Relations with America Improve as the Vietnamese Economy Reforms
The U.S. lifted a Vietnamese trade embargo in Feb. 1994 that had been in place since U.S. involvement in the war. Full diplomatic relations were announced between the two countries in July 1995. In April 1997, a pact was signed with the U.S. concerning repayment of the $146 million wartime debt incurred by the South Vietnamese government, and the following year the nation began a drive to eliminate inefficient bureaucrats and streamline the approval process for direct foreign investment. Efforts of reform-minded officials toward political and economic change have been thwarted by Vietnam’s ruling Communist Party. In April 2001, however, the progressive Nong Duc Manh was appointed general secretary of the ruling Communist Party, succeeding Le Kha Phieu. Even with a reformer at the helm of the party, change has been slow and cautious.
In Nov. 2001, Vietnam’s national assembly approved a trade agreement that opened U.S. markets to Vietnam’s goods and services. Tariffs on Vietnam’s products dropped to about 4% from rates as high as 40%. Vietnam in return opened its state markets to foreign competition.
The government highlighted its efforts to crack down on corruption and crime with the June 2003 conviction of notorious criminal syndicate boss Truong Van Cam, known as Nam Cam. He was sentenced to death, along with 155 other defendants, and executed in June 2004.
Prime Minister Phan Van Khai visited the United States in June 2005, becoming the first Vietnamese leader to do so since the Vietnam War ended. He met with President Bush and several business leaders, including Microsoft chairman Bill Gates. The U.S. is Vietnam’s largest trading partner, buying about $7 billion in Vietnamese goods each year.