GVN PONDERS DELIVERABLES FOR A PM VISIT

UNCLAS SECTION 01 OF 02 HANOI 001414 SIPDIS STATE FOR EAP/MLS, INR/B AND EB/TPP/BTA/ANA STATE PASS USTR FOR DBISBEE USDOC FOR 4430/MAC/ASIA/OPB/VLC/HPPHO SENSITIVE SIPDIS E.O. 12958: N/A TAGS: ECON EFIN EAID ETRD PREL VM SUBJECT: GVN PONDERS DELIVERABLES FOR A PM VISIT Ref: Hanoi 1060 ¶1. (SBU) Summary. In his farewell meeting with the Ambassador, the Chairman of the Office of the Government (OOG) said that the GVN is mulling a number of "deliverables" for Prime Minister Zung's September visit to the United States. Among them, he cited long-pending deals on the purchase of Boeing aircraft, power generation, ports and mining, and even resolution to the protracted negotiations over a Peace Corps program and the new embassy compound. Progress on the commercial deals, according to the Ambassador, would help address concerns about Vietnam's growing trade imbalance. At the meeting, Ambassador Marine also urged Vietnam to tackle political reforms without delay, warning that the country's development would be truncated without greater freedoms. End Summary. DELIVERABLES UNDER CONSIDERATION -------------- ¶2. (SBU) OOG Chairman Doan Manh Giao told Ambassador Marine during their July 30 meeting that his office had been tasked with putting together a package of deliverables for the visit of Prime Minister Nguyen Tan Zung to the United States in late September for the opening of the United Nations General Assembly. Giao told Ambassador Marine that the deliverables under consideration included a deal on Vietnam Airlines' negotiations with Boeing aircraft for the purchase of ten 787s, and giving final green light to Gannon Power Vietnam's power generation project for the industrial zones of Dong Nai Province in the south and SSA Marine's Cai Lan port project in northernmost Quang Ninh Province, both of which are pending investment licenses. The Chairman also mentioned supporting Alcoa and state-owned Vinacomin's joint venture to develop a bauxite mine and alumina refinery in the southern province of Dak Nong. ¶3. (SBU) Giao said that he would consider also recommending as deliverables the establishment of Peace Corps project in Vietnam and the go-ahead for the construction of a new embassy compound -- both of which the Ambassador raised as part of his agenda for the meeting (see paragraphs 9 and 10). The OOG oversees day-to-day running of the Cabinet and advises the Prime Minister, in a manner akin to our Chief of Staff. AMBASSADOR URGES VIETNAM TO TACKLE POLITICAL REFORM... -------------- -------------- ¶4. (SBU) The Ambassador said that all of the ingredients of a successful bilateral relationship were in place, save one: political reform. "A successful and developed society cannot thrive without genuine and open plurality," he said. The Ambassador noted that, despite progress in some fronts, "there are areas that are worse than they were three years ago," when he began his term. ¶5. (SBU) Ambassador Marine called on the GVN to allow people to speak out freely and the media to grow into its natural role as a watchdog against excesses. He praised Prime Minister for pledging to reform governance and the rule of law, and Deputy Prime Minister/Foreign Minister Pham Gia Khiem for embracing cooperation with the United States in this area in his recent response to Senator Patrick Leahy (D-VT) (reftel),but said that it was high time for concrete action. ¶6. (SBU) The Ambassador mentioned anti-corruption efforts as one governance challenge that the two countries could tackle immediately. He said that the U.S. stood ready "right now" to assist Vietnam in this regard, but that we need to develop a concrete plan for implementing new cooperative programs. Ultimately, he said, "the government has to allow people and the media to hold" office-holders accountable. ¶7. (SBU) Chairman Giao acknowledged that Vietnam needed to "do more on democracy, including rule of law, freedom of speech, religious freedom and freedom to express political views." He urged the United States to continue pressing these issues through dialogue, not confrontation, and added that the Vietnamese leadership understood that "the bilateral relation is not just about the economy and trade." ... AND WARNS ABOUT TRADE IMBALANCE -------------- ¶8. (SBU) The Ambassador raised the possibility that Vietnam's significant trade surplus with the United States, which grows larger every year, could start drawing flak. Although confident that as Vietnam opens its markets to U.S. products the pressure would subside, the Ambassador urged Chairman Giao to look into short-term ways to reduce the imbalance. The Chairman said that he agreed that HANOI 00001414 002 OF 002 the commercial deliverables were the short-term solution. (RE)MAKING THE CASE FOR NEW EMBASSY COMPOUND -------------- ¶9. (SBU) The Ambassador drew smiles from his host when he quipped that he would be "ashamed to have you visit my office because the embassy building is so ugly and so inappropriate, given the state of our relationship." Giao said that the new embassy compound (NEC) should be a GVN priority, terming the current situation "regrettable." PLEA FOR THE PEACE CORPS -------------- ¶10. (SBU) The Ambassador said that the impasse over the establishment of a Peace Corps program, despite high-level GVN support, was as frustrating as inaction on the NEC. "Every minister I meet tells me that the GVN wants to make it happen, and yet the negotiators can't close the deal," he lamented. Chairman Giao said that he would follow up and mentioned it as a potential PM deliverable. MEETING AND CONTEXT -------------- ¶11. (SBU) The meeting was one of Ambassador Marine's farewell calls on Vietnamese leaders. Chairman Giao, who is also leaving his post at the end of the month, warmly greeted and thanked Ambassador Marine for his contributions to Vietnam's successes, citing in particular the Bilateral Trade Agreement, WTO accession and the visits of President Triet and Deputy Prime Minister Khiem to the United States, and of President Bush to Vietnam. The Ambassador thanked the Chairman and his staff for his valuable assistance during his tenure. MARINE