Senator Max Baucus Delivers Speech on U.S.-Vietnam Trade and Economic Relations
(WASHINGTON, D.C.) Today, Senator Max Baucus, Ranking Member of the Senate FinanceCommittee, delivered the keynote speech on U.S.-Vietnam Trade and Economic Relations at aforum on bilateral trade between the two countries ten years after they normalized diplomaticrelations. This forum was held as part of Vietnamese Prime Minister Phan Van Khai’s historicvisit to the United States. Senator Baucus’s remarks follow:
Remarks of Senator Max Baucus on U.S.-Vietnam Trade and Economic Relations
I am honored to be here for the first ever visit of a Vietnamese Prime Minister to the UnitedStates, and to celebrate 10 years of normal relations between our two countries. It’s notsomething I envisioned I would be doing 30 years ago, when the last U.S. soldier left Vietnam.Thank you, Deputy Prime Minister Vu Khoan, for your kind words. And thank you Ginny Footeat the U.S.-Vietnam Trade Council, for all of your hard work to make this possible.
VISIONS OF VIETNAM
We all have a stereotypical vision of Vietnam in our minds. Sadly, this is largely a vision ofjungles and battle fatigues and mud – all shaped by the movies of the Vietnam War that wewatched in the 70s and 80s. A vision stuck in the past.
Of women in conical hats and blackened teeth struggling to make do in an emerald green ricepaddy. Or of bicycle riders pedaling in darkness through the winter gloom of nighttime Hanoi.
I recently saw a fantastic picture book of Vietnam, which certainly dispelled these stereotypes.The picture book – called “Bikes of Burden” – should be required reading for anyone interestedin Vietnam today.
The book has 150 pages of pictures of people on motorbikes. In one photo, a motorbike driver –sporting a baseball cap, sunglasses, and jeans – carries hundreds of ducks to market on the backof his bike. In another, a driver precariously balances his delivery of seven bed mattress on hisHonda Dream motorbike. In another, laughing Vietnamese schoolgirls clad in beautiful white aodais whisk through Ho Chi Minh City in the late afternoon sun.
This surely is not the vision of Vietnam Yesterday. Instead, this book captures the vision ofVietnam Today. A vision of commerce everywhere you look. A vision of 80 million vendorsand consumers buying and selling something on every corner of every street of every city. Avision of motorbikes and cars whizzing by smart new office towers and industrial parks.A vision of hip and fashionable twenty-somethings zipping on their motorbikes around the centerlake of Hanoi or up and down the streets of District 1 in Ho Chi Minh City.
It is a vision of a country on the go. It is a vision of progress. It is vision of the future.
And that future is all the brighter in light of our joint efforts to normalize diplomatic andeconomic relations between our two nations. As we all know, the normalization process wasfraught with difficulties. But both of our nations rose to the challenge. We cleared each hurdlein front of us. We built a solid foundation for future cooperation and mutual respect.
Look at what we have accomplished together:
• We lifted our trade embargo on Vietnam in 1994.
• We established diplomatic relations in 1995.
• We exchanged our first Ambassadors in 1997.
• We signed our successful Trade Agreement in July 2000.
We watched President Clinton make his historic visit to Vietnam in December 2000 to enjoy thewarm and enthusiastic greeting by the Vietnamese people. That was the first U.S. Presidentialvisit since July of 1969, when Richard Nixon spent six hours in South Vietnam during the heightof the war.
I and others fought for Congress to grant Vietnam conditional normal trade relations status in2001.
We saw in 2003 the first post-war visit of a U.S. warship – the USS Vandergrift – which madeits way up the Saigon River. And we saw the first U.S. navy sailors walk the streets of Ho ChiMinh City since the fall of Saigon in 1975.
And today, we are witness to another piece of history, as we join in honoring Prime MinsterPhan Van Khai on the occasion of his historic visit.
Given these accomplishments, it is hard to imagine that our two countries struggled for so manyyears in such a fierce and protracted war. From sworn enemies, we have become – in such ashort time – the poster children for reconciliation. It is a model for others to follow.
THE NEXT STEPS IN NORMALIZATION: WTO ACCESSION AND PNTR
We’ve done a lot. But we are not finished. We have two final stops on the road tonormalization. And these are two stops that I care about very much – Vietnam’s accession to theWTO, and Congress’s grant of Permanent Normal Trade Relations, or “PNTR,” to Vietnam.
Vietnam belongs in the WTO. The WTO should welcome Vietnam in as quickly as possible –hopefully by the WTO’s December Ministerial in Hong Kong. A country of over 80 millionpeople, with economic growth rates of 7 percent or more, belongs in the world trading system.
But joining the WTO is no easy ride. As you know, it is a difficult process. It involves painfuleconomic restructuring and difficult trade concessions.But it is worth the cost. Countries inside the WTO system are much better off than those on theoutside. They benefit from the rules and protections shared by 148 other economies.
Unfortunately, these are benefits that Vietnam does not yet enjoy.
I encourage the Vietnamese government – from the Prime Minister on down – to do everythingyou need to, and as quickly as possible, to conclude your bilateral and multilateral discussions.That will send an important signal to WTO members that you are ready to play ball to join theWTO.
VIETNAM IN THE CONTEXT OF U.S. TRADE POLICY
America also has reasons for wanting Vietnam to join the WTO. Vietnam’s accession to theWTO – and the process that Congress will undertake to grant permanent normal trading status toVietnam – will be good for the United States and good for the future U.S. trade policy.This is a difficult period in U.S. trade policy. As you know, the congressional debate on CAFTA– a free trade agreement between the United States and 6 other countries – has exposed deepfissures in Congress.
Republican and Democratic members alike have deep concerns about the direction of U.S. tradepolicy. Many fear that our trade agreements are no longer working for Americans. Manybelieve that we spend too little time enforcing those agreements that we have on the books.
It has not helped that, over the past few years, our trade agreements have become less relevant toU.S. commercial interests. We have been choosing free trade agreement partners based onforeign policy and using the scarce resources at USTR to negotiate agreements without muchcommercial relevance to our economy.
As a result, it becomes harder to muster the enthusiasm necessary to get a trade agreementthrough Congress.
Trade with Vietnam is different. The opportunities for U.S. exporters are staggering. Vietnamhas 80 million consumers. Most Vietnamese are younger than 25 years old. These potentialconsumers should and will entice American business.
Just look at the statistics.
• Vietnam has a literacy rate of over 90 percent.
• Per capita income there has nearly doubled since the 1990s.
• The share of families in poverty has fallen from 70 percent a decade ago to 30 percenttoday.
• Ho Chi Minh City alone has 37,000 private small businesses.
• And Vietnam’s economy is growing 7 percent per year.
It is staggering to think about how much Vietnam has accomplished in such a short amount oftime. Fifteen years ago, the statistics I just cited were not this good. The dynamism so obvioustoday in Hanoi and Ho Chi Minh City had not yet appeared.
In those days, Vietnam struggled to feed its own people. Now, Vietnam has become the world’ssecond-largest exporter of rice.
With the U.S.-Vietnam Bilateral Trade Agreement, we are bearing witness to Vietnam’ssuccessful economic transformation. U.S.-Vietnam trade – at over $6.2 billion in 2004 – is fourtimes the level it was when the trade agreement came into force in 2001.
Although much of this trade growth has been from rising imports of Vietnamese goods, I expectthat Vietnam’s accession to the WTO will help lay the foundations for continued growth in U.S.exports to Vietnam. And not just in sectors like aircraft and machinery which are already doingwell in Vietnam, but also in areas like insurance, banking, and telecommunications, where U.S.service providers typically thrive in overseas markets.
U.S.-Vietnam trade is a good thing. We can get excited about it. It has the potential to attract agood deal of congressional support. And it reminds us why a robust trade policy makes sense forthe United States.
I look forward to Vietnam’s accession to the WTO and to helping shepherd PNTR for Vietnamthrough the Senate. I hope that these can be among the first bricks in the foundation of a revivedbipartisan U.S. trade policy.
LOOKING TOWARD PNTR
But, you must help me out here, Mr. Deputy Prime Minister. You will have to help me explainto my increasingly skeptical colleagues why PNTR for Vietnam and your accession to the WTOare good for the United States and good for Americans.
So I need your help on two things.
The first way to help me is to vigorously implement your commitments in our bilateral tradeagreement. I know that you have done a remarkable job of implementing the agreement over thepast few years and have benefited greatly from the technical assistance programs that the U.S.-Vietnam Trade Council, USAID, and others have provided. But there are lingering concerns,particularly in intellectual property rights.
Congress cares deeply about enforcement – in intellectual property rights as well as in otherareas like trading rights and services. And in this political climate – particularly as the voteapproaches on PNTR with Vietnam, it will be very important to demonstrate the extent to whichVietnam is addressing the implementation concerns of the U.S. Government.
The second way that you can help me is to finish your negotiations with the United States – boththe bilateral market access deal and the more general “WTO rules” negotiations – which we viewas a package. Now is the time to put all of your cards on the table and conclude a deal that wecan all be happy with. A deal that our respective legislatures can showcase as a great success.
U.S. demands on market access and WTO rules are not extraordinary. They are in line with whatthe United States expects of other WTO applicants. It will be very hard to sell to Congress a dealthat looks less robust than those the United States has concluded with other WTO members.
Those are the two keys ways that you can help me to help you secure support for your accession,and for granting Vietnam PNTR.
I know that these are not easy tasks. But we have come so far together already. We need go justa bit further to complete the normalization process. We need to rise to the challenge together,and reap the benefits.
And so, I once again honor our distinguished visiting delegation. I join in wishing you aproductive and enjoyable visit. And, in the words of a great American film about thereconciliation of two other erstwhile adversaries, may this be “the beginning of a beautifulfriendship.”
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