US agrees deal for Vietnam to join WTO

WASHINGTON (Reuters) – Vietnam has reached agreement on a
trade deal with the United States that paves the way for the
communist-run country to join the World Trade Organization this
year, U.S. and Vietnamese officials said on Sunday.

The agreement lowers tariffs on U.S. industrial and farm
products and removes non-tariff barriers that block U.S.
service providers from working in Vietnam, Stephen Norton, a
spokesman for the U.S. Trade Representative, said in a
statement.

In Hanoi, the state-run Tuoi Tre (Youth) newspaper quoted
an official at the Vietnamese embassy in Washington as saying
the two countries, former war enemies in the 1960s and 70s,
were expected to sign the agreement in early June.

Once a deal is completed, the U.S. Congress must vote on
giving the Southeast Asian country of 83 million people
Permanent Normal Trade Relations Status. Then Vietnam would
submit its final request for WTO membership later in 2006.

Outgoing U.S. Trade Representative Rob Portman, who has
been nominated to be the next White House budget director, said
it was a “good agreement” for U.S. business.

“It opens a new and growing market for American
agricultural goods, services, such as financial services, and
manufactured products,” said Portman, whose designated
successor Susan Schwab was scheduled to visit Vietnam on June 1
and 2 for a conference of Asia Pacific Economic Cooperation
(APEC) trade ministers.

“Vietnam recognises that broad-based reform and economic
liberalisation are essential to its integration into the global
economy,” Portman said. “We intend to work hard with Vietnam to
complete the process of its full accession to the WTO.”

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The VietnamNet online newspaper quoted sources close to the
Vietnamese trade negotiators as saying the two sides reached
agreement after “finding a common voice” on outstanding issues.

Tuoi Tre said the deal included Vietnam scrapping a $4
billion subsidy plan for garments and textiles as soon as it
joins the world’s biggest trading club.

Some members of the U.S. Congress were expected to put
religious and human rights constraints on any trade bill. But
on a visit to Hanoi last month, U.S. House of Representatives
Speaker Dennis Hastert, an Illinois Republican, urged Congress
to pass a deal, saying the “greater good” outweighed human
rights concerns.

Vietnam has completed deals needed to enter the
Geneva-based WTO with all of its other leading trade partners.

The United States and Vietnam restored diplomatic relations
in 1995, 20 years after the end of the Vietnam War. Since the
countries signed a previous business deal in 2001 known as the
Bilateral Trade Agreement, Vietnamese exports to the United
States have grown to more than $6.5 billion in 2005.

Hanoi wants to be a WTO member by the time it hosts
President Bush in November for the annual summit of the
21-member APEC forum.

(Additional reporting by Nguyen Nhat Lam and Grant McCool
in Vietnam)