Race to Hanoi

February 16, 1993

France may not be winning the race for the business and labor of Vietnam, but the U.S. is losing it. French President Francois Mitterrand's visit to Hanoi, the first by a Western leader since unification of the country in 1975, gives French businessmen he brought along a big advantage.

France has recognized Vietnam since 1989. Mr. Mitterrand lectured his Communist hosts on civil liberties and democracy, but promised to work to end the U.S. embargo, which translates as a boycott by the World Bank and International Monetary Fund. A delegation of American businessmen was on hand watching Mr. Mitterrand's coup. The last policy of the Bush administration allows U.S. firms to set up offices in Vietnam and make deals, which may not go into effect till the U.S. embargo is lifted.

The Clinton administration ought to implement the Bush policy. That policy consists of a 1991 "road map" toward normalization, by which Hanoi was informed of what it need do to qualify. Hanoi, arguably, has already qualified.

The Carter administration nearly recognized Vietnam in the late 1970s, then pulled back for fear of offending the bigger prize, China. The barriers to U.S. recognition are alleged withholding of information on U.S. prisoners of war and the need for good faith in reaching a settlement in Cambodia. The facts are that U.S. officials believe Hanoi has been fully cooperative on MIA information, and that Vietnam and the U.S. are more partners than adversaries in the politics of Cambodia. Any remaining information on MIAs will come faster when an American embassy is in place.

Vietnam is the last untapped major Asian market and labor pool. The Communist regime is hungry for capitalist investment. What Vietnam has to offer is oil offshore for firms wishing to diversify away from the Persian Gulf, and a large, skilled and desperately hungry labor force. It is not without risk as a place to invest, from crumbling infrastructure to corrupt officials. But that is for businesses to assess.

Hong Kong, Taiwan and France lead the parade of investment into Vietnam. Japan restored economic ties last November and is rushing in with Britain and Australia. Only the United States sticks to the old boycott. Vietnam is not isolated; the United States is. The loss is American.

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