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DE RUEHHI #0225/01 0570914
ZNR UUUUU ZZH
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FM AMEMBASSY HANOI
TO RUEHC/SECSTATE WASHDC 7264
INFO RUEHHM/AMCONSUL HO CHI MINH 4340
RUEHZS/ASEAN REGIONAL FORUM COLLECTIVE

UNCLAS SECTION 01 OF 07 HANOI 000225 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
FOR A/S HILL FROM AMBASSADOR MICHALAK 
 
STATE FOR EAP/MLS 
 
E.O. 12958: N/A 
TAGS: PREL PGOV OTRA ECON VM
SUBJECT: SCENESETTER FOR ASSISTANT SECRETARY HILL VISIT TO VIETNAM 
 
 
HANOI 00000225  001.2 OF 007 
 
 
Summary and Introduction 
------------------------ 
 
¶1. (SBU) Ambassador Hill: Mission Vietnam looks forward to welcoming 
you back to Hanoi.  Your visit is well timed to focus Vietnamese 
leaders on the importance we attach to strengthening and deepening 
our bilateral relationship in the year ahead, especially after bad 
weather in China forced the last-minute cancellation of Deputy 
Secretary Negroponte's visit to Vietnam last month.  Overall, the 
 
SIPDIS 
U.S.-Vietnam relationship continues to broaden and mature, and the 
transformation of the economic, social and technological landscape 
continues to create "space" for Vietnam's people, including a 
greater ability to be heard.  The young generation is increasingly 
networked, and does not harbor the deep anti-Americanism we find in 
some of their older compatriots.  Indeed, the United States is 
viewed by the majority of Vietnamese as a key partner in Vietnam's 
current and future success.  We are finding opportunities to 
influence developments here, responding to Vietnam's own interest in 
globalization, reform of economic governance, combating corruption, 
progress toward improvement in overall governance, and enhancing 
educational opportunities for its people. 
 
¶2. (SBU) There is much to discuss.  Vietnam's economic successes 
have translated into greater international clout, especially in the 
region.  Vietnam's role as a non-permanent member of the UN Security 
Council has raised its international profile.  Hanoi is not fully 
sure how to handle all the attention, but understand that the United 
States has - and is - playing a direct role in creating the 
conditions for their nation's success.  Leaders here are thankful, 
in particular, for the key technical assistance we've given over the 
past seven years in reforming the system of economic governance. 
 
¶3. (SBU) Challenges of course remain.  GVN leaders argue that 
maintaining the Party's preeminent political role is critical to 
preserving stability.  Conservatives still seek to use issues like 
Agent Orange, as well as other "war legacy" issues, to put the 
United States in a bad light.  China remains Vietnam's critical 
strategic preoccupation, and this can complicate our efforts to 
engage in some key areas.  At the same time, Vietnam's leaders also 
realize that the United States is an important force in maintaining 
a stable geopolitical environment in which even "small" countries 
like Vietnam are assured their independence and freedom of action. 
As Vietnam continues its rapid economic and social transition, many 
Vietnamese view the strength of its relations with the United States 
as a key indicator of how much progress has been made in leaving the 
dark days of the 1970's and 1980's behind.  For these reasons, 
Vietnam's leaders are committed to continued progress in bilateral 
relations and will likely speak positively and optimistically about 
the future of U.S.-Vietnam ties. 
 
¶4. (SBU) One of the key drivers for the substantial enhancements in 
our relationship over recent years has been the top-level visit. 
Since 2005, there has been one formal visit between involving either 
the Vietnamese Head of State or Head of Government with President 
Bush each year.  These have definitely proven their worth in 
spurring positive changes in Vietnam, as well as in pinning down 
those in Vietnam who might otherwise work to sidetrack or limit 
those advances.  The White House has invited Prime Minister Nguyen 
Tan Dung to Washington in 2008.  We are working to confirm the Prime 
Minister's intention to come and to settle upon dates. 
 
The Economy, WTO and Investment 
------------------------------- 
 
¶5. (SBU) Vietnam's dynamic economy grew by 8.5% in 2007 and has 
averaged over 7.5% for the past decade.  Per capita annual income 
jumped from about $220 in 1993 to over $800 in 2007.  Since 1986, 
the Vietnamese government has continued to implement an economic 
reform program known as "Doi Moi" (renovation).  As a result, 
effective market-oriented policies have improved the quality of life 
for many Vietnamese and have succeeded in slashing the poverty rate 
from 58% in 1993 to well under 25% today.  Increased trade and 
foreign direct investment have been key drivers in Vietnam's 
economic growth.  Vietnam formally acceded to the WTO as its 150th 
member on January 11, 2007.  While its chief exports are crude oil, 
apparel, footwear and aquatic products, Vietnam is also increasing 
its exports of furniture, machinery, cameras, computers, printers, 
consumer electronics, coffee, rice and other diverse products.  The 
United States is currently Vietnam's third largest overall trade 
partner (behind China and Japan), but remains its largest export 
market.  The GVN still needs to meet the challenges of expanding 
infrastructure, increasing energy production, stamping out 
corruption, transforming state-owned enterprises (SOEs) into more 
competitive entities, improving worker and professional skills, 
implementing WTO commitments, and maintaining the course of reform. 
 
Humanitarian and Technical Assistance 
 
HANOI 00000225  002.2 OF 007 
 
 
------------------------------------- 
 
¶6. (SBU) Since 1995, U.S. Agency for International Development 
(USAID) programs have provided aid in legal reform, governance, 
economic growth, HIV/AIDS, environmental protection and disaster 
prevention.  For FY 2007, total U.S. aid from all agencies was about 
USD 86.6 million, the bulk of which has gone towards providing 
health-related assistance, notably in the area of HIV/AIDS treatment 
and prevention and the fight against avian influenza.  Vietnam is 
one of fifteen countries in the President's Emergency Plan for AIDS 
Relief (PEPFAR).  The United States provided USD 65 million in FY 
2007 to expand integrated HIV/AIDS prevention, care and treatment 
programs.  The FY 2008 expenditure has increased to around $88 
million.  Since 2000, DOD has supported a wide variety of Overseas 
Humanitarian, Disaster and Civic Aid (OHDCA) projects in Vietnam. 
Additionally, USPACOM has facilitated multiple donations of excess 
medical property to various medical facilities throughout Vietnam. 
 
 
7.(SBU) Since 1998, U.S. Centers for Disease Control and 
Prevention(USAID) has had a presence in Vietnam.  From 1998, CDC 
provided technical assistance for programmatic implementation, 
training, disease surveillance, and program monitoring for HIV/AIDS. 
 Since 2005, CDC has provided in-country technical support for 
influenza surveillance, rapid response, and emergency disaster 
planning.  CDC has also provided technical assistance for emergency 
outbreak response for diseases including SARS. 
 
¶8. (SBU) U.S. assistance in areas other than HIV/AIDS remains very 
modest in relation to spending in smaller neighboring nations, but 
increased substantially in FY08 from that low base to over $10 
million due to earmarks for governance programming and demining. 
The Administration's FY09 request roughly equals the total for FY08. 
 To a large degree, the FY08 earmarks reflect a recognition that 
several U.S. programs are having a profound impact here.  The "STAR" 
(Support for Trade Acceleration) program, for example, has played a 
major role in helping Vietnam to reshape its trade and commercial 
laws and regulations.  While initially established to help Vietnam 
comply with its obligations under the 2001 Bilateral Trade 
Agreement, STAR also played a critical role in Vietnam's 
preparations for WTO membership and its broader entry into the 
global economic system.  Another relatively small program, the 
Vietnam Competitiveness Index (VNCI), is having a profound impact on 
promoting good economic governance domestically by providing a 
quantitative measure of the impact of governance and rule of law on 
economic development.  Provinces' rankings on the annual VNCI report 
are closely watched and leaders of provinces that score well have a 
particularly good chance of being promoted to more senior positions 
in Hanoi.  VNCI also provided the Prime Minister's Office with key 
support in developing an "economic guillotine," which is designed to 
greatly cut red tape at the provincial level.  If successful, this 
program will have a huge positive impact on governance throughout 
the country. 
 
¶9. (SBU) Through a combination of Fulbright grants and the Vietnam 
Education Foundation (VEF), an innovative program created through 
legislation to facilitate the training of Vietnamese scientists, the 
United States is now sponsoring well over 200 students for graduate 
study in the United States.  The VEF was established with the unpaid 
proceeds of loans extended to the old South Vietnamese government. 
Another important activity is the Fulbright Education Training 
Program (FETP), through which 70 mid-level Vietnamese professionals 
receive in-country training in economics and public policy each year 
in a program run by Harvard University.  Today, nearly 1,000 FETP 
alumni are working in government and private sector positions 
throughout the nation. 
 
¶10. (U) I hosted an Education Conference in Hanoi January 24-25 to 
help spur forward both public and private American efforts in 
education in Vietnam.  The Conference was a forum for American 
universities, companies, NGOs and USG-funded educational programs to 
generate ideas and action plans about how best to meet three 
principal goals: a significant increase in the flow of Vietnamese 
students to the United States, more and deeper linkages between 
American and Vietnamese universities, and higher quality of human 
resources in the pool from which American companies in Vietnam hire. 
 Over 200 participants attended, including representatives of some 
of the largest U.S. companies operating here.  Collectively, we have 
built momentum toward achieving our three objectives that I will 
work to maintain. 
 
UNSC and Global Security Issues 
------------------------------- 
 
¶11. (SBU) Vietnam's UNSC membership creates a window of opportunity 
to encourage Vietnam to speak out in a constructive way on global 
security issues, and to help Hanoi distance today's Vietnam from the 
 
HANOI 00000225  003.2 OF 007 
 
 
NAM and Communist-Bloc focus driving its old-style foreign policy. 
We have been proactive here and in Washington in educating GVN 
leaders and officials on Burma, North Korea and Iran, where in the 
past it has been unwilling to engage constructively with us due to 
"traditional friendship" and non-interference.  Despite repeated 
demarches the GVN has so far this year, Vietnam lined up against our 
positions in UNSC debates on Burma and Kosovo.  You will want to 
note this, and call on Hanoi to engage more constructively with us 
as we move forward. 
 
¶12. (SBU) As it raises its profile on the world stage, Hanoi has 
expressed a general willingness to prepare its military for 
participation in UN peacekeeping operations at some point in the 
future. At the same time, the GVN has proven reluctant to engage 
with us bilaterally on training, despite our invitation to 
participate in PKO training through the Global Peace Operations 
Initiative.  A key factor in Hanoi's reluctance is that such 
engagement will set a precedent for security cooperation that 
requires difficult internal negotiations and decisions. 
Additionally, the GVN lacks a recent precedent for military 
engagement beyond Vietnam's borders, which would reportedly require 
legislative action to authorize.  We emphasize that taking the first 
steps toward PKO training does not require a commitment on Hanoi's 
part, and are still hopeful that Vietnam will participate in GPOI 
beginning later this year. 
 
¶13. (SBU) Vietnam says the right things about the threat of global 
terrorism and has participated with us in modest cooperative 
activities.  During President Bush's visit in 2006, the President 
and his Vietnamese counterpart pledged to increase cooperation to 
halt the proliferation of weapons of mass destruction and related 
technology and materials in accordance with international and 
national laws and each country's capacities.  The United States 
provides counterterrorism assistance to Vietnam by funding 
Vietnamese participation in counterterrorism-related training at the 
International Law Enforcement Academy (ILEA) in Bangkok, and through 
military-to-military exchanges with an emphasis on counterterrorism 
themes.  Vietnam has signed eight out of thirteen UN terrorism 
conventions.  Approval of the remaining five is winding its way 
through the cumbersome GVN bureaucracy, the delay explained in part 
by GVN concern with its capacity to carry out obligations under the 
conventions.  Two of the remaining conventions are reportedly in the 
final stages of GVN approval, while the status of the other three 
remains unclear. 
 
Challenges on Human Rights 
-------------------------- 
 
14.(SBU) While we share common views with the GVN in many areas, 
differences over human rights remain, and lingering fears that the 
United States supports the overthrow of the current regime continue 
to complicate the relationship.  The existence of groups in the 
United States and elsewhere that continue to explicitly advocate 
regime change helps generate negative charges by conservatives here 
which stoke a lingering paranoia that we are indeed still "the 
enemy." Reassuring the GVN that the USG does not support separatist 
groups can assist in building a better human rights dialogue based 
on mutual trust. 
 
¶15. (SBU) Serious deficiencies related to human rights in Vietnam 
include lack of freedom of speech, freedom of assembly and freedom 
of the press.  One of our key objectives is to end the use of 
catch-all "national security" provisions such as Article 88 of the 
GVN criminal code, which prohibits "conducting propaganda against 
the State."  The U.S. Mission tracks approximately 50 individual 
cases of prisoners of conscience and activists under various forms 
of house arrest, surveillance, and/or harassment.  We continue to 
call for the release of all prisoners of conscience and freedom of 
peaceful expression of political views, but where we see individuals 
expressing their political opinions, many of our government 
interlocutors see "lawbreakers" trying to destabilize the regime. 
 
¶16. (SBU) Perceptible progress is, however, being made.  Key 
Vietnamese leaders are committed to enhancing governance 
establishing the rule of law, and combating corruption, all critical 
in building guarantees of individual freedoms.  Vietnam's leading 
newspapers are more aggressive in terms of the types of news they 
publish and their willingness to push back against censors.  Only a 
few years ago, any protest resulted in swift and severe police 
action.  Over this past year, various peaceful protests occurred 
involving issues such as land rights, opposition to Chinese 
territorial claims, and demands for the return of Catholic Church 
property, with one stretching out for a month before it finally 
ended peacefully.  With regard to religious freedom, Vietnam has 
made surprising progress, in large part due to the intensive 
engagement of Ambassador Hanford over recent years.  More needs to 
be done, but the country no longer qualifies as a particularly 
 
HANOI 00000225  004.2 OF 007 
 
 
severe violator of religious freedom under our legal definition and 
we removed the nation from the list of countries of particular 
concern in late 2006. 
 
More on Vietnamese Concerns About China 
--------------------------------------- 
 
¶17. (SBU) While Vietnam's engagement with the United States will 
continue to broaden, China necessarily constitutes Vietnam's most 
important strategic preoccupation.  This is not to say that Vietnam 
is "choosing" China over the United States; the situation is much 
more complex than that.  For starters, Vietnam's leadership is 
sophisticated enough to realize that relations with China and the 
United States do not represent a zero sum game; it is possible to 
have good relations with both.  Each relationship also creates 
challenges, however.  While China constitutes a vital and necessary 
commercial partner and former ally, it is also perceived as a 
significant and frustrating constraint to Vietnam's freedom on 
action. 
 
¶18. (SBU)  Chinese bullying of foreign companies in an attempt to 
compel them to cease oil and gas exploration efforts in the South 
China Sea serves to remind Vietnamese officials that while the 
Vietnamese may not approve of all U.S. policies, the same is 
certainly true of Chinese actions.  While progress has been made in 
settling the land border, there is no commonality of views on 
sovereignty issues regarding the South China Sea, known as the "East 
Sea" to the Vietnamese.  Hanoi is also "riding the tiger" with 
regard to managing the deep negative views toward China of many 
Vietnamese.  China is widely disliked and distrusted as a former 
colonial master, and Beijing's actions in the Spratlys and Paracels 
threaten to inflame those passions.  Should Hanoi allow 
unconstrained protests against the Chinese, however, it would appear 
weak in the face of calls to action that it could not satisfy, as 
well as risking Beijing's anger. 
 
¶19. (SBU) On security matters, China looms large.  There is an 
understandable GVN caution with regard to China's potential reaction 
to enhancements in Vietnam's cooperation with the United States. 
U.S.-Vietnam cooperation in the security field is also constrained 
by an institutional conservatism born of concern over "peaceful 
evolution" as a real threat to the regime, as well as by an 
ingrained caution on the part of Vietnam's military in the face of 
relative power calculations vis-a-vis China. 
 
Gradual Progress in Defense Cooperation 
--------------------------------------- 
 
¶20. (SBU) Defense relations have nonetheless advanced at a measured 
pace, and have actually come quite far if viewed over the past 
decade.  We are in year three of a new IMET program, and we now have 
professional military exchanges with the People's Army of Vietnam 
(PAVN) in a limited but growing range of areas including military 
law, military nursing, public affairs, search and rescue, 
meteorological/ oceanographic (METOC) prediction, and disaster 
preparedness.  Since 2003, U.S. Navy ships have made five port 
visits to Vietnam, including most recently a November 14-18 visit by 
two mine countermeasures ships, the USS Guardian and the USS 
Patriot, at Haiphong port.  The USS Mercy is set to visit Nha Trang 
this spring on a humanitarian mission, following the very 
successful, similar visit by the USS Peleliu last summer.  Reaching 
our full potential for closer cooperation in defense activities, 
including multilateral peacekeeping, humanitarian assistance efforts 
and attendance at U.S. military schools is attainable, but will 
require time, persistence and patience, and a lot of hard work. 
 
Fullest Possible Accounting 
--------------------------- 
 
¶21. (SBU) Predating the re-establishment of diplomatic relations and 
normal defense contacts, U.S. military and DoD elements continue 
their efforts toward the fullest possible accounting of Americans 
missing from the Vietnam Conflict.  Since 1988, the Joint POW/MIA 
Accounting Command (JPAC), a USPACOM subordinate element, has 
evolved to include forward Detachments in Vietnam, Laos, and 
Thailand/Cambodia.  With its Vietnam Detachment (Det 2), it has 
completed 90 Joint Field Activities (JFA), which incorporated 
extensive research, interviews, analysis, and excavations in order 
to accomplish its mission.  From its inception, Det 2 has forged 
good relations with its GVN counterparts.  Ultimately, JPAC's 
efforts in Southeast Asia have resulted in accounting for 880 
Americans previously listed as MIA; 1766 remain missing throughout 
Southeast Asia. 
 
¶22. (SBU) An area of heightened bilateral cooperation is the 
undertaking of investigation and recovery efforts at sea.  During 
the Vietnam Conflict, more than 400 American aviators were lost in 
 
HANOI 00000225  005.2 OF 007 
 
 
the waters off the coast of Vietnam.  While the majority of those 
Americans were declared dead and their remains deemed not 
recoverable, JPAC continues to conduct underwater investigation and 
survey activity when information obtained and validated has the 
potential to lead to a recovery.  This is a resource-intensive 
endeavor.  In December, 2006 the GVN gave its approval for the use 
of U.S. naval vessels to operate within their territorial waters in 
order to enhance JPAC's underwater investigations towards the 
identification of potential recovery sites. 
 
Consequences of War 
-------------------- 
 
¶23. (SBU) In your meetings, you may hear references to "consequences 
of war" or "legacies of war" issues, especially given the recent 
U.S. Court of Appeals decision to dismiss the lawsuit against 
American chemical companies.  In addition to Agent 
Orange(AO)/Dioxin, however, "legacy" issues include unexploded 
ordnance (UXO) and land mines from the war era and the recovery of 
missing Vietnamese military personnel. 
 
¶24. (SBU) On Agent Orange, while scientists and GVN officials 
continue to debate the human impact of the 80 million liters of AO 
sprayed over 2.6 million hectares and 3,000 hamlets in Vietnam, 
recent GVN-approved studies reveal that Dioxin contamination is not 
widespread, but rather is concentrated in roughly 20 "hotspots." 
Former U.S. bases, from which Operation Ranch Hand missions were 
staged and AO was stored, have soil dioxin concentrations exceeding 
concentration levels recommended by the U. S. Environmental 
Protection Agency (EPA) and World Health Organization, while other 
areas thought to be targets of heavy aerial spraying do not 
currently have soil concentrations considered hazardous to health. 
 
¶25. (SBU) Much has been accomplished recently in turning a new leaf 
on the AO/Dioxin issue with regards to government-to-government 
relations and changing the tone of the dialogue both in meetings and 
in the press.  Beginning in 2006, the State Department and EPA 
provided USD 400,000 in technical assistance to the GVN's Office 33 
and MOD's Chemical Command for remediation planning and immediate 
interventions at the Danang airport.  Congress appropriated an 
additional USD 3 million in Economic Support Funds (ESF) for "dioxin 
mitigation and health activities," thereby helping Vietnam to 
remediate areas with demonstrably high levels of dioxin and assist 
those with disabilities.  This follows four years of USG support to 
build the capacity of the Vietnam Academy of Science for analysis of 
contaminated soils and sediment.  The USG is continuing to work 
together with the GVN, UNDP, Ford Foundation and other NGOs to 
discuss the next steps in the environmental remediation of three 
priority hotspots in Danang, Hoa Binh and Phu Cat airfields. 
 
¶27. (SBU) Since 1989, USAID, through support from the Patrick J. 
Leahy War Victims Fund (LWVF) and other sources, has provided over 
USD 43 million to support NGOs and private voluntary organizations 
to develop comprehensive programs for people with disabilities.  In 
addition, since 1993 the USG has been actively involved in assisting 
the people of Vietnam in overcoming the social and economic impacts 
of remaining UXO from the war.  Vietnam was formally accepted as the 
37th participant in the U.S. Humanitarian De-mining Program in June 
2000, and the USG is now the largest donor of humanitarian 
assistance for mine action programs in Vietnam.  The USG has 
invested over USD 37 million in a broad spectrum of programs not 
only to locate, remove and destroy unexploded ordnance and 
landmines, but also to address the UXO effects on health and 
livelihood of Vietnamese living in affected areas. 
 
¶28. (SBU) Today, various NGOs conduct UXO and land mine clearance, 
risk education and victim rehabilitation. The USG has also donated a 
significant quantity of equipment to the PAVN to assist efforts in 
UXO and landmine clearance and return land to productive use.  In 
2006, the State Department provided USD 3.5 million to support UXO 
action and demining activities in Vietnam, almost a third of which 
went directly to PAVN in the form of donated demining equipment. 
FY08, an additional USD 2.5 million will be provided to underwrite 
mine action related activities in Vietnam.  For FY08, Congress 
dictated that approximately $2.5 million be spent on demining 
programs, a substantial increase from the $800,000 requested by the 
Administration. 
 
Adoption Issues 
--------------- 
 
¶29. (SBU) Baby and child buying are serious and troubling issues in 
Vietnam and in recent weeks have captured the attention of national 
- and international - media.  In the meantime, Vietnamese 
authorities, stung by revelations of fraud and other abuses, are 
harassing our consular officers as they try to verify cases.  We 
have informed the GVN that we will not renew the current bilateral 
 
HANOI 00000225  006.2 OF 007 
 
 
agreement, which permitted the resumption of adoptions by American 
parents in 2006, without changes.  This raises the question of 
whether adoptions will be permitted after September.  The clear "way 
forward" for Vietnam is to accede to the Hague Convention on 
Inter-Country Adoption, which it says it wishes to do, as soon as 
possible.  In the interim, we are working within the USG to 
determine our next steps. 
 
 
Management Issues: New Embassy Compound, APP Danang 
--------------------------------------------- ------ 
 
¶30. (U) The economic dynamism described above has pushed Vietnam to 
a stage of development where a significant number of people have the 
ability and desire to travel to the USA for pleasure, family visits 
or education.  The impact of this economic shift is being felt 
particularly hard at ConGen HCMC where the total number of NIV 
applications processed has climbed by nearly 110 percent in just two 
years (2006-2007).  The total number of student (F) visas is up a 
whopping 275 percent during the same period.  Other consular units 
(immigrant visas, American Citizen Services, the Fraud Prevention 
Unit) have also experienced significant, albeit less spectacular 
increases in workload.  Unfortunately, consular staffing at ConGen 
HCMC has remained unchanged during this period of continuing rapid 
increase in demand.  ConGen HCMC's consular section is in need of 
immediate staffing increases.  In addition, the consulate needs to 
start planning for physical expansion now since there are not enough 
interview windows to handle the rapidly growing volume. 
 
¶31. (SBU) When we established diplomatic relations in 1995, Scot 
Marciel helped us find an "interim" building to set up initial 
operations and carry us through our first years.  It was a good 
"fix" at the time.  Thirteen years later, however, we're still 
there.  As you know from your previous visits, our facilities are 
overcrowded, inefficient, insecure, and just plain ugly.  The long 
term solution involves the construction of a New Embassy Compound 
(NEC), a "priority" deferred for over ten years.  U.S. interests in 
Vietnam dictate that we create an appropriate platform in Hanoi for 
our diplomatic activities in this increasingly important nation.  We 
recently received a counter-offer from the GVN that should provide 
the basis for further negotiations for the NEC land purchase.  Even 
if our negotiations progress, it will be many years before we cut a 
ribbon on an NEC.  OBO recognizes the need for expansion of our 
office space in the interim. 
 
¶32. (SBU) State Department budget limitations will delay the 
scheduled opening of APP Danang at least until FY2009.  Although we 
have not had formal negotiations with GVN officials regarding the 
opening of the APP, informal soundings indicate that they are quite 
receptive to the idea.  We hope a way can be found to begin 
negotiations "in principle" with the GVN on new consulates.  This 
will allow us to get necessary agreements in place before our side 
decides to begin allocating funds.  Meanwhile, we also face critical 
space issues in Ho Chi Minh City.  All agree, for example, that the 
Consular Section, which is experiencing rapid growth in workload, 
will soon be inadequate for our needs.  Again, OBO recognizes this 
priority.  The expansion of other offices in HCMC will also create 
issues in our rented space there. 
 
What You Can Expect 
------------------- 
 
¶33. (SBU) You can expect your interlocutors not only to be 
articulate and well informed, but also to speak in terms generally 
supportive of growth in the bilateral relationship.  As noted above, 
lingering suspicions still exist among conservatives in leadership 
about the development of closer ties with the United States, and it 
will be interesting to see if your interlocutors feel the need to 
raise the U.S. court decision regarding the "Agent Orange victims." 
Nonetheless, I fully expect the overall tenor to be one of support 
and interest at a measured pace that will not upset the GVN's 
calibrated attempts to maintain balance among its other regional 
partners.  Your upcoming trip to Hanoi will add momentum to our 
efforts to help translate those good feelings into measurable 
accomplishments in our bilateral relationship. 
 
¶34. (U) Media interest in your visit is high, both among Vietnamese 
and international outlets.  We are making arrangements for a press 
conference and, in addition to questions on the purpose of your 
visit and the results or your meetings, would anticipate questions 
on China, the DPRK, human rights and the arrest of several American 
citizens suspected of membership in an anti-government organization, 
one of whom remains in Vietnamese custody. 
 
¶35. (SBU) Again, we look forward to your visit and stand ready to do 
everything we can to make your visit to Vietnam as productive as 
possible. 
 
HANOI 00000225  007.2 OF 007 
 
 
 
MICHALAK