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December 8, 2003

Not My Father's Vietnam

By

My father wasn't too crazy about it when his daughter the trade analyst decided to vacation in Vietnam. Given the circumstances of his "visit" there, it's hard to blame him. His sergeant tracked him down two days into my parents' honeymoon and told him to enjoy the next two weeks, because after that he was shipping out.

But after spending a few days in the land he would rather forget, I have to say I found the people, culture and economy of Vietnam intriguing and the potential for the place astounding.

Some things haven't changed. It was, as he might have figured, quite steamy on the August day when I landed in Ho Chi Minh City, which he knew as Saigon - the capital of what was then South Vietnam. Some of the older buildings still stand as silent monuments to that troubled time.

I worried whether the people still resented Americans, given the bitter nature of the war. I soon learned I shouldn't have. Vietnam has changed dramatically. It has opened its economy. It seeks to grow. It pursues tourist dollars. It is more curious about America than bitter toward Americans.

I did tour the war museum in Ho Chi Minh City and the Cu Chi tunnels, accompanied by our guide - a card-carrying member of the Communist Party. But even she was more interested in learning about my culture than inculcating me with hers.

And in Hanoi, which my father knew as the capital of North Vietnam, another guide pointed to the lake where Sen. John McCain's plane went down and gushed happily about how he had met Mr. McCain and how the lake is named after the senator from Arizona who spent six years in the "Hanoi Hilton."

They know how to treat tourists here. Tourism equals money, and they need money. They also firmly grasp the value of open markets. They are skilled in capitalism and sales. I know - I left there with a suitcase stuffed with new clothes and pottery.

The Vietnamese have sought to liberalize trade for several years now. They export not just garments, but crude oil, rice, coffee, rubber and other products. They have negotiated a bilateral trade agreement [BTA] with the United States that has bolstered trade with America from $100 million per month to $650 million.

But when it comes to truly opening trade, the Vietnamese have a long way to go to match their largest trading partner, Singapore, which stands as one of the world's top examples of the benefits of open markets. Only then will they see their per capita income - now $390 per year - approach levels enjoyed in modern economies.

The Vietnamese need to lower tariffs and bring order and integrity to their customs process, which the U.S. State Department describes as "nontransparent and highly discretionary." They need to remove the still-substantial barriers to capital flow and foreign investment, and they need to sell off the economy-strangling government-owned stakes in such sectors as finance, telecommunications, energy and manufacturing.

They need to improve their human-rights record, which still includes arrests of clergy, and other practices that make it hard for other countries - including the United States - to further help them bolster trade. Without such improvements, many members of Congress likely would object to a full-blown free-trade agreement [FTA]. The Vietnamese need to crack down on crimes such as software piracy. Today, 95 percent of the computer software in Vietnam is pirated, according to the Business Software Alliance. That's the highest rate in the world.

In other words, as in many struggling countries, the problems may be many but the causes are few. In Vietnam, an important initiative should be to strengthening "rule of law." That means protecting property, having government deal with all comers on an equal and honest basis and having contracts and other business documents mean what they say and hold up in courts of law.

Still, the place has changed dramatically from when my father was there. They want to be like us. They no longer call evil what we have and do and stand for. Now, they want it. That isn't everything, and it's probably not enough even to get my father to view the place more favorably.

But it's a start.

Sara Fitzgerald is a trade analyst in the Center for International Trade and Economics at the Heritage Foundation.

First apeared in The Washington Times

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