usually of one or two animals such as cows or pigs) to local
farmers to start an animal breeding program. Each farm passes the
first healthy offspring to another member in the community and
then keeps the rest. The program is looking for $40,000 to set up
similar projects helping the Khmer people.

DEVELOPMENT AND EDUCATION ISSUES IN VINH LONG
--------------


6. (SBU) In Vinh Long, the DCM called upon Mr. Truong Van Sau,
Chairman of the provincial People's Committee. According to
Chairman Sau, Vinh Long leaders hope to move the province from
agriculture (currently 54.76 percent of the province's GDP) to
services and industry (currently 30.62 percent of GDP). While 75
percent of the population is involved in agriculture, the local
government is keen to attract more investment and is developing
its first industrial park to facilitate investment. Vinh Long's
GDP grew by 9.63 percent in 2004.


7. (U) Vinh Long leaders are actively developing the province's
educational facilities, particularly its Mekong University.
Established in 2000, Mekong University focuses on training in agri-
and aquaculture and is the first self-funded university in the
Mekong Delta. In a meeting with the DCM, University directors
expressed their desire to receive USG funding for facilities,
equipment, and books. They also hope to establish links to other
U.S. universities for professor and student exchanges. The
school, which has a student body of 5,500, moved to its new campus
in 2002 and hopes to take advantage of the new industrial park
across the street to provide job opportunities for its graduates.


8. (U) There are a variety of American NGOs involved in the
province, with programs running from literacy to caring for
orphans to housing assistance. The DCM visited two housing
projects sponsored by Catholic Relief Services (CRS),which
receives USG assistance. Many homes in Vinh Long were destroyed
in 2000 by flooding. The provincial government has assisted with
the construction of approximately 7,000 houses, but further
assistance is needed for about 5000 homes. CRS has chosen to help
some of the poorest families by placing their homes on raised
cement platforms, building better roofs, and providing loans to
help the families get back on their feet. The families are then
responsible for the walls and any other improvements to the house.

COMMENT
--------------


9. (SBU) Leaders in both provinces are looking forward
economically and developmentally. Dong Thap appears to have a
more serious crime problem because of the border it shares with
Cambodia, but is taking action to solve it. Leadership in Dong
Thap also seems to have a better grasp of the legal, social, and
economic changes that will have to happen to encourage more FDI
from the U.S. The next logical step for industry in these
provinces is to develop food processing plants to package and add
value to the multitude of agricultural and aqua-products.

WINNICK