VZCZCXRO3846
RR RUEHCHI RUEHDT RUEHHM RUEHNH
DE RUEHHI #1731/01 2750957
ZNR UUUUU ZZH
R 020957Z OCT 07
FM AMEMBASSY HANOI
TO RUEHC/SECSTATE WASHDC 6440
INFO RUEHHM/AMCONSUL HO CHI MINH 3754
RUEHBJ/AMEMBASSY BEIJING 6983
RUCNASE/ASEAN MEMBER COLLECTIVE
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC

UNCLAS SECTION 01 OF 02 HANOI 001731 
 
SIPDIS 
 
STATE PASS USTR FOR DBISBEE 
USDOC FOR 4430/MAC/ASIA/OPB/VLC/HPPHO 
 
SENSITIVE 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: KTEX ECON EIND ETRD ETTC VM
SUBJECT: VIETNAM FRETS OVER ANTI-DUMPING POLITICS DESPITE CONFIDENCE 
IN ITS NUMBERS 
 
REF: (A) HANOI 1654; (B) HCMC 995 
 
HANOI 00001731  001.2 OF 002 
 
 
¶1. (SBU) Summary:  The Vietnamese government (GVN) and apparel 
industry are confident that the data gathered by the Department of 
Commerce's import monitoring program will vindicate their claims 
that the country is not dumping apparel exports to the United 
States.  In his meetings with concerned GVN and apparel sector 
audiences in Hanoi, Import Administration Assistant Secretary David 
Spooner underscored that the facts and the figures, not politics, 
will guide the program's first report, due in early November.  End 
summary. 
 
CONFIDENCE IN THE NUMBERS... 
---------------------------- 
 
¶2. (SBU) In meetings in Hanoi on September 26 and 27, GVN and 
apparel industry representatives told A/S Spooner that the data 
gathered and reported so far by the Commerce Department shows that 
apparel exports' growth has been moderate and prices have not dipped 
below market averages.  They claimed that Vietnam's aggressive 
anti-dumping stance --which includes monitoring its own exports and 
lobbying the U.S. textile and retail sectors -- should ensure a 
clean sheet for Vietnam when Commerce issues its first import 
monitoring report.  A/S Spooner told his interlocutors that he 
expected to issue the report no later than the first week of 
November, ahead of the U.S. trade mission to Vietnam led by Commerce 
Secretary Carlos Gutierrez. 
 
SIPDIS 
 
¶3. (SBU) According to the Ministry of Industry and Trade (MOIT) and 
the Vietnam Textile and Apparel Association (VITAS), first-half 2007 
apparel exports to the United States were up by 20% over the same 
period in 2006, and below the 26% growth in Vietnam's other apparel 
export markets.  "The increase this year is moderate, and is indeed 
lower than when we had quotas," MOIT Minister Vu Huy Hoang said. 
Meanwhile, VITAS Chairman Le Quoc An pointed that Vietnam's average 
price of $3/sq. mt. was double that of China.  MOIT Vice-Minister 
Bui Xuan Khu added that many if not most of the garments that 
Vietnam exports to the United States are in categories where the 
U.S. market depends almost exclusively on imports. 
 
...AND IN ITS ANTI-DUMPING EFFORTS 
---------------------------------- 
 
¶4. (SBU) The GVN and the apparel sector also cited their efforts in 
reaching out to U.S. businesses.  VITAS Chairman An told A/S Spooner 
that a joint GVN-apparel industry delegation had met in Washington 
in September with representatives from the National Council of 
Textile Organizations (NCTO) to assuage the NCTO's fears of direct 
competition with Vietnam's exporters.  While in Washington, the 
delegation also met with Import Monitoring staff from the Department 
of Commerce and offered data from Vietnam's own internal monitoring 
mechanisms, which the Vietnamese claim is wholly consistent with the 
Commerce numbers published so far.  The delegation also lobbied the 
American Apparel and Footwear Association, the National Retail 
Federation, and the Retail Industry Leaders Association, among 
others. 
 
CONCERNS ABOUT THE POLITICAL DEBATE 
----------------------------------- 
 
¶5. (SBU) Despite the GVN and apparel sector's confidence in the 
numbers, they expressed concerns that politics would play a role in 
Commerce's review of the data.  A/S Spooner underscored that the 
report would be factual and that there was "no secret deal to keep 
Vietnamese imports out."  At an industry roundtable, the 
apprehensive GM of a garment factory in the outskirts of Hanoi 
summed up the general feeling by saying: "The data doesn't concern 
me, what worries me is the political debate over the data."  A/S 
Spooner acknowledged a deteriorating political climate on trade 
liberalization but admitted that to date no domestic apparel company 
had claimed market injury by Vietnamese imports.  "Our commitment 
was to monitor imports not to initiate [an anti-dumping] case." 
 
¶6. (SBU) Both the GVN and the apparel manufacturers restated their 
preoccupation with the monitoring program's potential chilling 
effect on orders.  Many Vietnamese businesses complained that 
customers in the United States have refrained from placing orders 
for fears of anti-dumping measures.  For their part, Minister Huong 
and his deputies cautioned against disruptions in a sector that 
employs directly over two million workers. 
 
COMMENT 
------- 
 
¶7. (SBU) Although the first report of the import monitoring group is 
 
HANOI 00001731  002.2 OF 002 
 
 
still pending, the GVN and the textile sector are confident that 
there is no dumping.  A/S Spooner's visit was timely in setting the 
record straight that politics will not play a role in the report. 
 
¶8.  (U) A/S Spooner cleared this cable. 
 
MICHALAK