The Vietnam-U.S. Normalization Process

Publication Date: August 2005

Publisher: Library of Congress. Congressional Research Service

Author(s):

Research Area: Government

Type:

Coverage: Vietnam

Abstract:

U.S.-Vietnam diplomatic and economic relations remained essentially frozen for more than a decade after the 1975 communist victory in South Vietnam. Relations took major steps forward in the mid-1990s, particularly in 1995, when the two sides opened embassies in each other's capitals. Since then, the normalization process has accelerated and bilateral ties have expanded. Congress has played a significant role in the normalization process.

The most important step toward normalization since 1995 was the signing of a sweeping bilateral trade agreement (BTA), which was approved by Congress and signed by President Bush in 2001. Under the BTA, the U.S. extended conditional normal trade relations (NTR) to Vietnam. In return, Hanoi agreed to a range of trade liberalization measures and market-oriented reforms. Trade -- primarily imports from Vietnam -- has surged since the BTA was signed. The United States is now Vietnam's largest trading partner.

Until recently, each step in improving bilateral ties has brought controversy, albeit at diminishing levels. U.S. opponents in Congress and elsewhere have argued that Vietnam maintains a poor record on human, religious, and labor rights. Opposition has also come from groups arguing that Vietnam has not done enough to account for U.S. Prisoners of War/Missing in Action (POW/MIAs) from the Vietnam War, though this argument has diminished markedly in recent years.

Forces favoring normalization have included those in Congress and elsewhere reflecting a strong U.S. business interest in Vietnam's reforming economy and American strategic interests in working with U.S. friends and allies to promote stability and development by integrating Vietnam more fully into the existing East Asian order. The next, and final, step toward full normalization would be granting permanent normal trade relations status to Vietnam. This step, which would require congressional approval, almost certainly will be considered in the context of negotiating Vietnam's accession to the World Trade Organization (WTO). Vietnam hopes to join the WTO in 2005, though some analysts believe this is an overly optimistic time frame.

Recently, clashes over Vietnam's human rights record and trade friction over shrimp, catfish, and textiles have soured relations somewhat since the heady days after the BTA was signed. At the same time, some U.S. analysts have suggested that the Bush Administration seek to expand the as yet embryonic security relations between Hanoi and Washington, arguing that Vietnam and the United States share suspicions of China's expanding influence in Southeast Asia. Other observers, however, have argued there is little evidence that Hanoi seeks to balance Beijing's rising power. Regardless of motivation, since 2003 the two sides slowly have expanded militaryto-military ties, albeit primarily in symbolic rather than substantive ways.

Vietnam and the United States gradually have been expanding their political and security ties, symbolized by the Vietnamese Prime Minister's visit to the United States in June 2005, the first such trip by a Vietnamese head of state. President Bush spoke of his desire to move bilateral relations to "a higher plane," backed Vietnam's bid to enter the WTO, and the two countries signed an international military education training (IMET) agreement. The two countries have a strategic interest in offsetting China's increased economic, political, and cultural influence in Southeast Asia.