This record is a partial extract of the original cable. The full text of the original cable is not available.

UNCLAS SECTION 01 OF 05 HANOI 002946 
 
SIPDIS 
 
SENSITIVE 
 
STATE FOR EAP/BCLTV and EB/TPP/BTA/ANA 
PACOM FOR FPA 
STATE PASS USTR ELBRAYN AND GHICKS 
USDOC FOR 4431/MAC/AP/OPB/VLC/HPPHO 
 
E.O. 12958: N/A 
TAGS: PREL PGOV PHUM KIRF ECON ETRD EINV VM HUMANR RELFREE ETMIN HIV AIDS WTO
SUBJECT:  The Ambassador's October 28 Call on Prime Minister 
Phan Van Khai 
 
Reftel: A) Hanoi 2908; B) Hanoi 2863; C) Hanoi 2379; D) 
Hanoi 2398 
 
¶1. (SBU) Summary:  Meeting officially for the first time 
October 28, the Ambassador and Prime Minister Phan Van Khai 
spent over an hour discussing the overall bilateral 
relationship, trade and commercial matters, health 
cooperation, religious freedom and human rights issues, 
Montagnards in the Central Highlands and construction of the 
new Embassy compound.  The Prime Minister expressed 
gratitude for the Ambassador's support for Vietnam's WTO 
accession and urged the USG not to create "strict 
conditions" during bilateral negotiations; called for the 
creation of a "bilateral framework for long-term 
cooperation;" noted that the GVN had selected Boeing to 
supply Vietnam's long-haul aircraft; agreed that Vietnam's 
leadership should speak out on HIV/AIDS and asked the United 
States to send more experts in this field; underlined 
Vietnam's policy to support ethnic minorities and promote 
religious freedom, noting that the prominent prisoners 
raised by the Ambassador had been imprisoned for breaking 
the law; argued that Montagnards crossing into Cambodia did 
so at the encouragement of the Montagnard Foundation in the 
United States; and took note of the Ambassador's request to 
move forward with our plans to purchase land identified as 
the site for the new Embassy.  End Summary. 
 
¶2.  (SBU) The Ambassador, accompanied by Pol/C, acting 
Econ/C and Pol Assistant, met officially for the first time 
October 28 with Prime Minister Phan Van Khai.  Accepting the 
Prime Minister's invitation to begin what turned into 70- 
minute conversation, the Ambassador said that the bilateral 
relationship is in good shape, with both sides' having made 
significant progress in the nine years since normalization. 
Military-to-military ties are growing, the United States has 
its largest Fulbright program in the world in Vietnam and 
bilateral trade is skyrocketing. 
 
¶3. (SBU) Trade is the bedrock of the relationship, the 
Ambassador continued, and both countries have clearly 
benefited from continually expanding trade ties.  The next 
obvious step is Vietnam's accession to the WTO, and we had 
heard good things about the ongoing discussions in 
Washington.  The Prime Minister's own statements on economic 
reform and corruption and his speech at the opening of the 
National Assembly (Ref A) made clear Vietnam's interest in 
going further and faster in its international economic 
integration efforts.  The United States strongly supports 
Vietnam's WTO accession, and, as the bilateral negotiations 
proceed, we hope to focus more on the timetable and approach 
for reaching WTO standards, which will help Vietnam to 
achieve more rapid economic growth. 
 
¶4. (SBU) Vietnam's accession to the WTO is especially 
essential for Vietnam's textile industry.  If Vietnam does 
not succeed in acceding soon to the WTO, it will be 
difficult for foreign buyers to continue to invest time and 
money in Vietnam.  The sooner Vietnam does not have to deal 
with the quota system, the better, the Ambassador noted. 
The United States also hopes to work with the GVN on 
financial sector reform.  Ultimately, domestic savings and 
investment will be a greater source of capital than 
development assistance, remittances or foreign assistance, 
but Vietnam needs a good banking system to make this work, 
the Ambassador stressed. 
 
¶5. (SBU) Health cooperation has expanded considerably and 
will expand much more thanks to the President's Emergency 
Fund for HIV/AIDS, the Ambassador noted.  For the United 
States, the GVN's cooperation and coordination are vital, 
particularly in three areas: 
 
-- 1) A GVN-wide commitment is necessary for our efforts to 
succeed, and the Ambassador expressed his hope to be able to 
brief the GVN's interagency committee on our five-year 
strategy; 
 
-- 2) On drug imports, as part of its HIV/AIDS assistance 
program, the USG hopes to import large amounts of drugs, and 
we need a GVN waiver of the 15 percent import tariff; 
-- 3) Publicity from the top is also critical, and the 
Ambassador urged the Prime Minister and other Vietnamese 
leaders to speak out on HIV/AIDS.  The influence of 
Vietnam's leadership can be important in our care and 
prevention efforts, the Ambassador stressed, particularly in 
dealing with stigma and discrimination. 
 
¶6. (SBU) On the issue of adoptions, the Ambassador expressed 
the USG's gratitude for the Prime Minister's assistance in 
advancing our adoption program.  By encouraging Vietnam's 
relevant ministries to amend Decree 68, the Prime Minister 
made possible achieving progress toward a pilot program for 
the adoption of special needs orphans. 
 
¶7. (SBU) However, a relationship as complex as that of the 
United States and Vietnam requires further work, the 
Ambassador noted.  Both countries need new embassies, and, 
for its part, the United States has identified land we hope 
to buy.  We want to move forward but cannot because the 
Russians still control the property.  The USG has put aside 
funds to start as soon as possible, but, if we do not start 
soon, these funds may be used somewhere else. 
 
¶8. (SBU) The USG is pleased with the progress we have made 
in bilateral counterrorism cooperation, but we are still 
unhappy with the level of law enforcement cooperation, 
particularly in the area of counternarcotics.  The need for 
increased cooperation with our Drug Enforcement Agency 
personnel is an issue the Ambassador raised with the 
Minister of Public Security (Ref B), he said. 
 
¶9. (SBU) The year 2005 will mark the tenth anniversary of 
the normalization of bilateral relations, and many events 
will commemorate this, including, hopefully, a visit of the 
Prime Minister to Washington, the Ambassador continued.  We 
believe that the PM's visit will send a message about the 
changes in the bilateral relationship and the bright future 
that our ties can have.  We look forward to hearing from the 
PM about how the visit can be organized.  For our part, we 
believe that there are three things to work on in the run-up 
to the Prime Minister's trip: 
 
-- 1) Positive decisions on major commercial projects, such 
as the purchase of Boeing 7E7s and Lockheed-Martin's 
interest in Vinasat, will be important as we prepare the 
groundwork for the Prime Minister's visit; 
 
-- 2) The United States recently designated Vietnam a 
country of particular concern (CPC) regarding a lack of 
religious freedom.  This reflects the serious concern of the 
American people.  We will look closely at the implementing 
regulations for the Ordinance on Religion and, hopefully, 
these regulations will have a positive impact.  There are 
three main issues:  Recognition of new denominations; 
opening new churches in the Central Highlands; and banning 
forced renunciations.  Concrete steps in these areas, as 
well as the vocal support of Vietnam's leadership for the 
concept of religious freedom, will go a long way in changing 
attitudes in the United States regarding the state of play 
on the religious freedom issue in Vietnam; 
 
-- 3) The broader issue of human rights also requires 
attention.  The cases of Nguyen Dan Que and Pham Hong Son 
are troubling to the United States.  We are aware that they 
have been transferred to a prison far from their families. 
Their release, as well as that of Fr. Nguyen Van Ly, perhaps 
under a Tet amnesty, would be warmly welcomed, the 
Ambassador said. 
 
¶10. (SBU) The Prime Minister thanked the Ambassador for 
raising many areas of bilateral progress and many issues 
that require further cooperation.  Vietnam is "delighted" to 
see relations grow in so many areas, such as politics, 
economics, security and defense.  Both countries should 
exert more effort to promote the bilateral relationship. 
Vietnam welcomed the President's decision to grant a 
continuing waiver of Jackson-Vanik and also to include 
Vietnam on the list of priority countries for receiving 
HIV/AIDS assistance.  Vietnam's wish is to receive more 
experts from the United States to fight this epidemic. 
However, the Prime Minister continued, the GVN notes the 
lack of understanding and disagreement between the two 
countries, reflected in the CPC designation and the U.S. 
House of Representative's vote on the Vietnam Human Rights 
Act.  The PM expressed his hope that the Ambassador will 
gain firsthand experience in Vietnam and make "more 
objective recommendations" to Washington such that U.S. 
policy can "reflect the situation more truly." 
 
¶11. (SBU) Turning to trade and economics, the Prime Minister 
noted that the United States and Vietnam spent several years 
negotiating the Bilateral Trade Agreement (BTA).  To date, 
Vietnam has not signed any other trade agreement as 
comprehensive as the BTA.  Considering the low level of 
competitiveness and development of Vietnam's economy, 
Vietnam's decision to sign the BTA reflected "political 
will."  The decision to promote WTO accession also required 
this political will.  For a weak economy such as Vietnam's, 
WTO accession will provide many opportunities as well as 
challenges.  The GVN hopes that the USG will understand 
Vietnam's situation of "being a developing country, with a 
low level of economic development, still facing many social 
and economic problems."  The GVN also hopes that the USG 
will put forward "conditions" to help Vietnam to "strive 
ahead" and asked the Ambassador to ensure that the USG 
negotiating team will not "put forward strict conditions" 
during the bilateral negotiations.  Vietnam is determined to 
accede to the WTO by 2005 and, to that end, has completed 
bilateral negotiations with the EU and is negotiating with 
Japan and the United States. 
 
¶12. (SBU) Trade and investment represent the cornerstone of 
bilateral relations with the United States, the Prime 
Minister continued.  Vietnam looks forward to more 
investments by U.S. companies in Vietnam.  The GVN highly 
values the science and technology and managerial skills that 
U.S. companies can bring.  Regarding Civair, Vietnam's 2010 
aviation development strategy identified Boeing and Airbus 
as the major aircraft manufacturers to supply Vietnam's 
needs.  Vietnam's strategy had further identified Boeing as 
the "supplier for Vietnam's long-haul planes," the Prime 
Minister said. 
 
¶13. (SBU) Aside from economic cooperation, progress in the 
areas of politics and security is important and can promote 
peace and stability in Southeast Asia and Asia as a whole. 
Vietnam thus hopes that the United States and Vietnam can 
reach agreement "defining a framework for long-term 
cooperation" which could also help to overcome "long-term 
bilateral difficulties," the Prime Minister said (Note:  The 
Prime Minister raised this "framework" during Ambassador 
Burghardt's farewell call (Ref C), but we have yet to learn 
exactly what the GVN means by it.  End Note.) 
 
¶14. (SBU) The Prime Minister reiterated his gratitude for 
the President's decision to include Vietnam among the 
countries receiving assistance from the HIV/AIDS relief 
fund.  Vietnam remains inexperienced in this area and hopes 
to receive increased expertise from the United States in 
prevention and treatment.  The problem of HIV/AIDS is 
growing rapidly in Asia and threatening development in many 
countries.  The Prime Minister expressed his "full 
agreement" that Vietnam needs to increase publicity to "help 
people" and that Vietnam's leaders need to speak out more. 
Vietnam looks forward to "receiving more experts" from the 
United States. 
 
¶15. (SBU) Regarding the construction of the future U.S. 
Embassy, Vietnam understands the current embassy is 
"inconvenient" because of the large containers in front of 
it and "inconvenient for a large country like the United 
States."  Vietnam's MFA and Russia have, to date, worked 
together to resolve this issue.  The Prime Minister said he 
"took note" of the Ambassador's request to step up progress, 
adding that he would ask the Ministry of Foreign Affairs to 
redouble its efforts. 
 
¶16. (SBU) On religion and human rights issues, the Prime 
Minister said that Vietnam "recognized" that the United 
States is concerned, but he also expressed his hope that the 
United States understands that all of Vietnam's leaders pay 
attention to problems involving ethnic groups, religion and 
human rights.  The Vietnamese people, regardless of their 
ethnic affiliation or religious beliefs, were involved in 
Vietnam's long struggle.  Therefore, Vietnam put in place a 
policy of national unity to promote economic and social 
development.  Regardless of ethnicity or religious belief 
(or lack thereof), everyone should enjoy equality in 
Vietnam. 
 
¶17. (SBU) If one looked closely at Vietnam's policies, one 
could see that the GVN has a "preference policy" for ethnic 
minorities, the PM continued.  For example, the GVN 
subsidizes many aspects of ethnic minorities' lives, such as 
providing seeds to farmers, paying top price for 
agricultural goods and developing irrigation, electricity 
and transportation infrastructure.  The GVN also builds free 
health clinics, gives financial assistance to the rural poor 
and mobilizes capital to build schools in ethnic minority 
and mountainous areas.  The GVN also sends ethnic minority 
students to boarding schools free of charge and constructs 
housing for ethnic minorities.  Vietnam has learned from 
other countries' experiences that ethnic and religious 
issues are often "difficult to solve."  These are 
complicated issues, but Vietnam's goal is to encourage 
integration into mainstream Vietnamese society, the Prime 
Minister said. 
 
¶18. (SBU) The role of religion in people's lives has grown 
rapidly, particularly since the end of the war and because 
the GVN introduced a policy of "freedom of belief."  The 
number of religious adherents has doubled in recent years, 
as has the number of pagodas, churches and temples.  In the 
Central Highlands, Protestantism has also grown rapidly, and 
the GVN has responded to the demand for more churches by 
allowing their construction.  The GVN prohibits only those 
individuals who would use religion to "jeopardize the 
political situation" or as a "cover to reach out to the 
people politically."  As in other countries, people need to 
obey the law; violators will be punished, the PM said. 
 
¶19. (SBU) As the Ambassador knows, Vietnam recently issued a 
number of resolutions on religious freedom and national 
unity.  The GVN also put in place the Ordinance on Religion 
and would soon promulgate a decree containing the 
implementing regulations for this law.  With regard to the 
particular individuals mentioned by the Ambassador, all had 
violated the law and therefore were put in prison.  Because 
the GVN realized that they are "influential" and have "many 
followers," the GVN gives them "special treatment."  For 
example, in the case of Father Ly, because he complied with 
prison regulations, he was given a reduced sentence.  Also, 
on the occasion of the recent National Day amnesty (Ref D), 
Vietnam released many inmates who are religious followers, 
the PM noted. 
 
¶20. (SBU) Vietnam always hopes to have a "prosperous and 
democratic" society, as Ho Chi Minh expressed in Vietnam's 
Declaration of Independence in 1945.  Under that document, 
which is similar to the Declaration of Independence of the 
United States, the Prime Minister explained, all people have 
the right to religious freedom, democracy and human rights. 
These are the criteria for modern society, and the GVN is 
striving to reach these goals.  The Prime Minister concluded 
by suggesting to the Ambassador that, during his stay, he 
hold a dialogue with Vietnam's relevant ministries on the 
many issues he raised. 
 
¶21. (SBU) Thanking the Prime Minister, the Ambassador noted 
that part of his job is to explain the situation in Vietnam 
more clearly to American citizens and policymakers and, to 
that end, he will engage in discussions with senior 
officials and travel widely.  The United States recognizes 
the political will the GVN exercised to enter into the BTA. 
That this was the right decision is evident in the economic 
fruits Vietnam now enjoys.  As Vietnam exercises the same 
political will to accede to the WTO, it will likely see 
similar results.  There will be more technology transfer and 
investment once Vietnam enters the WTO.  But, part of the 
price for entering the WTO will be increased transparency 
and increased enforcement of intellectual property rights. 
Vietnam is in competition with its neighbors to attract U.S. 
investment.  Issues like tariff increases and the special 
consumption tax for automobiles are watched closely by other 
investors.  The USG hopes that the GVN will continue to work 
with the auto industry on this issue.  Insurance companies 
are also ready to invest in Vietnam, the Ambassador 
continued.  The support of these industries and others will 
be crucial as we approach the debate in the United States 
Congress over Permanent Normal Trade Relations (PNTR) for 
Vietnam. 
 
¶22. (SBU) We recognize that Vietnam is working hard to 
address the problems of ethnic minorities in the Central 
Highlands, the Ambassador said.  The United States would 
like to offer financial and technical assistance in this 
effort.  But, a signal from the Prime Minister and other 
leaders to local authorities to encourage working with 
foreign nongovernmental organizations and American 
assistance would be good.  However, we believe that, no 
matter what the GVN does, some people will still want to 
leave Vietnam, and the issue of those crossing the border 
into Cambodia is of grave concern to the USG.  The USG is 
thus ready to accept a number of individuals for 
resettlement, but they need travel documents.  It would be 
useful for the Central Government to encourage local 
authorities to expedite the necessary procedures such as the 
issuance of travel documents.  The Ambassador concluded by 
noting that he and the Prime Minister still had not had the 
chance to discuss the PM's visit to the United States. 
 
¶23. (SBU) The Prime Minister responded by thanking the 
United States for the invitation to visit and expressed his 
hope that the U.S. Embassy and the Department will continue 
to work with the Vietnamese MFA to make the necessary 
arrangements.  The United States occupies an important part 
of Vietnam's foreign policy, and high-level visits -- such 
as the PM's trip to the United States in 2005 and the U.S. 
President's visit to Vietnam in 2006 on the occasion of the 
APEC summit -- will play an important role in promoting the 
bilateral relationship, the PM said. 
 
¶24. (SBU) On the issue of ethnic minorities in the Central 
Highlands "fleeing Vietnam," Ksor Kok and his Montagnard 
Foundation in the United States are largely responsible for 
this.  They tell Montagnards that they will have a better 
life if they leave Vietnam, and their aim is to "destabilize 
Vietnam."  "You can trust me that we will do everything we 
can to convince our people that no one can help them better 
than the GVN," the Prime Minister concluded. 
 
MARINE