VIETNAM "CONCERNED" ABOUT DUMPING INVESTIGATION, READY FOR

UNCLAS HANOI 000439 SENSITIVE SIPDIS STATE FOR EAP/MLS MBROWN COMMERCE FOR TREASURY FOR SCHUN USTR FOR DBISBEE, RMALMROSE AND ESHEA E.O. 12958: N/A TAGS: EIND ECON ETRD VM SUBJECT: VIETNAM "CONCERNED" ABOUT DUMPING INVESTIGATION, READY FOR BIT, TPP AND MES TALKS REF: A) DOC Fact Sheets Plastic Bags Investigation; B) "Working Group Discusses Market Economy Status" (Hanoi 1403); C) Plan to Deregulate Power Sector (Hanoi 211); D) U.S. Visit of Vietnam's Economic Czar (08 Hanoi 1251) ¶1. (U) This cable is Sensitive but Unclassified. For official use only, not for dissemination outside USG channels or posting on the internet. ¶2. (SBU) Summary: Vietnam's Trade and Investment Minister said Vietnam is "very concerned" that the ongoing countervailing and anti-dumping investigations (AD/CVD) of Vietnamese plastic bags will set a "dangerous precedent" that could affect the development of our bilateral relations. He expressed his hopes that Vietnam and the United States could continue expanding economic relations with initiatives like the Transpacific Partnership (TPP) and the Bilateral Investment Treaty (BIT),and again reiterated his hopes that USTR Kirk can visit Vietnam in July after the APEC Summit in Singapore. End Summary. DUMPING INVESTIGATIONS SET A "DANGEROUS PRECEDENT" -------------- -------------- ¶3. (SBU) In a May 8 meeting with the Ambassador, Minister Vu Huy Hoang expressed "urgent" concerns about the ongoing investigation on polyethyline retail carrier bags, announced by the Department of Commerce on April 21, 2009 (REF A). Minister Hoang said that he was less concerned about the impact on the $79.4 million-worth of plastic bag exports to the United States, than he was about the "dangerous precedent" that this investigation could set. The Minister said that it could open the door to other export goods coming under investigation in the United States, or to other countries following suit. ¶4. (SBU) Moreover, Vietnam's top trade official added that he was preoccupied about the potential impact that the ongoing investigations could have on bilateral relations. Hoang addressed these concerns in May 8 letters to Commerce Secretary Locke and USTR Kirk (Septel). A decision on whether the investigation will continue is expected on May 15. ¶5. (SBU) The Ambassador asked Hoang to trust the fairness, transparency, objectivity and WTO-consistency of the process, but stated that other agencies could not interfere with the investigation. The Ambassador reassured Hoang that the United States continued to value the bilateral relationship and support growing economic ties. He also urged the GVN to continue working on the Market Economy Status Working Group (REF B) and the Bilateral Investment Treaty, both of which are set to hold second rounds this summer. WAITING FOR WORD ON TPP, READY FOR BIT -------------- ¶6. (SBU) Somewhat in contrast to Hoang's "urgent concerns" over the AD/CVD case, Hoang said that Vietnam was "looking forward for words on the first TPP meeting," while preparing for the second round of BIT talks in June 1 and 2 in Hanoi. He again reiterated his desire to host USTR Kirk after the July APEC Summit in Singapore, and other Cabinet level officials at later dates. He also said that he was looking forward to receiving a delegation of U.S. businesspeople from the US-ASEAN Business Council in the second week of May 2009. "PROGRESS" ON INVESTMENT CONTRACT NEGOTIATIONS -------------- - ¶7. (SBU) The Ambassador also asked the Minister about the status of contract negotiations with AES and Chevron. Hoang said that the Government of Vietnam would soon submit a counteroffer to AES April 6, 2009 proposal to build a power station, and that he understood that "good progress" had been made in the separate Chevron negotiations on a gas-to-power project in the Gulf of Thailand (REF C). MICHALAK