VZCZCXRO1531
RR RUEHHM
DE RUEHHI #0018/01 0061030
ZNR UUUUU ZZH
R 061029Z JAN 10
FM AMEMBASSY HANOI
TO RUEHC/SECSTATE WASHDC 0693
INFO RUEHGP/AMEMBASSY SINGAPORE 0056
RUEHHI/AMEMBASSY HANOI
RUEHHM/AMCONSUL HO CHI MINH CITY 0345

UNCLAS SECTION 01 OF 11 HANOI 000018 
 
SENSITIVE 
SIPDIS 
DEPARTMENT FOR EAP/MLS 
EMBASSY SINGAPORE PASS TO BOND 
 
E.O. 12958: N/A 
TAGS: OREP PREL PGOV PHUM MARR ECON SENV VM
SUBJECT: SETTING THE SCENE FOR CODEL BOND VISIT TO VIETNAM 
 
¶1.  (SBU) SUMMARY: U.S.-Vietnamese relations have advanced 
 
significantly over the past three years and are arguably at 
 
their most productive since relations were reestablished in 
 
¶1995.  We are Vietnam's largest export market, its third- 
 
largest trading partner, and one of its largest foreign 
 
investors.  We have broadened our cooperation in public 
 
health, education, mine clearance, and WTO and BTA compliance. 
 
Strategically, Vietnam views the U.S. presence in the region 
 
as a force for stability, and security cooperation has 
 
expanded as our two militaries explore opportunities to 
 
cooperate effectively.  Powerful conservative voices in 
 
Vietnam's Communist Party and security services, including the 
 
military, remain wary of U.S. intentions, but their influence 
 
will wane over time as the country's young population -- the 
 
first generation in memory to live without war -- increasingly 
 
looks to the West.  At the same time, we continue to engage 
 
with our Vietnamese counterparts to remove the few remaining 
 
war legacy issues, including Agent Orange/dioxin and 
 
unexploded ordinance, and are moving forward on joint efforts 
 
to confront climate change, a keen concern for Vietnam, which 
 
is particularly vulnerable to rising sea levels. 
 
 
 
¶2.  (SBU) Profound differences remain, however, particularly 
 
in our approach to human rights.  Vietnam has made strides in 
 
religious freedom, but the situation surrounding political 
 
rights and press freedoms has worsened as the Party clamps 
 
down on dissent in advance of the January 2011 Party Congress. 
 
Our approaches to international issues also differ.  Vietnam's 
 
performance on the UN Security Council has been lackluster and 
 
its non-interventionist line has caused it to align with 
 
Russia and China on issues such as Burma, Georgia, and Darfur. 
 
Vietnam has a chance to exercise leadership in the region as 
 
ASEAN chair beginning in January 2010, but will require 
 
sustained, considerable U.S. support and prodding to tackle 
 
tough issues like Burma.  Your visit provides an opportunity 
 
to reiterate our commitment to deepening bilateral relations 
 
across the board, while reminding senior GVN leaders that 
 
future progress will be affected by the degree to which 
 
Vietnam respects human rights and the wishes of its people to 
 
have a more inclusive, responsive government.  END SUMMARY. 
 
 
 
Foreign Policy Priorities: China and the United States 
 
--------------------------------------------- --------- 
 
HANOI 00000018  002 OF 011 
 
 
¶3.  (SBU) Vietnam professes that it is "friends to all," a 
 
slogan that sounds naive but reflects a fundamentally 
 
pragmatic approach to foreign policy.  Vietnam's overriding 
 
strategic concern remains China.  Hanoi is realistic about the 
 
power imbalance and is wary of antagonizing its neighbor. 
 
Hanoi is also under no illusions that it can somehow "balance" 
 
China with the United States, Russia, or Japan individually. 
 
Nor is a more confrontational approach toward China something 
 
the Party tolerates domestically: once unleashed, 
 
nationalistic sentiment, though initially directed at China, 
 
could easily turn toward the Party itself.  Instead, Vietnam 
 
seeks to maintain as cordial and stable a relationship with 
 
China as possible, while also cautiously cultivating a diverse 
 
range of bilateral friendships and enmeshing these in a 
 
framework of multilateral engagement.  In this context, 
 
Vietnam's bilateral relationship with the United States enjoys 
 
pride of place; however, Vietnam is wary of pushing the agenda 
 
with the United States too far, too fast, lest it antagonize 
 
China. 
 
 
 
¶4.  (SBU) Mistrust of China runs deep, fed by historical 
 
animosities and simmering resentment over South China Sea 
 
territorial disputes.  Vietnam paid close attention to China's 
 
harassment of the USNS Impeccable in March, and this may have 
 
contributed to the MND's decision to participate in a 
 
subsequent fly-out to the aircraft carrier Stennis.  Senator 
 
Jim Webb's hearings over the summer on South China Sea issues 
 
were well received here.  The United States, as a matter of 
 
longstanding policy, takes no position on the competing legal 
 
claims in the South China Sea (or East Sea, as it is called in 
 
Vietnam).  We do, however, have a strong interest in 
 
maintaining freedom of navigation and the ability of our naval 
 
ships to conduct legitimate operations.  We have encouraged 
 
all parties to the dispute to work together to build 
 
confidence, in particular by enhancing the 2002 ASEAN 
 
Declaration on the Code of Conduct in the South China Sea.  In 
 
this regard, Vietnam and Malaysia's decision in May to submit 
 
a joint report on their extended continental shelf baseline 
 
claims is a positive development. 
 
 
 
Vietnam Intelligence Cooperation 
 
HANOI 00000018  003 OF 011 
 
 
-------------------------------- 
 
 
 
¶5. (SBU) Intelligence cooperation between the U.S. and 
 
Vietnam continues to advance one step at a time as the 
 
Vietnamese incrementally but steadily increase their 
 
interaction and integration into both the region and the 
 
world.  Vietnam has been willing to work with us and regularly 
 
share information regarding counterterrorism and 
 
counternarcotics.  There are signs, as our cooperation 
 
increases, that Vietnam is willing to move further in other 
 
areas such as counterproliferation.  You will receive 
 
briefings on other intelligence-related matters during your 
 
visit. 
 
 
 
Multilateral Engagement: Vietnam at the UNSC and ASEAN 
 
--------------------------------------------- --------- 
 
 
 
¶6.  (SBU) Vietnam has been professional and well-briefed but 
 
cautious at the UN Security Council, where it has completed 
 
its two-year term as a non-permanent member.  Hanoi has been 
 
eager to join consensus whenever possible, voting for example 
 
to support sanctions on Iran and North Korea.  Vietnam has 
 
shied away from taking a leadership role, however, and where 
 
there has been disagreement has tended to follow a strict non- 
 
interventionist line.  This led Vietnam to follow China and 
 
Russia's lead on Kosovo and Georgia, Somali piracy and the ICC 
 
Indictment of Sudanese President Bashir.  We expect Vietnam to 
 
do better as ASEAN Chair when it begins its term in 2010. 
 
Vietnam puts great store in ASEAN and has suggested repeatedly 
 
that it would like to facilitate better contact between ASEAN 
 
and its "plus one" dialogue partners, the United States in 
 
particular.  The decision to accede to ASEAN's Treaty of Amity 
 
and Cooperation was extremely well received in Vietnam, as was 
 
Secretary Clinton's visit to the ASEAN Secretariat in Jakarta 
 
and the strong support for deepened engagement that she 
 
articulated in Phuket.  Vietnam has lobbied hard to host a 
 
U.S.-ASEAN summit in Hanoi in 2010. 
 
 
 
¶7.  (SBU) Vietnam tends to look at a number of regional 
 
issues, including Burma, through an ASEAN lens.  Thus, while 
 
Vietnam has steadfastly followed China in rejecting a UNSC 
 
role in Burma, Hanoi recognizes the negative effect that 
 
Rangoon's continued intransigence has on ASEAN's credibility. 
 
HANOI 00000018  004 OF 011 
 
 
Vietnam has long urged the United States to take a more 
 
flexible approach to Burma and welcomed the Department's 
 
policy review; they also expressed strong support for Senator 
 
Webb's recent visit to Burma.  Our MFA contacts say they 
 
recognize the continued detention of ASSK makes it difficult 
 
for the United States to be more accommodating, a message they 
 
may not agree with, but insist they have communicated to the 
 
leadership in Rangoon. 
 
 
 
Human Rights and Religious Freedom 
 
---------------------------------- 
 
 
 
¶8.  (SBU) For Vietnam, non-interference is not just an 
 
abstract principle, but also a reflection of narrow self- 
 
interest.  As a single-party authoritarian state, Vietnam has 
 
had a consistently poor record on human rights, and still 
 
reacts defensively to criticism, though it has learned to be 
 
more responsive to international calls for dialogue, engaging 
 
the United States and others in annual formal human rights 
 
discussions, the most recent round of which took place in 
 
Washington November 8-9. 
 
For many in the Politburo and Central Committee, the "lessons" 
 
of 1989 and 1991, and more recently of the "color revolutions" 
 
in Ukraine, Georgia, and Kyrgyzstan, remain fresh.  This, 
 
coupled with lingering war-era animosities, colors the 
 
perceptions of some hard-line elements in the Ministries of 
 
Public Security and Defense, as well as the Party hierarchy. 
 
It will be extremely useful for you to reinforce the message 
 
that progress on human rights is not just a concern of 
 
Congress or the State Department, but is something that can 
 
affect progress in other areas of the relationship, including 
 
trade and military sales. 
 
 
 
¶9.  (SBU) This is particularly the case now, as Vietnam's 
 
Party-state apparatus moves to clamp down on political dissent 
 
in advance of the 11th Party Congress, scheduled for January 
 
¶2011.  The current "crackdown" began with the arrest and 
 
conviction of two prominent journalists in 2008 who had worked 
 
to expose a major corruption scandal.  Over the past year more 
 
than twenty dissidents have been arrested, including prominent 
 
corporate lawyer Le Cong Dinh, whose heavily edited taped 
 
police confession, aired on state television, was cast to 
 
HANOI 00000018  005 OF 011 
 
 
portray U.S. efforts to promote the rule of law and an 
 
independent judiciary as somehow sinister.  In the area of 
 
civil society, a recently promulgated Prime Ministerial decree 
 
("Decision 97") prohibits independent scientific/technical 
 
institutes from publicizing research critical of 
 
government/Party policies, and there is substantial evidence 
 
that the Vietnamese government is blocking access to Facebook. 
 
One positive area is in religious freedom.  Much remains to be 
 
done, but in general, Vietnam continues to take steps to 
 
permit its citizens to worship freely. 
 
 
 
Economic Successes and Challenges 
 
--------------------------------- 
 
 
 
¶10.  (SBU) Trade and investment with the United States form an 
 
important pillar of the overall relationship, and Vietnam 
 
welcomes signs that the U.S. economy is beginning to recover. 
 
The country's 6.2% GDP growth in 2008 -- though not bad in a 
 
regional context -- was the lowest since 2000, and according 
 
to just released data, dropped further in 2009 to 5.3%. 
 
Nevertheless, bilateral goods trade in 2008 was up 25% from 
 
the previous year, and stood at an all-time high of $15.7 
 
billion by the end of that year.  U.S. exports, particularly 
 
of agricultural products, are a particular success story and 
 
grew 47% in 2008.  Much of the increase of U.S. agricultural 
 
exports was due to higher prices and not a growth in volume, 
 
and should fall back into line with trend growth as the world 
 
commodity boom slows because of the global recession.  The 
 
most recent numbers show bilateral trade down by about 5.7% in 
 
¶2009. 
 
 
 
¶11.  (SBU) We are seeking to keep up the momentum with 
 
Bilateral Investment Treaty talks and have had three rounds so 
 
far, with the next proposed for early this year.  We have 
 
accepted the GVN's proposal for an Agricultural Working Group 
 
proposed by Minister of Agriculture and Rural Development Phat 
 
at the last round of Trade and Investment Framework Agreement 
 
talks in April 2009.  This working group will allow us to 
 
raise agriculture issues with a variety of ministries before 
 
they inhibit trade.  We are also pushing Vietnam to further 
 
open key markets such as beef, though our GVN contacts have 
 
told us that beef access is linked to the pending catfish 
 
regulation that could hurt Vietnam's catfish exports and rural 
 
HANOI 00000018  006 OF 011 
 
 
economies, especially in the southern part of the country.  We 
 
were encouraged by Vietnam's decision to join the Trans- 
 
Pacific Partnership, an 8-country regional free trade 
 
negotiation, as an associate member.  The first round of 
 
negotiations is scheduled for March. 
 
 
 
¶12. (SBU) Despite considerable USG support to assist the GVN 
 
in modernizing its food and food safety regimes, including 
 
support for the drafting of new food safety and biosafety 
 
laws, Vietnam's current draft Food Safety Law requires 
 
mandatory labeling of all food and agricultural products that 
 
contain at least five percent genetically modified content. 
 
The Food Safety Law is currently before the Science, 
 
Technology, and Environment Committee of the National 
 
Assembly.  It is expected the current draft law will be 
 
amended and sent to the full National Assembly for further 
 
review in March 2010 and a final vote in May 2010.  Ambassador 
 
and emboffs have repeatedly requested that the government 
 
remove all mandatory labeling provisions in the draft 
 
legislation. 
 
 
 
Health Diplomacy 
 
----------------- 
 
 
 
¶13.  (SBU) Health diplomacy has been a major spur to improved 
 
bilateral relations and has allowed us to engage with the GVN 
 
in areas of mutual interest, such as pandemic preparedness. 
 
Over the past several years, we have worked to boost Vietnam's 
 
development capacity to stem the spread of infectious 
 
diseases, respond to outbreaks, and address public health and 
 
safety concerns.  Currently about 80 percent of all U.S. 
 
development aid is in the health sector.  While we provide 
 
cooperative assistance in a range of areas, HIV/AIDS 
 
assistance under the President's Emergency Plan for AIDS 
 
Relief (PEPFAR) has totaled $322 million since 2004, including 
 
$88.6 million in FY09.  The United States has also made a 
 
substantial investment to prevent and control highly 
 
pathogenic avian influenza, with total funding since 2004 of 
 
about $50 million through FY 2009.  In April 2010, USAID will 
 
assist the GVN to host the seventh International Ministerial 
 
Conference on Animal and Pandemic Influenza, and as a follow 
 
up to July's Lower Mekong Ministerial, the United States has 
 
HANOI 00000018  007 OF 011 
 
 
also announced plans to host in Vietnam a regional meeting on 
 
infectious disease.  In mid-October, the Ministry of Health 
 
stopped counting confirmed cases of 2009 H1N1 influenza in 
 
Vietnam, which surpassed 10,000, and to date has reported 
 
about 49 fatalities.  As with highly pathogenic H5N1, the 
 
Centers for Disease Control and Prevention, USDA, and USAID 
 
have cooperated actively with their Vietnamese counterparts to 
 
track H1N1 influenza and to provide guidance on containment 
 
and treatment. 
 
 
 
¶14.  (SBU) Agent Orange (and its contaminant, dioxin) remains 
 
a sensitive issue in U.S.-Vietnamese relations.  Despite 
 
dissatisfaction with the pace of U.S. engagement, highlighted 
 
in both the international and local media, we continue to work 
 
with the GVN to find mutually acceptable solutions to 
 
environmental contamination and potential health impacts from 
 
dioxin.  The two governments agree that dioxin contamination 
 
is concentrated in approximately 20 "hotspots," mostly areas 
 
within former U.S. airbases where Agent Orange was stored, 
 
loaded, and transferred.   Areas subjected to heavy aerial 
 
spraying do not have soil concentrations considered hazardous. 
 
The GVN has requested that the United States focus its efforts 
 
at the "hotspot" at the former U.S. airbase in Danang. 
 
 
 
¶15.  (SBU) Our engagement on this issue has accomplished much, 
 
both to transform the tone of the bilateral dialogue and to 
 
build Vietnam's capacity to address environmental issues and 
 
provide assistance for the disabled.  From 2001 to 2007, the 
 
USG spent over USD 2 million to initiate technical dialogues, 
 
scientific conferences on the effects of AO/dioxin, and fund a 
 
4-year project to build the capacity of Vietnamese scientists 
 
to analyze soil samples collected from the Danang airport.  In 
 
2007, the State Department and EPA provided $400,000 to 
 
support temporary dioxin containment measures at Danang.  The 
 
Joint Advisory Committee (JAC) for Agent Orange/dioxin brings 
 
together scientists and researchers from both governments 
 
(U.S. members represent State, USAID, EPA, HHS, and DOD) to 
 
provide scientifically based advice to policy makers for 
 
potential environmental and health cooperation.  The JAC held 
 
its fourth annual meeting in September 2009.  It has helped 
 
guide pilot remediation efforts and recently issued terms of 
 
reference for its Health Working Group to begin disability 
 
survey exercises and other activities to assess the impact, if 
 
HANOI 00000018  008 OF 011 
 
 
any, of dioxin contamination. 
 
 
 
¶16.  (SBU) With strong financial support from Congress, we 
 
work with the GVN, UNDP, Ford Foundation, and other donors to 
 
form a multilateral coalition to support environmental 
 
remediation.   USAID continues to implement USD 6 million in 
 
Congressional appropriations from 2007 and 2009 for dioxin 
 
mitigation and health activities.  USAID has provided grants 
 
totaling USD 2 million (and will provide an additional USD 1 
 
million) to East Meets West, VNAH, and Save the Children for 
 
efforts focusing on health and social services delivery, 
 
rehabilitation services, and employment and entrepreneurial 
 
assistance.  In September 2009, USAID awarded a USD 1.69 
 
million contract to begin preparation for environmental 
 
remediation at the Danang airport.  Also at Danang, EPA and 
 
the Vietnam Academy of Science and Technology recently 
 
commenced a pilot test to determine the suitability of 
 
bioremediation to destroy dioxin in Vietnam.  With remaining 
 
2009 funds and the recently announced additional USD 3 million 
 
in FY2010, USAID will fund full containment at Danang in 
 
preparation for dioxin destruction. 
 
 
 
Unexploded Ordinance 
 
-------------------- 
 
 
 
¶17.  (SBU) Efforts to deal with the consequences of unexploded 
 
ordinance (UXO) and landmines continue to be warmly received. 
 
The United States has invested over USD $43 million so far in 
 
a broad spectrum of programs to locate, remove, and destroy 
 
unexploded ordinance and landmines, and to improve the health 
 
and livelihood of Vietnamese living in affected areas, 
 
particularly in Quang Tri and Quang Binh provinces, which 
 
adjoin the former DMZ.  Approximately $3.5 million has been 
 
made available for FY 10 to support UXO activities in Vietnam. 
 
While the US is committed to UXO/landmine issues, we cannot 
 
guarantee that funding will always be available.  It is 
 
therefore necessary, given the complexity of the problem, to 
 
support a systemic national approach to make Vietnam's own 
 
mine action efforts more effective.  With this in mind, the 
 
United States has supplemented its assistance with efforts to 
 
build the capacity of the newly formed Vietnam Bomb and Mine 
 
Action Center (VBMAC) and to assist the VBMAC to draft and 
 
HANOI 00000018  009 OF 011 
 
 
implement a National Strategy to address the explosive 
 
remnants of war. 
 
 
 
U.S. Assistance: Trade, Education, Environment, Governance 
 
--------------------------------------------- ------------- 
 
 
 
¶18.  (SBU) U.S. assistance levels in non-PEPFAR areas remain 
 
disproportionally low, particularly when compared with aid 
 
provided to neighboring developing nations.  Even so, programs 
 
such as USAID's STAR and the Vietnam Competitiveness 
 
Initiative have become the government's preferred source of 
 
expertise in reshaping trade and economic regulation, with 
 
positive effects on governance.  Treasury is also starting to 
 
engage on economic issues, with programs in areas such as 
 
small- and medium-sized enterprise financing, taxation, and 
 
bond market development.  Given its status as one of the 
 
countries most vulnerable to rising sea levels, the GVN is 
 
particularly eager to partner with the United States to 
 
develop responses to climate change. Building on existing, 
 
limited bilateral initiatives, USAID expects to begin 
 
supporting climate change programs in 2010 and plans to expand 
 
into environmental governance, water and coastal resource 
 
management and biodiversity protection in future years.  The 
 
Joint Educational Task Force, formed in the wake of Prime 
 
Minister Dung's 2008 visit, prepared recommendations on 
 
improving Vietnam's education system, including establishing 
 
an American university in Vietnam.  In the meantime, programs 
 
such as the Fulbright Program and the Vietnam Education 
 
Foundation, with combined annual funding of almost $10 
 
million, continue to bring scores of Vietnamese students to 
 
the U.S. every year.  The number of Vietnamese students 
 
studying in U.S. colleges and universities now ranks eighth in 
 
the world.  This and USG programs to improve Vietnam's own 
 
education system will be key to both political and economic 
 
development in Vietnam over the long term. 
 
 
 
¶19.  (SBU) Your official hosts, Vietnam's National Assembly, 
 
has in recent years moved to assert its independence, and now 
 
plays an increasing role in oversight, the drafting of 
 
legislation, and constituent services.  The Mission is 
 
actively seeking opportunities to work with the National 
 
Assembly to promote good governance, including efforts to 
 
boost the professionalism of its staff and improve its 
 
HANOI 00000018  010 OF 011 
 
 
capacity to conduct independent research.  Your National 
 
Assembly hosts will likely pursue with you avenues for 
 
building inter-legislative contact and exchanges. 
 
 
 
Adoptions 
 
--------- 
 
 
 
¶20.  (SBU) The United States and Vietnam suspended their 
 
adoption agreement in September 2008, after the Embassy and 
 
HCMC Consulate uncovered repeated instances of baby selling 
 
and manipulation of birth mothers, including at the Tu Do 
 
hospital in HCMC.  This ended a flow of Vietnamese children to 
 
American adoptive parents that peaked at over 700 per annum in 
 
¶2007.  Since April 2009, Vietnam has made important strides to 
 
reform its adoption regime, with significant assistance from 
 
UNICEF.  The National Assembly is currently considering a 
 
draft adoption law, which could take effect as early as 
 
January 2011.  Once Vietnam has its new adoption law in place, 
 
we believe it will attempt to accede to the Hague Convention 
 
on Intercountry Adoption, enabling Americans to once again 
 
adopt Vietnamese orphans. 
 
 
 
Administrative Obstructions: Staffing and a New Embassy 
 
--------------------------------------------- ---------- 
 
 
 
¶21.  (SBU) Vietnam closely adheres to its rights under Article 
 
11 of the Vienna Convention on Diplomatic Relations to limit 
 
the size of the sending state's diplomatic mission.  GVN 
 
practice has been to accept requests for new positions once, 
 
annually.  However, the approval process has been 
 
excruciatingly slow.  At present, 10 positions (five in Hanoi, 
 
and five in HCMC) are awaiting approval.  The five in HCMC 
 
have been outstanding for 22 months.   This inability to 
 
increase staffing size to keep pace with the growing workload 
 
in what is otherwise a robust bilateral relationship has long 
 
since reached the point where it is adversely affecting our 
 
ability to perform our mission.  FM/DPM Khiem told Secretary 
 
Clinton during his visit to the U.S. in October the approvals 
 
would no longer be an issue, but to-date, we have seen no 
 
change.  The U.S. Mission has advocated for abolishing caps on 
 
staffing. 
 
HANOI 00000018  011 OF 011 
 
 
¶22.  (SBU) Currently, U.S. Embassy Hanoi is housed in three 
 
office buildings around town.  The primary building, the 
 
Chancery, is a nine-story, rat-infested building with 
 
inadequate space and substandard building systems.  When 
 
acquired in 1995, it was intended to serve as a temporary 
 
facility.  Although the search and negotiations for a site to 
 
build a new Chancery took longer than the five years 
 
originally envisioned, the USG and GVN were near agreement on 
 
a selected site when negotiations were suspended in January 
 
2009 over the length of the land lease.  The GVN asserted it 
 
legally could only offer 99 years.  The USG insisted that 
 
absent fee simple title to the land (not permitted in 
 
Vietnam), it required 99 years plus 99 years.  As a result of 
 
the impasse, the construction project has been tentatively 
 
rescheduled for 2020, although the Embassy believes it will 
 
take 20-30 years before the GVN is able to change its laws 
 
related to land ownership or leasing, thereby opening the way 
 
to a building.  In the meantime, the State Department's Office 
 
of Overseas Building Operations (OBO) is developing a scope of 
 
work for a major rehab of the existing Chancery, to begin in 
 
¶2013.  It is unknown how much funding will be available for 
 
such a project or how practical it would be, given that no 
 
amount of money can ever make the existing building what it is 
 
not -- a Chancery that provides an adequate and appropriate 
 
work environment for its staff and serves as a visual 
 
statement of the USG's commitment to building a healthy, 
 
vibrant bilateral relationship with Vietnam. 
Michalak