U.S.-Vietnam Relations in 2013: Current Issues
and Implications for U.S. Policy
Mark E. Manyin
Specialist in Asian Affairs
June 19, 2013
Congressional Research Service
7-5700
www.crs.gov
R40208
CRS Report for Congress
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U.S.-Vietnam Relations in 2013: Current Issues and Implications for U.S. Policy

Summary
After communist North Vietnam’s victory over U.S.-backed South Vietnam in 1975, the United
States and Vietnam had minimal relations until the mid-1990s. Since the establishment of
diplomatic relations in 1995, overlapping security and economic interests have led the two sides
to expand relations across a wide range of issue-areas and begin to form a strategic partnership of
sorts. Perhaps most prominently, in 2010, the two countries mobilized a multinational response to
China’s perceived attempts to boost its claims to disputed waters and islands in the South China
Sea. This coordinated effort to promote the freedom of navigation has continued.
U.S. Interests
In the United States, voices favoring improved relations have included those reflecting U.S.
business interests in Vietnam’s growing economy and U.S. strategic interests in expanding
cooperation with a populous country—Vietnam has over 90 million people—that has an
ambivalent relationship with China and that is asserting itself on the regional stage. Others argue
that improvements in bilateral relations should be conditioned upon Vietnam’s authoritarian
government improving its record on human rights. The population of more than 1 million
Vietnamese-Americans, as well as legacies of the Vietnam War, also drive continued U.S. interest.
Vietnamese Interests
Vietnamese leaders have sought to upgrade relations with the United States in part due to the
desire for continued access to the U.S. market and to worries about China’s expanding influence
in Southeast Asia. That said, Sino-Vietnam relations are Vietnam’s most important bilateral
relationship and Vietnamese leaders must tiptoe carefully along the tightrope between
Washington and Beijing, such that improved relations with one capital not be perceived as a
threat to the other. Also, some Vietnamese remain suspicious that the United States’ long-term
goal is to erode the Vietnamese Communist Party’s (VCP’s) monopoly on power. Thus far, an
apparent intensification of political infighting among Vietnam’s top leaders in 2012 and 2013
does not appear to have affected the fundamental dynamics of Vietnam-U.S. relations.
Economic Ties
The United States is Vietnam’s largest export market and in some years its largest source of
foreign direct investment. Bilateral trade in 2011 was over $17 billion, a tenfold increase since the
United States extended “normal trade relations” (NTR) treatment to Vietnam in 2001. Increased
trade also has been fostered by Vietnam’s market-oriented reforms. From 1987-2007, Vietnam’s
annual gross domestic product (GDP) growth averaged over 7%. Since then, Vietnam’s economy
has been buffeted by economic difficulties that have lowered growth rates and raised inflation.
The United States and Vietnam are 2 of 11 countries negotiating a Trans-Pacific Strategic and
Economic Partnership (TPP) regional free trade agreement (FTA). To go into effect, a TPP
agreement (if one is reached) would require approval by both houses of Congress. Vietnam is one
of the largest recipients of U.S. assistance in East Asia; since the late 2000s, annual U.S. aid
typically surpasses $100 million, much of it for health-related activities.
Human Rights
Human rights are the biggest thorn in the side of the relationship. Although disagreements over
Vietnam’s human rights record have not prevented the two sides from improving relations, they
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U.S.-Vietnam Relations in 2013: Current Issues and Implications for U.S. Policy

do appear to create a ceiling for the speed and extent of these improvements. Vietnam is a one-
party, authoritarian state ruled by the Vietnamese Communist Party (VCP), which appears to be
following a strategy of permitting most forms of personal and religious expression while
selectively repressing individuals and organizations that it deems a threat to the party’s monopoly
on power. Most human rights observers contend that the government, which already had
tightened restrictions on dissent and criticism since 2007, further intensified its suppression in the
first half of 2013.
Some human rights advocates have argued that the United States should use Vietnam’s
participation in the TPP FTA talks as leverage to pressure Hanoi to improve the country’s human
rights situation. Also, since the 107th Congress, various legislative attempts have been made to
link the provision of U.S. aid, as well as arms sales, to Vietnam’s human rights record.

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U.S.-Vietnam Relations in 2013: Current Issues and Implications for U.S. Policy

Contents
Introduction ...................................................................................................................................... 1
U.S. Interests and Goals in the Bilateral Relationship............................................................... 1
Vietnam’s Interests and Goals in the Bilateral Relationship ..................................................... 1
A Ceiling on the Relationship? .................................................................................................. 2
Human Rights in the U.S.-Vietnam Relationship ................................................................ 2
Congress’s Role ......................................................................................................................... 3
Brief History of the Normalization of U.S.-Vietnam Relations ....................................................... 3
Major Issues in U.S.-Vietnam Relations .......................................................................................... 5
Diplomatic Ties ......................................................................................................................... 5
The United States Increases Its Involvement in the South China Sea Dispute ................... 6
The Lower Mekong Initiative ............................................................................................. 8
Nuclear Diplomacy ............................................................................................................. 9
Economic Ties ......................................................................................................................... 11
Trade Initiatives: GSP, TIFA, BIT, and TPP ...................................................................... 12
Trade Friction .................................................................................................................... 12
U.S. Foreign Assistance to Vietnam ........................................................................................ 13
Human Rights Issues ............................................................................................................... 13
Overview ........................................................................................................................... 13
Press and Internet Freedoms ............................................................................................. 14
Ethnic Minorities ............................................................................................................... 15
Religious Freedom ............................................................................................................ 16
Workers’ Rights ................................................................................................................. 17
Human Trafficking ............................................................................................................ 19
The Vietnam Human Rights Act ....................................................................................... 19
Military-to-Military Ties ......................................................................................................... 20
Military Assistance ............................................................................................................ 21
Background ....................................................................................................................... 21
Vietnam War “Legacy” Issues ................................................................................................. 22
Agent Orange .................................................................................................................... 22
POW/MIA Issues............................................................................................................... 23
Conditions in Vietnam ................................................................................................................... 24
Economic Developments ......................................................................................................... 24
Vietnam’s Economic Troubles of 2007-2011 .................................................................... 24
Background ....................................................................................................................... 25
Vietnam’s Politics and Political Structure ............................................................................... 26
Leadership Team Selected at the 11th Party Congress ....................................................... 26
The National Assembly ..................................................................................................... 27
Sino-Vietnam Relations ........................................................................................................... 28
The Environment ..................................................................................................................... 29
Selected Legislation in the 113th Congress .................................................................................... 29

Figures
Figure 1. Map of Vietnam .............................................................................................................. 31
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U.S.-Vietnam Relations in 2013: Current Issues and Implications for U.S. Policy


Tables
Table 1. U.S.-Vietnam Merchandise Trade, Selected Years ........................................................... 11

Contacts
Author Contact Information........................................................................................................... 32

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U.S.-Vietnam Relations in 2013: Current Issues and Implications for U.S. Policy

Introduction
Since 2002, overlapping strategic and economic interests have led the United States and Vietnam
to improve relations across a wide spectrum of issues. Starting in 2010, the two countries
accelerated this process, effectively forming a partnership on several fronts. Obama
Administration officials identify Vietnam as one of the new strategic partners they are cultivating
as part of their “rebalancing” of U.S. priorities toward the Asia-Pacific, a move commonly
referred to as the United States’ “pivot” to the Pacific.1 In 2010, the two countries mobilized a
multinational response in 2010 to China’s perceived attempts to boost its claims to disputed
waters and islands in the South China Sea, and they have continued to work closely on issues of
maritime freedom and security. Additionally, the Obama Administration encouraged Vietnam to
be a “full partner” in the ongoing Trans Pacific Partnership (TPP) free trade agreement
negotiations and has given a higher priority to cleaning up sites contaminated by Agent
Orange/dioxin used by U.S. troops during the Vietnam War. Over the past several years, the two
sides also have signed a new agreement on civilian nuclear cooperation and have increased their
non-proliferation cooperation. As discussed in detail below, the biggest obstacle to the two
countries taking a dramatic step forward in their relationship is disagreements over Vietnam’s
human rights record.
U.S. Interests and Goals in the Bilateral Relationship
Currently, factors generating U.S. interest in the relationship include growing trade and
investment flows, the large ethnic Vietnamese community in the United States, the legacy of the
Vietnam War, increasing interaction through multilateral institutions, the perception that Vietnam
is becoming a “middle power” with commensurate influence in Southeast Asia, and shared
concern over the rising strength of China. U.S. goals with respect to Vietnam include opening
markets for U.S. trade and investment, furthering human rights and democracy within the
country, countering China’s increasing regional influence, cooperating to ensure freedom of
navigation in and around the South China Sea, and maintaining if not expanding U.S. influence in
Southeast Asia. The array of policy instruments the United States employs in relations with
Vietnam includes trade incentives and restrictions, foreign assistance, cooperation in international
organizations, diplomatic pressures, educational outreach, and security cooperation. Since 2010,
strategic concerns about China have taken on a larger role in the Obama Administration’s
formulation of U.S. policy toward Vietnam.
Vietnam’s Interests and Goals in the Bilateral Relationship
For Vietnam’s part, since the mid-1980s, Hanoi essentially has pursued a four-pronged national
strategy: (1) prioritize economic development through market-oriented reforms; (2) pursue good
relations with Southeast Asian neighbors that provide Vietnam with economic partners and
diplomatic friends; and (3) repair and deepen its relationship with China, while (4)
simultaneously buttressing this by improving relations with the United States as a counterweight
to Chinese ambition.2 By virtue of its economic importance and great power status, the United

1 For more, see CRS Report R42448, Pivot to the Pacific? The Obama Administration’s “Rebalancing” Toward Asia,
coordinated by Mark E. Manyin.
2 Marvin Ott, “The Future of US-Vietnam Relations,” Paper presented at The Future of Relations Between Vietnam
(continued...)
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States has loomed large not only in Vietnam’s strategic calculations, but also in domestic
developments. For instance, Vietnam’s protracted decision from 1999 to 2001 to sign and ratify
the landmark bilateral trade agreement (BTA) with the United States helped to break the logjam
that had effectively paralyzed debate in Hanoi over the future direction and scope of economic
reforms. Additionally, notwithstanding the legacies of the Vietnam War era, the Vietnamese
public appears to hold overwhelmingly positive views of the United States.3
There are a number of strategic and tactical reasons behind Vietnam’s efforts to upgrade its
relationship with the United States. Many Vietnamese policymakers seek to counter Chinese
ambitions in Southeast Asia, and preserve its territorial and other interest in the South China Sea,
by encouraging a sustained U.S. presence in the region. Vietnam also needs a favorable
international economic environment—for which it sees U.S. support as critical—to enable the
country’s economy to continue to expand so it can achieve its goal of becoming an industrialized
country by 2020. Securing greater access to the U.S. market, which already is the largest
destination for Vietnam’s export, would boost Vietnam’s economy and is a major reason Vietnam
is participating in the TPP negotiations.
A Ceiling on the Relationship?
Ultimately, the pace and extent of the improvement in bilateral relations is limited by several
factors, including Hanoi’s wariness of upsetting Beijing, U.S. scrutiny of Vietnam’s human rights
record, and Vietnamese conservatives’ suspicions that the United States’ long-term goal is to end
the Vietnamese Communist Party’s (VCP’s) monopoly on power through a “peaceful evolution”
strategy. However, it is possible that these concerns could be lessened, and the possibilities for
strategic cooperation increased, if the United States and Vietnam both believe China is becoming
unduly assertive in Southeast Asia.
Human Rights in the U.S.-Vietnam Relationship
As was true of their predecessors, Obama Administration officials have continuously expressed
concerns—including via public criticisms—about human rights incidents. In a November 2011
speech in Hawaii on the Obama Administration’s Asia policy, Secretary of State Hillary Rodham
Clinton stated, “ ... we have made it clear to Vietnam that if we are to develop a strategic
partnership, as both nations desire, Vietnam must do more to respect and protect its citizens’
rights.”4 Indeed, criticisms of Vietnam’s human rights record appear to have played a significant
role in convincing the Administration to oppose three items desired by Hanoi: a declaration of a
bilateral “strategic partnership,” a summit meeting with President Obama, and a decision to add
Vietnam to the United States’ Generalized System of Preferences (GSP) program, which would
eliminate tariffs on certain Vietnamese exports. Likewise, Vietnamese leaders do not appear
willing to fundamentally alter their treatment of dissenters or minority groups in order to more
rapidly advance strategic relations with the United States.

(...continued)
and the United States, SAIS, Washington, DC, October 2-3, 2003.
3 State Department Office of Research, Vietnam: U.S. Image Gets a Boost, Opinion Analysis, Washington, DC,
September 9, 2008.
4 Hillary Rodham Clinton, “America’s Pacific Century,” Remarks delivered at the East-West Center, Honolulu, HI,
November 10, 2011.
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However, differences over human rights have not prevented the two countries from improving
relations overall, despite many signs that human rights conditions have deteriorated over the past
few years. Barring a much more dramatic downturn in Vietnam’s human rights situation,
Administration officials appear to see Vietnam’s human rights situation not as an impediment to
short-term cooperation on various issues, but rather as a ceiling on what might be accomplished
between the two countries, particularly over the long term.
Congress’s Role
Throughout the process of normalizing relations with Vietnam, Congress has played a significant
role. Not only has Congress provided oversight and guidance, but it has shaped the interaction by
imposing constraints and providing relevant funding, as well as through its approval process for
agreements. Many Members have been at the forefront of efforts to highlight human rights
conditions in Vietnam, as well as “legacy issues” of the Vietnam War such as recovering the
remains of missing U.S. troops. In the 1990s and early 2000s, many Members of Congress who
favored improved bilateral relations provided the Clinton and George W. Bush Administrations
with political backing for their policies of upgrading relations with Vietnam. Notably, these
voices appear to have become less vocal in recent years, coinciding with a rising perception that
Vietnam’s human rights situation has deteriorated. U.S. and Vietnamese participation in the TPP
talks may provide Congress with another opportunity to exert influence over U.S.-Vietnam
relations; Congress must approve implementing legislation if the TPP is to apply to the United
States.
Brief History of the Normalization of
U.S.-Vietnam Relations
The United States’ post-World War II military involvement in Vietnam began in the early 1960s,
with the dispatch of military advisers to assist the South Vietnamese government in its battles
with communist North Vietnam and indigenous (i.e., South Vietnamese) communist forces.
Thereafter, the U.S. presence escalated. By the time the Nixon Administration withdrew U.S.
forces in 1973, millions of U.S. troops had served in Vietnam, with more than 50,000 killed.
The war became increasingly unpopular in the United States and in Congress. In 1973, following
the conclusion of a Paris Peace Agreement that brought an end to U.S. military involvement in
Vietnam, Congress began cutting Nixon Administration requests for military and economic
assistance to South Vietnam.
U.S.-Vietnam diplomatic and economic relations were virtually nonexistent for more than 15
years following North Vietnam’s victory in 1975 over South Vietnam. The United States
maintained a trade embargo and suspended foreign assistance to unified Vietnam.5 Obstacles to

5 Congressional resistance to aiding Vietnam was strong for much of the 1970s. In the FY1977 foreign aid
appropriations bill, Congress prohibited the use of any funds to provide assistance to Vietnam, a provision that was
repeated annually until its removal in 1994. Earlier in the decade, President Richard Nixon’s pledge to provide
reconstruction aid to North Vietnam proved unpopular in Congress. New York Times, June 12, 1973. Vietnamese
officials claimed that President Richard Nixon secretly had promised North Vietnamese Prime Minister Pham Van
Dong $4.7 billion in economic assistance as part of the Paris Peace Agreement, signed in January 1973, which led to
(continued...)
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improved relations included U.S. demands that Vietnam withdraw from Cambodia (which
Vietnam invaded in 1978), U.S. insistence on the return of/information about U.S. Prisoners of
War/Missing in Action (POW/MIAs), and Vietnamese demands that the United States provide
several billion dollars in postwar reconstruction aid, which they claimed had been promised by
the Nixon Administration.
A series of actions by Vietnam in 1978 in particular had a long-term negative effect on U.S.-
Vietnamese relations. Vietnam aligned itself economically and militarily with the Soviet Union
and invaded Cambodia, installing a government backed by 200,000 Vietnamese troops.6 China
conducted a one-month military incursion along Vietnam’s northern border in 1979, which led to
nearly three decades of disputes over the land border, and kept strong military pressure on
Vietnam until 1990. U.S. policy toward Vietnam was also influenced by the exodus of hundreds
of thousands of Vietnamese “boat people,” including many ethnic Chinese, who fled or were
expelled under Vietnam’s harsh reunification program.
Developments in the mid- and late 1980s set the stage for the rapid normalization of ties in the
following decade. Inside Vietnam, disastrous economic conditions and virtual diplomatic
isolation led the VCP to adopt (at its 6th National Party Congress in 1986) a more pragmatic, less
ideological, line. Hanoi adopted market-oriented economic reforms (dubbed doi moi, or
“renovation”), loosened many domestic political controls, and began to seek ways to extract itself
from Cambodia.
U.S.-Vietnam cooperation on the POW/MIA issue began to improve following a 1987 visit to
Vietnam by General John Vessey, President Reagan’s Special Emissary for POW-MIA Issues. As
Vietnam withdrew forces from Cambodia in 1989 and sought a compromise peace settlement
there, the George H. W. Bush Administration decided to improve relations with Hanoi, which was
also interested in restoring ties to the United States. In April 1991, the United States laid out a
detailed “road map” for normalization with Vietnam. Later that year, Vietnam allowed the United
States to open an office in Hanoi to handle POW/MIA affairs.
In 1993, President Clinton built on the thaw by signaling the end of U.S. opposition to Vietnam
receiving international financial assistance. In February 1994, President Clinton announced the
end of the U.S. trade embargo on Vietnam. Two months later, Congress passed the Foreign
Relations Authorization Act, Fiscal Years 1994 and 1995 (P.L. 103-236), which contained a
“Sense of the Senate” section expressing that chamber’s support for the normalization of relations
with Vietnam. Despite congressional efforts to tie normalization to the POW/MIA issue as well as
to Vietnam’s human rights record, President Clinton continued to advance U.S. relations with
Vietnam by appointing the first post-war ambassador to Vietnam in 1997 and signing the
landmark U.S.-Vietnam bilateral trade agreement (BTA) in 2000. Throughout this period, the
normalization process was made possible by Vietnam’s strategic desire to improve relations with
the United States, continued improvements in POW/MIA cooperation, Vietnam’s ongoing reform

(...continued)
the withdrawal of U.S. troops from South Vietnam. New York Times, February 2, 1973; Nayan Chanda, Brother Enemy
(New York: Harcourt Brace Jovanovich, 1986), p. 143.
6 Among the reasons Vietnam invaded were Cambodia’s incursions into Vietnamese territory after the Khmer Rouge
took power in 1975. Additionally, among the atrocities the Khmer Rouge committed before they were ousted by the
Vietnamese in 1949 were targeting ethnic Vietnamese as enemies of the state.
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efforts, and by Vietnam’s general cooperation on refugee issues. All of these issues remain on
Vietnam’s bilateral agenda.
President Clinton visited Vietnam from November 16-20, 2000, the first trip by a U.S. President
since Richard Nixon went to Saigon (now Ho Chi Minh City) in 1969. The visit was notable for
the unexpected enthusiasm expressed by ordinary Vietnamese, who thronged by the thousands to
greet or catch a glimpse of the President and the First Lady. These spontaneous outbursts,
combined with the President’s public and private remarks about human rights and
democratization, triggered rhetorical responses from conservative Vietnamese leaders. During the
visit, Vietnamese leaders pressed the U.S. for compensation for Agent Orange victims, for
assistance locating the remains of Vietnam’s soldiers still missing, and for an increase in the
United States’ bilateral economic assistance program.
Progress towards the resumption of normal bilateral relations continued under the George W.
Bush Administration. Despite growing concerns about the Vietnamese government’s human
rights record, Congress ratified the U.S.-Vietnam BTA in October 2001; the new agreement went
into effect on December 10, 2001. Under the BTA, the United States granted Vietnam conditional
normal trade relations (NTR), a move that significantly reduced U.S. tariffs on most imports from
Vietnam.7 In return, Hanoi agreed to undertake a wide range of market-liberalization measures.
Vietnam’s conditional NTR status was renewed every year until December 2006, when Congress
passed P.L. 109-432, a comprehensive trade and tax bill, that granted Vietnam permanent NTR
status as part of a wider agreement that saw Vietnam become a member of the World Trade
Organization (WTO) as of January 11, 2007.8
As discussed in the following section, during the Bush Administration, the United States and
Vietnam dramatically upgraded diplomatic and strategic aspects of their relationship to the point
where the two countries have all-but-normalized bilateral relations, at least from the U.S. point of
view. As discussed below, however, many Vietnamese still consider relations to not be completely
normalized until the United States provides more compensation for purported victims of “Agent
Orange” and/or drops its legal categorization of Vietnam as a non-market economy.
Major Issues in U.S.-Vietnam Relations
Diplomatic Ties
In the middle of the last decade, leaders in both Hanoi and Washington, DC, sought new ways to
upgrade the bilateral relationship. Two manifestations of this goal were the U.S. extending
Permanent Normal Trade Relations (PNTR) status to Vietnam in 2007 and four annual summits
from 2005 to 2008. The Bush Administration appeared to use these top-level meetings to
encourage economic and political reforms inside Vietnam.

7 Vietnam’s NTR status was conditional because it was subject to annual presidential and congressional review under
the U.S. Trade Act of 1974’s Jackson-Vanik provisions, which govern trade with non-market economies. Every year
between 1998 and 2006, Vietnam received a presidential waiver from the restrictions of the Jackson-Vanik provisions.
From 1998 to 2002, congressional resolutions disapproving the waivers failed in the House. Disapproval resolutions
were not introduced between 2003 and 2006, the last year of Vietnam’s conditional NTR status.
8 See CRS Report RL33490, Vietnam PNTR Status and WTO Accession: Issues and Implications for the United States,
by Mark E. Manyin, William H. Cooper, and Bernard A. Gelb.
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The intensity of high level U.S.-Vietnam diplomatic interaction peaked in 2010. During that year,
Secretary of State Hillary Rodham Clinton visited Vietnam in July and October, and then-
Secretary of Defense Robert Gates visited in October. The trips were partly due to Vietnam’s one-
year stint as chair of the Association of Southeast Asian Nations (ASEAN), during which time the
country served as host for a number of multilateral gatherings. The Obama Administration also
used them as occasions to signal its determination to increase its presence in Southeast Asia
generally, and upgrade its strategic relationship with Vietnam in particular. Of particular note,
during the July ASEAN Regional Forum (ARF) meeting, Vietnamese and U.S. officials
orchestrated a multilateral diplomatic push-back against perceived Chinese assertiveness in the
South China Sea. In October, Vietnam then convened and secured U.S. attendance in the first-
ever ASEAN Defense Ministers’ Meeting + 8 (ADMM Plus, a triennial gathering of the ministers
of defense from the 10 ASEAN countries accompanied by their counterparts from Australia,
China, India, Japan, Korea, New Zealand, and Russia), in which Secretary Gates participated and
reiterated U.S. concerns about China’s actions in the South China Sea. Later that same month,
Secretary Clinton traveled back to Hanoi to join in the East Asia Summit (EAS), the first time the
United States officially participated in the five-year-old gathering.
During one of her visits, Secretary Clinton summed up the new emphasis on Vietnam when she
stated that “the Obama Administration is prepared to take the U.S.-Vietnam relationship to the
next level…. We see this relationship not only as important on its own merits, but as part of a
strategy aimed at enhancing American engagement in the Asia Pacific and in particular Southeast
Asia.”9
Since 2010, the United States and Vietnam have deepened their cooperation across a range of
issues, though there has been considerably less interaction at the Cabinet level. Many Vietnamese
officials would like to arrange a bilateral summit, an event the Obama Administration appears to
be reluctant to schedule due in part to concerns about a deterioration in Vietnam’s human rights
conditions. Many Vietnamese policymakers also would like to enter into a formal “strategic
partnership” with the United States. Reportedly, discussions over this upgrade of the relationship
have stalled over the question of how to deal with human rights and religious freedom.10
The United States Increases Its Involvement in the South China Sea Dispute
Since 2007, even as official Sino-Vietnamese relations have expanded, bilateral tensions have
intensified over competing territorial claims in the South China Sea. China makes extensive
claims, including marking on its maps an ambiguous “nine dash line” that covers most of the sea,
including the Spratly and Paracel island groups. These claims overlap with those of Vietnam and
three other Southeast Asian nations—Brunei, Malaysia, and the Philippines—which themselves
have claims that conflict with each other. Taiwan also makes extensive claims mirroring those of
the PRC. China, Taiwan, and Vietnam each claim the Paracel Island chain in the northern part of
the sea. China controls them in practice, having forcibly taken control of the group in 1974 from
South Vietnam. Further south, the Spratly Island chain is claimed in totality by China, Taiwan,
and Vietnam, and partially by Brunei, Malaysia, and the Philippines. Each of the claimants except

9 U.S. Department of State, “Secretary of State Hillary Rodham Clinton Remarks With Vietnam Deputy Prime Minister
And Foreign Minister Pham Gia Khiem,” Government Guest House, Hanoi, Vietnam, July 22, 2010.
10 Carlyle Thayer, “Vietnam and the US: Convergence but Not Congruence,” February 13, 2013, available at
http://www.isn.ethz.ch/Digital-Library/Articles/Special-Feature/Detail/?lng=en&id=159647&contextid774=159647&
contextid775=159646&tabid=1453526659.
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Brunei occupies at least one of the Spratly islands or shoals. Virtually none of the landmasses in
the Spratlys is fully habitable, but control over them could give a claimant rights to an area
thought to be potentially rich in energy resources.
Since 2007, China has taken a number of unilateral actions to assert its claims, including
increasing seizures of Vietnamese fishing boats, reportedly warning Western energy companies
not to work with Vietnam to explore or drill in the disputed waters, announcing plans to develop
the disputed islands as tourist destinations, and cutting sonar cables trailed by seismic exploration
vessels working in disputed waters for PetroVietnam. Vietnam used its chairmanship of ASEAN
in 2010 to “internationalize” the disputes by forming a multi-country negotiation forum, which
would force China to negotiate in a multilateral setting.
A primary target of the Vietnamese campaign has been the United States, which has followed a
policy of neutrality on the claims by the parties. Throughout 2009 and early 2010, some
Vietnamese said that while they do not expect the United States to take sides in the dispute, it
would be helpful if the United States did more to emphasize, through language or actions, that all
parties to the dispute should adhere to common principles, such as promoting transparency,
adhering to the rule of law, refraining from undertaking unilateral actions, and committing to the
freedom of the seas and navigation.
Obama Administration officials proved receptive to Vietnam’s outreach. In July 2010, Secretary
of State Clinton stated at a regional meeting that freedom of navigation on the sea is a U.S.
“national interest” and that the United States opposes the use or threat of force by any claimant.
Clinton also said that “legitimate claims to maritime space in the South China Sea should be
derived solely from legitimate claims to land features,” which many interpreted as an attack on
the basis for China’s claims to the entire sea.11 Such remarks have become a staple of U.S.
officials’ statements on the South China Sea disputes, and U.S. policy since then has been to work
with Asian countries like Vietnam to include the disputes on the agenda of multilateral fora such
as the annual East Asia Summit (EAS) meeting. China generally objects to discussing maritime
security issues in multilateral settings, preferring to deal with the matter bilaterally. Relatedly, the
Obama Administration also has continued its policy of upgrading its defense ties with and the
capacities of many Southeast Asian militaries, particularly with Vietnamese security forces.

11 U.S. Department of State, “Secretary of State Hillary Rodham Clinton Remarks at Press Availability,” National
Convention Center, Hanoi, Vietnam, July 23, 2010.
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U.S. Interests in the South China Sea12
The South China Sea is the site of some of the world’s most complicated maritime territorial disputes. Roughly one
and a half times the size of the Mediterranean Sea, it is ringed by China, Vietnam, Malaysia, Indonesia, Brunei, the
Philippines, and Taiwan and dotted with hundreds of small islands, shoals, and reefs, some of them occupied by
individual claimants. This creates myriad overlapping claims, based on differing interpretations of historical boundaries
to landmasses in the region and differing interpretations of the United Nations Convention on the Law of the Sea
(UNCLOS). For instance, the U.S. position is that neither UNCLOS nor historical state practice negates the right of
military forces of all nations to conduct military activities in each other’s 200-mile Exclusive Economic Zone (EEZ)
without notification or consent. In contrast, China insists that reconnaissance activities undertaken without prior
notification and without permission of the coastal state violate Chinese domestic law and international law, and
Chinese authorities often have protested against U.S. maritime surveillance along China’s coast.13
The United States is not a claimant in the South China Sea, and has consistently taken no position on specific
territorial disputes in these waters. Instead, it has repeatedly asserted its own broad interests in freedom of
navigation and regional stability, and supported multilateral dialogues that foster stability, particularly discussions since
the early 1990s between China and Southeast Asian claimants over a Code of Conduct for disputants in the region.
East Asia’s large economies rely on freedom of navigation in the South China Sea. Roughly two-thirds of South
Korea’s energy supplies, 60% of Japan’s, and 60% of Taiwan’s pass through it, as do 80% of China’s oil imports.14 U.S.
strategic interests in the region include freedom of navigation including for U.S. surveillance vessels, the protection of
substantial trading interests, and the promotion of economic development including offshore energy development and
sustainable management of fishery stocks and other resources. The United States also seeks to encourage China’s
development as a responsible international actor while balancing and protecting the interests of U.S. al ies and
strategic partners in Southeast Asia.
The Lower Mekong Initiative
One aspect of the Obama Administration’s upgrading its relationship with Vietnam involves
forming partnerships in multilateral fora. One such group, created in 2009, is the Lower Mekong
Initiative (LMI), comprised of the United States and the lower Mekong countries (i.e.
Burma/Myanmar, Cambodia, Laos, Thailand, and Vietnam). The LMI’s broad agenda is to foster
cooperation and capacity building among the five Southeast Asian participants in the areas of
education, health, environment, and infrastructure. The State Department describes the initiative
as “the primary U.S.-led platform for advancing Mekong sub-regional integration” and boosting
development among Cambodia, Laos, Thailand, and Vietnam (Burma joined the LMI in 2012).15
LMI priority areas include education, the environment, health, regional infrastructure, and
women’s issues. Another motivation for the LMI is to monitor and coordinate responses to the
construction of dams—particularly but not exclusively those being built in China—and other
projects on the upper portions of the Mekong that are affecting the downriver countries.16 Foreign
ministers from participating countries have held five meetings, the last during Secretary Clinton’s
July 2012 visit to Cambodia to participate in the ASEAN Regional Forum meeting.
Although the United States has pledged or spent over $300 million to support health,
environment, and education programs in the Lower Mekong region since 2009, its direct

12 Written by Ben Dolven, CRS Specialist in Asian Affairs.
13 For more, see Bonnie S. Glaser, Armed Clash in the South China Sea, Council on Foreign Relations Center for
Preventive Action Contingency Planning Memorandum No. 14, April 2012.
14 Ibid.
15 “Rebalance to the Asia-Pacific,” November 2012 State Department communication with CRS.
16 Catharin Dalpino, “Bureaucratic Suspense at Phuket,” Asia Security Initiative blog, posted on July 17, 2009,
http://asiasecurity.macfound.org/.
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spending on the LMI has been an order of magnitude below this amount. In July 2012, at the
ASEAN Regional Forum (ARF) in Phnom Penh, Secretary Clinton acknowledged that while Asia
had become a “strategic priority,” new development assistance had lagged. At the meeting,
Clinton announced the creation of the Asia Pacific Strategic Engagement Initiative (APSEI),
which would significantly expand LMI programming. The first stage of the Initiative included a
three-year, $50 million program, the “Lower Mekong Initiative (LMI) 2020.”17 The
Administration’s FY2014 foreign operations budget requests $15 million for the LMI, though it is
not clear how much of this is new funding or programming.
Nuclear Diplomacy18
As its economy has grown, so have Vietnam’s energy demands, which according to one source
grew by 15% annually in the first decade of the century.19 Energy consumption is expected to
more than triple between 2015 and 2030. To help keep pace, Vietnam plans to build its first 10
nuclear power plants between 2020 and 2030, with construction on the first to begin in 2015.20
The percentage of nuclear power in Vietnam’s energy mix is expected to be 20% by 2050. Russia
will build the first two reactors at PhuocDinh in the southern Ninh Thuan province, southwest of
Cam Ranh Bay, totaling 2,000 MW. Russia will also finance 85% of the project. Japan will build
an additional two reactors also totaling 2,000 MW of capacity at Vinh Hai, also in Ninh Thuan
province. Current plans include an additional 6,000 MW to be built by 2030.
The United States and Vietnam are currently negotiating a civilian nuclear energy agreement. In
March 2010, the United States and Vietnam signed a Memorandum of Understanding Concerning
Cooperation in the Civil Nuclear Field that is designed to increase cooperation in a number of
areas. Then-U.S. Ambassador to Vietnam Michael Michalak said he anticipated the agreement
would be a “stepping stone” to a bilateral nuclear energy cooperation agreement, which, under
Section 123 of the Atomic Energy Act, would be subject to congressional review.21
In the meantime, the U.S. Department of Energy (DOE) and the Nuclear Regulatory Commission
have been training Vietnamese officials on nonproliferation and nuclear safety best practices
related to power plant operation, and assisted with the drafting of Vietnam’s Atomic Energy Law,
passed in June 2008. The U.S. State Department’s Export Control and Border Security Program
(EXBS) has provided assistance to Vietnam to strengthen export controls in the country. An
effective export control regime is considered a key prerequisite to establishing a nuclear power
program in a country.
One potential issue discussed in media reports has been whether or not the United States should
require Vietnam to include a pledge in the nuclear cooperation agreement that says Vietnam

17 “Clinton Talks Cash Injections at ASEAN,” Phnom Penh Post, July 12, 2012; Department of State, Lower Mekong
Initiative: Fact Sheet, July 13, 2012.
18 This section written by Mary Beth Nikitin, Specialist in Nonproliferation, mnikitin@crs.loc.gov, 7-7745. For more,
see CRS Report RS22937, Nuclear Cooperation with Other Countries: A Primer, by Paul K. Kerr and Mary Beth
Nikitin.
19 Economist Intelligence Unit, Vietnam: Energy Report, December 16, 2009.
20 World Nuclear Association, Nuclear Power in Vietnam, updated May 2013, http://www.world-nuclear.org/info/
vietnam_inf131.html.
21 U.S. Embassy Hanoi, “Ambassador’s Speech Remarks at the Signing Ceremony for Nuclear Cooperation MOU,”
March 30, 2010.
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would not build fuel cycle facilities on its territory.22 This would include enrichment and
reprocessing technology that can be used to make fuel or to make material required for a nuclear
weapon. The State Department spokesman has said that the United States would welcome a
commitment by Vietnam not to pursue enrichment, but that this would be Vietnam’s sovereign
decision, and Vietnam does have a right to pursue enrichment under the Non-Proliferation
Treaty.23 A commitment to forego enrichment is not required for bilateral nuclear cooperation
agreements under U.S. law, and most past 123 agreements have not included such a pledge. A
recent agreement with the United Arab Emirates included a provision that would preclude
enrichment or reprocessing in the UAE, and the United States has pursued similar pledges from
other states in the Middle East. However, how this policy would apply to other regions of the
world is under interagency review. A senior DOE official said in September 2010 that it would be
“inappropriate” at that stage to ask Vietnam to foreswear its fuel cycle options as part of a nuclear
energy cooperation agreement.24 The Vietnamese Atomic Energy Institute Director Vuong Huu
Tan has said that Vietnam does not plan to pursue enrichment.25 The Russian power reactors that
Vietnam has under contract include full fuel services and could preclude a commercial need for
such facilities in the near-term.
Vietnam has also been an active participant in U.S. and global nonproliferation initiatives. In
September 2012, Vietnam’s Additional Protocol safeguards agreement with the International
Atomic Energy Agency entered into force. Vietnam has been a member of the Nuclear Non-
Proliferation Treaty since June 1982. With U.S. Department of Energy assistance under the
Global Threat Reduction Initiative, Vietnam has been converting its Soviet/Russian-supplied
research reactor in Dalat from highly enriched uranium (HEU) to low enriched uranium fuel, and
returning the HEU fuel to Russia. Attending the April 2010 nuclear security summit in
Washington, DC, Vietnamese Prime Minister Dung pledged to continue to convert the Dalat
research reactor, as well as to join the Global Initiative to Combat Nuclear Terrorism. In
December 2010, the United States and Vietnam established a legal framework for U.S.-Vietnam
cooperation for full conversion of the research reactor and the return of HEU spent fuel from
Dalat to Russia.26 In March 2012, Vietnam and Russia signed an agreement on the repatriation to
Russia of spent HEU research reactor fuel at Dalat. The shipments are to be completed by the end
of 2013. Also, Vietnam and South Korea are developing a real-time tracking system for the
movement of radiological materials in the country in cooperation with the IAEA.27

22 Jay Solomon, “U.S., Hanoi in Nuclear Talks,” The Wall Street Journal, August 5, 2010. Uranium enrichment
facilities can produce fuel for nuclear reactors, as well as fissile material for nuclear weapons. Highly enriched uranium
and plutonium are the types of fissile material used in nuclear weapons.
23 State Department Briefing, August 5, 2010.
24 Daniel Horner, “Lawmakers Eye Fixes to Law on Nuclear Pacts,” Arms Control Today, October 2010.
25 “US-Vietnam nuke deal will likely allow enrichment,” Associated Press, August 7, 2010.
26 U.S. Embassy Hanoi, “U.S. and Vietnam Cooperation on Nuclear Non-Proliferation in Dalat,” December 8, 2010.
27 “Highlights of Achievements and Commitments by Participating States,” Seoul Nuclear Security Summit, 2012,
http://www.thenuclearsecuritysummit.org/userfiles/
Highlights%20of%20the%20Seoul%20Nuclear%20Security%20Summit(120403).pdf.
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Economic Ties28
Economic ties are the most mature aspect of the bilateral relationship, as symbolized by the two
countries’ participation in the nine-country Trans Pacific Strategic Economic Partnership (TPP)
free trade agreement negotiations. Since the mid-2000s, the United States has been Vietnam’s
largest export market, to the point where in 2011, exports to the United States represented about
17% of Vietnam’s total exports. China is Vietnam’s single largest trading partner, and its
economic importance—particularly as a source of imports—to Vietnam has been growing in
recent years. Collectively, U.S. firms have become one of the country’s largest sources of foreign
direct investment (FDI). U.S. companies’ cumulative FDI still lags behind many European and
Asian competitors, which had a head start in operating in Vietnam. Since 2002, Vietnam has run
an overall current account deficit with the rest of the world.
U.S.-Vietnam trade has soared since the early 2000s. As shown in Table 1, trade flows were
nearly $25 million in 2011, more than three times the level they were in 2006, the year before the
United States restored permanent normal trade relations status to Vietnam. Increased bilateral
trade also has been fostered by Vietnam’s market-oriented reforms and the resulting growth in its
foreign-invested and privately owned sectors. Over 75% of the increase in U.S.-Vietnam trade
since 2001 has come from the growth in imports from Vietnam, particularly clothing items.
Indeed, Vietnam has emerged as the United States’ second-largest source of imported clothing,
after China, and is a major source for footwear, furniture, and electrical machinery.
Table 1. U.S.-Vietnam Merchandise Trade, Selected Years
millions of U.S. dollars

Total Trade
U.S.
U.S.
Imports
Exports
Change
from
to
from
Vietnam
Vietnam Volume prior yr.
Trade Balance
1994 50.5
172.2
222.7
—
121.7
2000 827.4
330.5
1,157.9
—
-496.9
2001 1,026.4
393.8
1,420.2
23%
-632.6
2002 (NTR extended)a 2,391.70
551.9
2,943.60
107% -1,839.8
2005 6,522.3
1,151.3
7,673.6
22%
-5,371.0
2007 (PNTR Extended)a 10,541.2 1,823.3 12,364.5 31%
-8,717.9
2010
14,784.4
3,539.5
18,323.9 20% -11,244.9
2011
17,364.3
4,153.1
21,517.4 17% -13,211.2
2012
20,105.0
4,345.0
24,450.0 14% -15,760.0
Jan - Apr 2012
6,056.0
1,308.0
7,364.0 —
-4,748.0
Jan - Apr 2013
7,097.0
1,657.0
8,754.0 19% -5,440.0

28 For more, see CRS Report R41550, U.S.-Vietnam Economic and Trade Relations: Issues for the 113th Congress, by
Michael F. Martin.
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Source: U.S. International Trade Commission. Data are for merchandise trade on a customs basis.
a. Normal trade relations (NTR) status was extended to Vietnam in December 2001, when the U.S.-Vietnam
bilateral trade agreement went into effect. Thus, 2002 was the first full year in which Vietnam benefitted
from NTR status. Likewise, 2007 was the first ful year Vietnam received permanent normal trade relations
(PNTR) status, which was extended to Vietnam in December 2006.
Trade Initiatives: GSP, TIFA, BIT, and TPP
Obtaining GSP status from the United States is an important objective for Vietnam. The week
before Prime Minister Dung’s June 2008 visit to Washington, the Bush Administration announced
it would begin a review of whether Vietnam meets the eligibility criteria for designation as a
beneficiary country under the GSP program. The primary purpose of the program, which the
United States and other industrial countries initiated in the 1970s, is to promote economic growth
and development in developing countries by stimulating their exports.29 The Obama
Administration has yet to make a decision about entering Vietnam into the GSP program.
Legislation submitted in the 112th Congress, H.R. 5157 (Lofgren), would have prohibited
Vietnam’s entry into the GSP program unless the Vietnamese government made certain
improvements in the human rights and trafficking in persons arenas.
The most ambitious trade initiative with Vietnam involves negotiating a multilateral free trade
agreement under the Trans-Pacific Partnership (TPP).30 According to many sources, Vietnam’s
presence in the talks has created challenges because in contrast to most other participants it is a
developing economy with considerable government intervention. As part of its desire to use the
TPP talks to achieve greater access to the U.S. market, Vietnam is trying to persuade the United
States to relax its rules on textile trade, among other items. U.S. and other backers of Vietnam’s
participation in the negotiations believe that it further opens a sizeable market to U.S. exports and
investments, could accelerate economic reforms in Vietnam, and could set a precedent for the
entry into the agreement of other countries, such as China, with sizeable government intervention
in their economies.
Trade Friction
As bilateral economic relations have expanded, so have trade disputes. Significant areas of
friction include clothing trade, fish (particularly catfish), the United States’ designation of
Vietnam as a “non-market economy” (NME), Vietnam’s record on protecting intellectual rights,
and concerns over Vietnam’s currency policies.31 Vietnamese officials are particularly concerned
about the first three issues, and about the number of anti-dumping suits that have been initiated
against Vietnamese exporters for allegedly selling products in the United States at prices below
their “normal value.” In general, while bilateral trade disputes have been irritants, as of mid-2013
they have not spilled over to affect the course or tone of bilateral relations.

29For more, see CRS Report RL34702, Potential Trade Effects of Adding Vietnam to the Generalized System of
Preferences Program, by Vivian C. Jones and Michael F. Martin.
30 For more, see CRS Report R40502, The Trans-Pacific Partnership Agreement, by Ian F. Fergusson and Bruce
Vaughn.
31 Under the terms of its entry into the WTO, Vietnam will retain its designation as a “non-market economy” (NME)
until 2019, making it procedurally easier in many cases for U.S. companies to initiate and succeed in bringing anti-
dumping cases against Vietnamese exports. Vietnamese officials would like the United States to recognize Vietnam as
a market economy.
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U.S. Foreign Assistance to Vietnam
As the normalization process has proceeded, the U.S. has eliminated most of the Cold War-era
restrictions on aid to Vietnam. U.S. assistance has increased markedly from the approximately $1
million that was provided when assistance was resumed in 1991. Annual aid levels increased
steadily during the 1990s, rising to the $20 million level by 2000. The George W. Bush
Administration raised bilateral assistance by an order or magnitude—aid surpassed $100 million
by the late 2000s—and made Vietnam one of the largest recipients of U.S. aid in East Asia. U.S.
assistance to Vietnam in FY2011 was over $140 million. For FY2013, the Obama Administration
expects to spend over $100 million on aid programs in Vietnam. Most of the decline comes from
reduced spending on programs to combat HIV/AIDS and to promote market-oriented reforms. In
recent years, some Members of Congress have attempted to link increases in non-humanitarian
aid to progress in Vietnam’s human rights record (see the “Human Rights Issues” section).
The U.S. bilateral aid program is dominated by health-related assistance. In particular, spending
on HIV/AIDS treatment and prevention in Vietnam has risen since President Bush designated
Vietnam as a “focus country” eligible to receive increased funding to combat HIV/AIDS in June
2004 under the President’s Emergency Plan for AIDS Relief (PEPFAR).32 Some Vietnamese, as
well as some Western aid providers, have questioned the wisdom of allocating these sums of
money for Vietnam, which does not appear to have a severe HIV/AIDS problem. Other sizeable
U.S. assistance items include programs assisting Vietnam’s economic reform efforts and
governance, programs to combat trafficking in persons, and de-mining programs. Cumulatively,
the 110th, 111th, and 112th Congresses have appropriated over $60 million for cleaning up dioxin
storage sites as of April 2010 (see the “Agent Orange” section).
The governments of the United States and Vietnam run a number of educational exchange
programs. These generally total around $10 million a year, a sum not included in the above
estimates of U.S. assistance.
Human Rights Issues
Overview
Vietnam is a one-party, authoritarian state. For more than a decade, the Vietnamese Communist
Party appears to have followed a strategy of permitting most forms of personal and religious
expression while selectively repressing individuals and organizations that it deems a threat to the
party’s monopoly on power. On the one hand, the gradual loosening of restrictions since
Vietnam’s doi moi (“renovation”) economic reforms were launched in 1986 has opened the door
for Vietnamese to engage in private enterprise and has permitted most Vietnamese to observe the
religion of their choice. Since 2004, according to several reports, there have been indications that
personal freedoms have expanded for many Vietnamese, including those in the Central Highlands
and Northwest Highlands regions, two regions whose large minority populations have made them
particular centers of human rights concerns.

32 Vietnam qualified for the designation in part because of its demonstrated commitment to fighting the epidemic on its
own and because of the competency of its medical institutions. Vietnam is estimated to have about 100,000 people
living with the HIV/AIDS virus, a number that is projected to grow significantly.
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On the other hand, the authorities crack down harshly on what it deems to be anti-government
activity. Indeed, according to numerous accounts, since at least early 2007 the Vietnamese
government’s suppression of dissent has intensified and its tolerance for criticism has lessened
markedly. Moreover, these accounts generally agree that trends have worsened in the first half of
2013. For instance, Human Rights Watch states that 50 Vietnamese were convicted in political
trials in the first five months of 2013, more than the total number of political prisoners convicted
in 2012.33 As opposed to a massive suppression, the Vietnamese government’s actions appear to
be selective, targeting specific individuals and organizations who have called for the institution of
democratic reforms and/or publicly criticized government policy on sensitive issues, such as
policy toward China. More dissident groups began to publicly appear beginning in 2006. It is
unclear to what extent these groups or their various goals are supported by the broader
Vietnamese public. Most analysts believe that the pro-democracy movement in Vietnam is much
too weak to pose any systemic threat to the VCP. However, the government’s heightened
sensitivity and stiffened response may be due to its concerns about growing public discontent
over alleged government corruption, land seizures by government institutions and officials,
worsened economic conditions, and a sense among some Vietnamese that Hanoi has been unable
to prevent China from asserting its maritime claims at Vietnam’s expense. Additionally, reported
power struggles among Vietnam’s top leaders may be contributing to the intensified crackdown.
Press and Internet Freedoms
Vietnam has a variety of newspapers and magazines available, but virtually all of them are
published by government or party organizations. For example, Thanh Nien, a leading daily
newspaper, is published by the Vietnam National Youth Federation. In recent years, Vietnam’s
press has demonstrated a greater willingness to cover stories and issues that could be
controversial or risk post-publication reprisals from the Vietnamese government, such as
allegations of official corruption or incompetence. At times, the Vietnamese government appears
to appreciate these stories, as they help combat corruption among VCP and government officials.
However, a journalist or publication that crosses the vague and fluid boundary of acceptability
frequently faces official retribution, including loss of job, temporary closure, fines, and possibly
imprisonment. For example, Nguyen Van Khuong, a reporter for the Tuoi Tre daily newspaper,
was sentenced to four years in prison in September 2012 for writing articles about alleged police
bribery in Ho Chi Minh City.34 According to many reports, such cases of journalists and editors
being arrested, tried, and sentenced have been on the rise since at least 2008.
Since 2009, the Vietnamese government has been particularly harsh on Internet publications,
blogs, and their authors. In January 2013, Vietnamese courts sentenced five bloggers and Internet
activists to sentences of up to 13 years for activities undermining national unity and distributing
propaganda against the Vietnamese government. In September 2012, three other bloggers
received extended prison sentences for similar offenses resulting from their Internet writings.
Besides targeting journalists and bloggers, the Vietnamese government has also brought charges
against lawyers who have represented the accused in court or have spoken out against the
Vietnamese government. According to some human rights advocates, a 2012 decree will require
internet users to use their real names and may compel foreign Internet service providers to

33 Testimony of John Sifton, Asia Advocacy Director, Human Rights Watch, “Continuing Repression by the
Vietnamese Government,” a hearing by the House Subcommittee on Africa, Global Health, Global Human Rights, and
International Organizations, June 4, 2013.
34 “Vietnamese Journalist Jailed for Undercover Bribery,” Committee to Protect Journalists, September 7, 2012.
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relocate their data centers and establish local offices in Vietnam. This could make it easier for the
Vietnamese government to monitor data processed by these companies and/or more susceptible to
government pressure on issues such as censorship. In September 2012, Prime Minister Dung
reportedly called on the Ministry of Public Security to scrutinize and punish bloggers whose
websites were not approved by the authorities.35
Many of the targeted blogs, bloggers, and lawyers criticized Vietnam’s policy toward China
and/or have links to pro-democracy activist groups such as Bloc 8406, the banned Democratic
Party of Vietnam, or the banned Independent Workers’ Union of Vietnam. There are reports that
these groups have received help from expatriate Vietnamese, including some in the United States,
a charge that Vietnamese officials often make in conversations with their U.S. counterparts.
Ethnic Minorities
Ethnic minorities account for the majority of the population in three regions of the country: the
Central Highlands (home to Montagnard groups), the Northwest Highlands (Hmong), and along
portions of the Mekong Delta in the south (Khmer). A number of these minority groups report
cases of discrimination and repression. The situations in all three regions are complicated. In
each, the groups that frequently clash with government authorities are often from ethnic
minorities, belong to religious groups (such as Protestant denominations) that are not legally
recognized by the government, and/or at various points in history have opposed being ruled by
Vietnam’s dominant ethnic group (the Kinh) and by the communist government.
Many of the larger-scale tensions between the government and minority groups occur because of
protests against land seizures by local government officials. Indeed, corruption related to
inappropriate land use is one of the most sensitive and problematic issues for Vietnam. In
Vietnam, the state owns the land on behalf of the people of Vietnam. Residents and investors can
buy and sell “land-use rights,” but the government legally can reclaim land, often with allegedly
low levels of compensation.36 Many of the larger-scale tensions between the government and
minority groups (including religious minorities) occur when land used by these groups—which
already feel they have been the victims of discrimination, harassment, or worse—is seized by
local government officials, some of whom allegedly personally profit from the transaction. To
respond to the discontent, Vietnam’s National Assembly is in the process of revising the country’s
land law and land policies, though the VCP’s Central Committee in 2012 reportedly issued
guidance that the reforms could not include private land ownership.
According to several sources, abuses against the “Montagnards” who live in the country’s Central
Highlands region appear to have fallen since the last major anti-government protests in 2004.
Various government programs have attempted to improve educational and economic opportunities
for minorities in the region.37 (For the location of the Central Highlands region, see Figure 1 at

35 Viet Tan Briefing, “Vietnamese Authorities Mandate Google, Facebook, and other Internet Companies to Assist in
Online Censorship,” April 11, 2012; Human Rights Watch, “Vietnam: Crackdown on Critics Escalates,” February 1,
2013.
36 Economist Intelligence Unit, Country Commerce: Vietnam, April 2010, p. 30.
37 “Montagnard” is a French term meaning “mountain people” that is often used to refer to the various indigenous
ethnic minorities in Vietnam’s central and northern mountain areas. According to Human Rights Watch, there are
approximately one million Montagnards in the Central Highlands, comprised of approximately six ethnic groups. Since
the end of the Vietnam War, millions of ethnic Kinh (Vietnam’s dominant ethnic group) from Vietnam’s lowlands have
migrated into the Central Highlands. Coffee and rubber plantations also have sprouted in the region. The ensuing land
(continued...)
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the end of this report.) However, restrictions on foreigners’ access to the region and to
Montagnards who have fled to Cambodia complicate accurate reporting. No major
demonstrations appear to have taken place in the Central Highlands since 2008. Some human
rights advocates have criticized the U.S. government for failing to advocate sufficiently for the
release of the scores, if not hundreds, of Montagnards who have been imprisoned since 2001, as
well as for the dozens of Montagnards who have fled to Thailand seeking asylum in a third
country. Additionally, some Montagnard-Americans have complained that the Vietnamese
authorities either have prevented them from visiting Vietnam or have been subjected to
interrogation upon re-entering the country on visits. As for the Northwest Highlands, in 2011,
Vietnamese authorities reportedly forcibly suppressed protests by ethnic Hmong, the first such
unrest in that region in years.
Reports of abuses against ethnic Khmer in the Mekong Delta region peaked in 2007 and 2008,
when widespread protests erupted against local government land seizures. There do not appear to
have been large-scale demonstrations or protests since that time, though it is unclear whether this
is due to the resolution of the underlying issues or to the government’s crackdown against the
protest leaders.
Religious Freedom
Buddhism is the dominant religion in Vietnam, comprising approximately half of the population,
according to the State Department. An estimated 7% of the population is Roman Catholic, which
is concentrated in the southern part of the country. Other religious groupings include Cao Dai
organizations (2.5%-4%), Hoa Hao (the one officially recognized sect comprises 1.5%-3% of the
population), Protestant groups (recognized groups comprise 1%-2%), and Muslim organizations
(less than 0.1%).38
According to a variety of reports, most Vietnamese now are able to observe the religion of their
choice. However, while the freedom to worship generally exists in Vietnam, the government
strictly regulates and monitors the activities of religious organizations. Periodically, authorities
have increased restrictions on certain groups. Although the constitution provides for freedom of
religion, Vietnamese law requires religious groups to be officially recognized or registered.
According to many reports, the government uses this process to monitor and restrict religious
organizations’ operations. Additionally, many groups either refuse to join one of the official
religious orders or are denied permission to do so, meaning that these groups’ activities
technically are illegal. This legal status can make their leaders and practitioners vulnerable to
arrest and harassment. Human Rights Watch and other groups have reported harassment over the
past three years against a number of unrecognized branches of several faiths, including the Cao
Dai church; the Hoa Hao Buddhist church; independent Protestant house churches (particularly in
the Central Highlands); Khmer Krom Buddhist temples in the Mekong Delta; and the Unified
Buddhist Church of Vietnam (UBCV).39

(...continued)
pressures have resulted the loss of ancestral homeland by many Montagnards. Hundreds of thousands of Central
Highlands Montagnards are thought to be evangelical Protestants.
38 State Department Bureau of Democracy, Human Rights, and Labor, “July-December, 2010 International Religious
Freedom Report. Vietnam,” September 13, 2011.
39 Human Rights Watch, “EU–Vietnam Human Rights Dialogue: Human Rights Watch Recommendations,” January
10, 2012.
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Disputes between the government and religious groups have been growing in recent years over
the seizure of church and temple land by local governments. Many of these cases involve recent
confiscations for both civic reasons (e.g. public works projects) and also for resale that allegedly
benefits local government officials and/or their families. In many cases involving the Catholic
Church, tensions have arisen over historical grievances. The VCP reportedly has warned that
“social disorder” arising from land disputes over religious property will be strictly punished.40
Claims of religious discrimination in Vietnam are sometimes blurred because of the political
activism of noted religious figures. For example, Roman Catholic priest Father Nguyen Van Ly
and UBCV leader Thich Quang Do are two prominent religious leaders who have also been vocal
in their opposition to the VCP and their support for multi-party democracy, and as a result, have
been convicted of crimes against the Vietnamese government.
In 2004, the State Department designated Vietnam as a “country of particular concern” (CPC),
principally because of reports of worsening harassment of certain ethnic minority Protestants and
Buddhists. When the Vietnamese responded by negotiating with the Bush Administration and
adopting internal changes, the two sides reached an agreement on religious freedom, in which
Hanoi agreed to take steps to improve conditions for people of faith, particularly in the Central
Highlands. The May 2005 agreement enabled Vietnam to avoid punitive consequences, such as
sanctions, associated with its CPC designation. The agreement was faulted by human rights
groups on a number of grounds, including the charge that religious persecution continues in the
Central Highlands. Vietnam was redesignated a CPC in the 2005 and 2006 Religious Freedom
Reports.
In November 2006, the State Department announced that because of “many positive steps” taken
by the Vietnamese government since 2004, the country was no longer a “severe violator of
religious freedom” and was removed from the CPC list. The announcement, which came two
days before President Bush was due to depart to Hanoi for the APEC summit, cited a dramatic
decline in forced renunciations of faith, the release of religious prisoners, an expansion of
freedom to organize by many religious groups, and the issuance of new laws and regulations, and
stepped up enforcement mechanisms. Over the course of 2006, as part of the bilateral U.S.-
Vietnam human rights dialogue, Vietnam released a number of prominent dissidents the Bush
Administration had identified as “prisoners of concern.” Vietnam also reportedly told the United
States that it would repeal its administrative decree allowing detention without trial. The U.S.
Committee on International Religious Freedom, among others, has disputed the Administration’s
factual basis for the decision to remove Vietnam from the CPC list, arguing that abuses continue
and that lifting the CPC label removes an incentive for Vietnam to make further improvements.
Members of Congress have introduced several pieces of legislation that have called on the State
Department to re-list Vietnam as a CPC.41
Workers’ Rights
Vietnam’s participation in the TPP trade negotiations and application to join the GSP program
have focused attention on labor conditions in Vietnam. The government and the VCP’s efforts to
maintain one-party rule while adapting to rapid social and economic changes may help to explain
the often contradictory trends that can be observed in Vietnam’s evolving labor rights regime.

40 Economist Intelligence Unit, Vietnam Country Report, January 2012, p. 5.
41 During the 111th Congress The House passed one such measure, H.Res. 20.
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On the one hand, all Vietnamese workers have the right to belong to a union and all factories are
to have a union. According to a number of sources, over the years Vietnam has made significant
improvements in its labor laws over the years and often the central government has indicated a
desire to improve working conditions and protect certain worker rights. In 2012, the National
Assembly passed new Trade Union Act and a revised Labor Code. The State Department, in its
2012 report on human rights on Vietnam, identified a number of provisions of both measures that
could lead to improvements in working conditions and an expansion of workers’ rights. The
report also states that the government generally has tolerated strikes, despite the fact that most
have been technically illegal because they did not follow the legally proscribed conciliation and
arbitration process.42
On the other hand, Vietnamese workers are not free to form their own independent unions. All
unions must belong to the Vietnam General Confederation of Labor (VGCL), an organ of the
VCP that approves and manages subsidiary unions. The State Department in its 2012 report stated
that the Vietnamese government limited workers’ ability to form and join independent unions.
The advocacy group Human Rights Watch has raised concern about the ability of Vietnamese
workers to call an official strike, especially at state-owned enterprises (SOEs).43 Vietnamese
authorities reportedly have arrested, harassed, and intimidated leaders of independent unions,
such as the United Workers-Farmers Organization of Vietnam, a group formed in 2006 that
publicly calls for the right to form independent unions. Analysts have observed that the absence
of a true right of association in Vietnam has impeded the improvement of labor rights in other
areas. Collective bargaining agreements remain the exception rather than the rule. Rapid
economic expansion, corruption, and shortages of funds, training, and personnel reportedly have
made it extremely difficult for government authorities to enforce Vietnam’s labor laws.
Many conclude that since the launch of the doi moi reforms, worker rights have made progress
despite the restrictions on the right to organize. A comprehensive and detailed Labor Code was
passed in 1994 and was revised in 2002 and in 2006. Among other advances, the original 1994
code recognized workers’ right to strike, albeit under prescribed conditions. The 2006
amendments, prompted in part by a surge in strikes, for the first time allowed workers to choose
their own representatives to negotiate disputes at the thousands of enterprises where no union
exists. In the past, the VGCL had been the only organization allowed to represent workers.
Additionally, the government for the most part has not moved against strikes, despite the fact that
most have been technically illegal (because they were organized by “labor associations,” and not
officially sanctioned unions). It may also help that most strikes appear to be at foreign-invested
enterprises.
The Vietnamese government appears to accept that it has problems with the enforcement of its
labor laws. In 2008 and 2009, for instance, Vietnam’s official news agencies—Thanhnien News,
Vietnam Net, and Voice of Vietnam News—ran a series of reports describing problems with

42 Many conclude that since the launch of the doi moi reforms, worker rights have made progress despite the
restrictions on the right to organize. A comprehensive and detailed Labor Code was passed in 1994 and was revised in
2002 and in 2006. Among other advances, the original 1994 code recognized workers’ right to strike, albeit under
prescribed conditions. The 2006 amendments, prompted in part by a surge in strikes, for the first time allowed workers
to choose their own representatives to negotiate disputes at the thousands of enterprises where no union exists. In the
past, the VGCL had been the only organization allowed to represent workers.
43 Human Rights Watch, Not Yet a Workers’ Paradise, New York, NY, May 2009.
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Vietnam’s protection of worker’s rights, the flaws of the VGCL, and efforts to improve working
conditions in Vietnam.44
Human Trafficking45
Vietnam is both a source and destination for people trafficked for forced labor and commercial
sexual exploitation. Additionally, state-owned and private labor export companies send tens of
thousands of Vietnamese construction, fishing, and manufacturing workers overseas, where many
are vulnerable to abuse and exploitation. Vietnamese reportedly incur some of the highest debts,
due among other factors to high recruitment fees, among Asian expatriate workers. According to
the State Department, the Vietnamese government does not provide adequate remedies to workers
in these programs who fall into debt bondage or are tricked into other forced labor situations.46
Since 2001, the first year in which the State Department issued a Trafficking in Persons (TIP)
Report pursuant to the Trafficking Victims Protect Act, as amended (TVPA, Div. A of P.L. 106-
386), Vietnam has variously been designated a “Tier 2” (in 2001-2003, 2005-2009, and 2012) or a
“Tier 2 Watch List” (in 2004, 2010, and 2011) country. In the 2012 TIP report, Vietnam’s tier
ranking improved to “Tier 2,” a ranking the 2013 report maintained. Countries designated as Tier
2 do not fully comply with the minimum standards to eliminate severe forms of human
trafficking, but are making significant efforts to do so. Vietnam’s elevation to Tier 2 status in the
2012 TIP Report was due in large part to the adoption of a new law to prevent and combat human
trafficking in March 2011 and the completion of a five-year national action plan to combat human
trafficking. The new law went into effect on January 1, 2012, and included an expanded list of
prohibited trafficking-related acts. The 2013 TIP listed the government’s prosecution of “some”
labor trafficking offenses, as well as other steps, as evidence that it is making “significant efforts”
to comply with the minimum standards for eliminating trafficking.
The Vietnam Human Rights Act
Since the 107th Congress, when Members of Congress became concerned with Vietnamese
government crackdowns against protestors in the Central Highlands region, various legislative
attempts have been made to link U.S. assistance to the human rights situation in Vietnam. A
number of measures entitled “The Vietnam Human Rights Act” have been introduced, with most
proposing to cap existing non-humanitarian U.S. assistance programs to the Vietnamese
government at existing levels if the President does not certify that Vietnam is making “substantial
progress” in human rights.47

44 Among these articles are: “Impotent Labour Unions Don't Help Workers,” Thanhnien News, June 22, 2008;
“Government Units to Tackle Labour Disputes,” Vietnam Net, February 21, 2009; “Vietnam Works for Harmonious
Labour Relations,” Voice of Vietnam News, March 18, 2009; Minh Nam, “Flouting of Labor Laws Rife in HCMC:
Report,” Thanhnien News, December 2, 2008; and Minh Nam, “HCMC Officials call to Strengthen Unions, Tighten
Labor Laws,” Thanhnien News, February 12, 2009.
45 This section was written by Liana Wyler, CRS Analyst in International Crime and Narcotics.
46 State Department, 2013 Trafficking in Persons Report, p. 392-93.
47 The Vietnam Human Rights Act was first introduced in the 107th Congress as H.R. 2833, which was passed by the
House, 410-1 (roll call 335) on September 6, 2001 and did not receive action in the Senate. In the 108th Congress, H.R.
1587 and S. 2784 were introduced. House passed H.R. 1587 by a vote of 323-45 (roll call 391). In the Senate, the bill
was not reported out of committee, and attempts to include an abbreviated version in an omnibus appropriation bill did
not succeed. In the 109th Congress, another stripped-down version of the act (H.R. 3190) was included in the House-
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As introduced, the most recent version of the Vietnam Human Rights Act (H.R. 1897 in the 112th
Congress) would prohibit increases in many forms of U.S. non-humanitarian assistance to
Vietnam unless (a) Vietnam’s human rights conditions are certified as improving, or (b) the
President issues a waiver and such increases in aid are matched by increases in funding for certain
types of human rights, rule of law, and anti-jamming programs. The bill explicitly exempts
specific categories of assistance such as dioxin remediation and HIV/AIDS programs, and it
would grant the President waiver authority that allows him to exempt any programs that are
deemed to promote the goals of the act and/or to be in the national interests of the United States.
Among other items, H.R. 1897 also states that the sense of Congress is that the United States
should not reduce Vietnamese language services of the Voice of America and Radio Free Asia;
that Vietnam should be redesignated as a country of particular concern for religious freedom; and
that Vietnam’s activities to combat human trafficking are insufficient to justify its elevation to
“Tier 2” status in the State Department’s annual trafficking in persons report. The act would
require the State Department to file an annual report to Congress on various items.48
Proponents of the Vietnam Human Rights Act argue that additional pressure should be placed on
the Vietnamese government to improve its human rights record. Critics have argued that the bill
could chill the warming of bilateral political and security ties and could weaken economic
reformers in ongoing domestic political battles inside Vietnam.
Military-to-Military Ties
At the end of the previous decade, the United States and Vietnam began significantly upgrading
their military-to-military relationship, driven in large measure by Vietnam’s increased concerns
about China and enabled by over a decade of smaller, trust-building programs between the two
military bureaucracies. In August 2010, the United States and Vietnam held their inaugural
Defense Policy Dialogue, a high-level channel for direct military-to-military discussions.
Previously, the main formal vehicle for the two militaries to hold regular annual dialogues had
been through the U.S.-Vietnam Security Dialogue on Political, Security, and Defense Issues, a
forum that is run by the U.S. State Department and Vietnamese Ministry of Foreign Affairs and
includes officials from the two countries’ militaries. Other signs of a deepening military-military
relationship include U.S.-Vietnam joint naval engagements (involving noncombat training),
Vietnamese shipyards repairing U.S. noncombatant naval vessels, and the Vietnamese Ministry of
Defense sending Vietnamese officers to U.S. staff colleges and other military institutions.
In June 2012, then-Secretary of Defense Leon Panetta made a symbolic trip to the Vietnamese
shipyards at Cam Ranh Bay, which was a U.S. base during the Vietnam War. It was the first visit
to the former base by a U.S. Secretary of Defense since the end of the war. Panetta and his
counterpart, General Phung Quang Thanh, discussed ways to expand military cooperation in five

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passed version of the Foreign Relations Authorization Act of FY2006/FY2007 (H.R. 2601), which did not receive
action in the Senate. In the 110th Congress, the House passed H.R. 3096 on September 18, 2007 (414-3, roll no. 877).
The bill did not see action in the Senate. Also in the 110th, a competing version of the Vietnam Human Rights Act, S.
3678, was introduced in the Senate. In the 111th Congress, H.R. 1969 and S. 1159 were introduced by did not see
action. In the 112th Congress, the House passed by voice vote H.R. 1410, which did not see action in the Senate.
48 Unlike versions of the bill submitted in the 111th Congress (H.R. 1969 and S. 1159), H.R. 1410 contains no
authorizations to implement the bill’s provisions, nor does it prohibit Vietnam’s entry into the U.S. Generalized System
of Preferences (GSP) program.
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areas: high-level dialogues; maritime security; search-and-rescue operations; peacekeeping
operations; and humanitarian assistance and disaster relief.
As has been written by Carlyle Thayer, an expert who follows Vietnamese military matters
closely, the two militaries are working out “a program of practical activities that will enhance the
professionalism of the Vietnamese military,” including peacekeeping activities, environmental
security, multilateral search and rescue coordination and regional disaster response.49
Military Assistance
The United States and Vietnam have had an IMET agreement in place since 2005, allowing
Vietnamese officers to receive English language training in the United States. In 2007, the United
States modified International Traffic in Arms Regulations (ITAR) regarding Vietnam by allowing
licenses for trade in certain non-lethal defense items and services to Vietnam. Such transactions
are reviewed on a case-by-case basis. In FY2009, the United States provided foreign military
financing (FMF) for Vietnam for the first time. According to annual State Department reports
covering fiscal years 2007-2010, the department licensed the export of approximately $98.5
million of defense articles and $3.7 million of defense services to Vietnam during that time.
Regarding foreign military sales (FMS), according to the State Department, Vietnam has
submitted letters of request for helicopter spare parts and English language labs.50 In FY2009, the
United States extended foreign military financing (FMF) for the Vietnamese government for the
first time. According to State Department officials, “very little” of the approved FMF has been
spent, with most going toward English training labs/instructors, spare parts for helicopters, and
ship radios.51 Vietnamese leaders have asked the Obama Administration and Members of
Congress to remove U.S. restrictions on lethal weapons sales to Vietnam, and have stated that
they will not consider bilateral relations to be fully normalized until that decision is taken.52
Background
Since the United States and Vietnam normalized relations in the mid-1990s, a growing perception
of shared strategic interests has compelled and enabled the two countries’ militaries to cautiously
establish and expand ties with one another.53 Vietnamese concerns about rising Chinese power in
the region appear have made Vietnamese policy-makers, particularly civilian leaders, interested in
upgrading their security relations with the United States. However, the process of deepening
military-to-military cooperation has been slow and incremental, with the United States generally
suggesting that more be done, and the Vietnamese side responding cautiously.54

49 Carlyle A. Thayer, “Vietnam’s Defensive Diplomacy,” Wall Street Journal, August 19, 2010.
50 September 2011 e-mail correspondence with State Department officials.
51 September 2011 e-mail correspondence with State Department officials.
52 See, for instance, Department of Defense, “Joint Press Briefing with Secretary Panetta and Vietnamese Minister of
Defense Gen. Phung Quang Thanh from Hanoi, Vietnam,” June 4, 2012.
53 For more on the evolution of bilateral military ties, see Lewis M. Stern, “U.S.-Vietnam Defense Relations:
Deepening Ties, Adding Relevance,” Strategic Forum, no. 246 (September 2009).
54 Stern, “U.S.-Vietnam Defense Relations;” Carlyle A. Thayer, “Background Briefing: Vietnam’s Defence Minister
Visits Washington,” December 18, 2009, Thayer Consultancy, ABN # 65 648 097 123.
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In the 1990s, the bulk of military-to-military cooperation consisted of programs dealing with
“legacy” issues from the Vietnam War era. The two militaries developed an increasingly
cooperative relationship in locating the remains of U.S. missing servicemen.55 By the late 1990s,
a substantial permanent U.S. staff in Vietnam was deeply involved in frequent searches of aircraft
crash sites and discussions with local Vietnamese witnesses throughout the country. The U.S.
Defense Department reciprocated by allowing Vietnamese officials access to U.S. records and
maps to assist their search for Vietnamese MIAs. Additionally, the United States spent millions of
dollars annually in demining assistance in Vietnam, through the State Department’s NADR
account, which includes non-proliferation, counterterrorism, demining, and related activities. The
United States continues to fund many of these demining programs in Vietnam.
Since at least the early 2000s, the Pentagon and State Department have sought to expand and
deepen security relations and military ties with Vietnam. More than a decade later, many of these
efforts have borne fruit, albeit slowly and incrementally. An IMET agreement was signed in 2005,
followed two years later by the United States allowing sales of non-lethal defense items to
Vietnam. Additionally, U.S. naval vessels now regularly call on Vietnamese ports, and
Vietnamese military officers increasingly participate in U.S.-led conferences and academic
programs. Joint counter-narcotics training programs also have been established. The military-to-
military relationship has a developed a multilateral dimension, in part due to Vietnam’s policy of
seeking a more visible role in international organizations.
Vietnam War “Legacy” Issues
Agent Orange56
One major legacy of the Vietnam War that remains unresolved is the damage that Agent Orange,
and its accompanying dioxin, have done to the people and the environment of Vietnam. For the
last 30 years, this issue has generally been pushed to the background of bilateral discussions by
other issues considered more important by the United States and/or Vietnam. As the relationship
has improved and matured, and with most other wartime “legacy” issues presently resolved, the
issue of Agent Orange/dioxin has emerged as a regular topic in bilateral discussions.
In the last few years, the people of Vietnam and the Vietnamese government have become
increasingly concerned about the issue of Agent Orange. According to various estimates, the U.S.
military sprayed approximately 11 million-12 million gallons of Agent Orange over nearly 10%
of then-South Vietnam between 1961 and 1971. One scientific study estimated that between 2.1
million and 4.8 million Vietnamese were directly exposed to Agent Orange. Vietnamese advocacy
groups claim that there are over three million Vietnamese suffering from serious health problems
caused by exposure to the dioxin in Agent Orange.
Recently, the U.S. government has shown a greater willingness to cooperate on some aspects of
the issue. Since 2007, Congress has appropriated over $60 million for dioxin removal and health
care facilities in DaNang. However, the Vietnamese government and people would like to see the

55 Officially, more than 2,000 Americans who served in Indochina during the Vietnam War era are still unaccounted
for. Hundreds of thousands of Vietnamese remain missing.
56 For more on the Agent Orange issue, see CRS Report RL34761, Vietnamese Victims of Agent Orange and U.S.-
Vietnam Relations, by Michael F. Martin.
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United States do more to remove dioxin from their country and provide help for victims of Agent
Orange.
In June 2010, the U.S.-Vietnam Dialogue Group on Agent Orange/Dioxin (Dialogue Group), a bi-
national committee of individuals and organizations involved in this issue, released a proposed
10-year, $300 million “action plan” designed to provide “a significant part of the long-term
solution to the Agent Orange/dioxin legacy in Vietnam.”57 While the Dialogue Group does not
make specific recommendations on how to fund the plan, it does state, “the U.S. government
should play a key role in meeting these costs, along with other public and private donors,
supplementing an appropriate continuing investment from the government and the people of
Vietnam.”
POW/MIA Issues58
Since the 1990s, the annual State Department appropriations act has included language
prohibiting the use of funds to expand the United States’ diplomatic presence in Vietnam beyond
the level in effect July 11, 1995 (when the two countries opened embassies in each other’s
capitals), unless the President makes a certification that several conditions have been met
regarding Vietnam’s cooperation with the United States on Prisoner of War/Missing in Action
(POW/MIA) issues. That certification has been issued every year since the requirement was put
in place, though President Bush listed specific steps for how cooperation could be improved.
Officially, more than 1,000 Americans who served in Indochina during the Vietnam War era are
still unaccounted for.59 From 1975 through the late 1990s, obtaining a full accounting of the U.S.
POW/MIA cases was one of the dominant issues in bilateral relations. Beginning in the early
1990s, cooperation between the two sides increased. By 1998, a substantial permanent U.S. staff
in Vietnam was deeply involved in frequent searches of aircraft crash sites and discussions with
local Vietnamese witnesses throughout the country. The Vietnamese authorities also have allowed
U.S. analysts access to numerous POW/MIA-related archives and records. The U.S. Defense
Department has reciprocated by allowing Vietnamese officials access to U.S. records and maps to
assist their search for Vietnamese MIAs. The increased efforts have led to account for nearly 700
missing U.S. service personnel, though the United States continues to press Vietnam to provide
more cooperation in specific areas. During Secretary of Defense Rumsfeld’s June 2006 trip to
Vietnam, the two countries discussed expanding their cooperation on recovering remains,
including the possibility of using more advanced technology to locate, recover, and identify
remains located under water.60 Congress continues to take an interest in the POW/MIA issue.61

57 U.S.-Vietnam Dialogue Group on Agent Orange/Dioxin, “Declaration and Plan of Action: Addressing the Legacy of
Agent Orange in Vietnam,” Aspen Institute, June 2010.
58 For more on the POW/MIA issue, see CRS Report RL33452, POWs and MIAs: Status and Accounting Issues, by
Charles A. Henning.
59 Official U.S. policy does not remove a name from the rolls of those unaccounted for unless remains are identified.
60 Office of the Assistant Secretary of Defense (Public Affairs), “Press Availability with Secretary Rumsfeld in
Vietnam,” June 5, 2006.
61 For instance, in February 2009, H.Res. 111 (King, R-NY) was introduced. It would establish a Select Committee on
POW and MIA Affairs to conduct a full investigation of all unresolved matters relating to any United States personnel
unaccounted for from the Vietnam War and several other conflicts. In the 110th Congress, on July 10, 2008, the House
Armed Service Subcommittee on Military Personnel held a hearing on oversight and the status of POW/MIA activities.
Additionally, in May 2008, the House passed H.Res. 986 (roll no. 366), stating that the House “will not forget” and
“will continue to press for a full accounting of” U.S. military and civilian personnel who remain unaccounted for from
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Hundreds of thousands of Vietnamese remain missing from the Vietnam War period. For years,
Vietnam has expressed in interest in receiving U.S. help in locating and identifying the remains of
these MIAs. In November 2010, the U.S. Agency for International Development (USAID) and
Vietnam’s Ministry of Labor and Social Affairs (MOLISA) agreed to a two-year program under
which the United States will spend $1 million to help Vietnam locate and recover the remains of
the hundreds of thousands of Vietnamese soldiers missing from the Vietnam War.62
Conditions in Vietnam
For the first decade after reunification in 1975, Vietnamese leaders placed a high priority on
ideological purity and rigid government controls. By the mid-1980s, disastrous economic
conditions and diplomatic isolation led the country to adopt a more pragmatic line, enshrined in
the doi moi (renovation) economic reforms of 1986. Under doi moi, the government gave farmers
greater control over what they produce, abandoned many aspects of central state planning, cut
subsidies to state enterprises, reformed the price system, and opened the country to foreign direct
investment (FDI). After stalling somewhat in the late 1990s, economic reforms were accelerated
in the early 2000s, as Vietnam made sweeping changes that were necessary to enter the WTO.
Politically and socially, the country became much less repressive, even tolerating some
expressions of dissent in certain areas that had been considered sensitive. That said, although
Vietnam appears to be a freer country than it was two decades ago, according to many sources
human rights conditions have worsened compared to the middle of the last decade, particularly
for dissenters. There are numerous signs that factional battles among Vietnamese leaders have
intensified since at least 2011. Prime Minister Nguyen Tan Dung, who has held his post since
2006, has come under increasing criticism for allegations of corruption of his allies and for an
array of nationwide economic problems. Vietnamese leaders currently are in the process of
revising the country’s constitution.
Economic Developments
Vietnam’s Economic Troubles of 2007-2011
Since late 2007, Vietnam’s economy has been buffeted by economic difficulties that have
increased social strife and raised concerns about the country’s economic stability. In 2007 and the
first half of 2008, the country experienced first soaring inflation and then acute, downward
pressure on the country’s currency, the dong. The problems caused by inflation were particularly
onerous, as the prices of some food items rose by over 50%, leading workers in a number of
factories to go on strike demanding higher wages. By late 2008, the rapid increase in the inflation
rate had halted, allowing the government to shift its priority to spurring growth as the global
financial crisis’s effects began to hit Vietnam.
Although restrictions on international financial transactions limited Vietnam’s direct exposure to
the global financial and credit crises, the secondary effects created new pressures on Vietnam,

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the Vietnam conflict.
62 US Embassy Hanoi, “The U.S. Provides $1 Million in Technical Assistance to Help Vietnam Locate and Identify
Soldiers Missing in Action,” November 19, 2010.
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which is heavily dependent on trade and foreign direct investment inflows. In response to the
crisis, Hanoi lowered corporate tax rates, cut interest rates, allowed the dong to depreciate against
the U.S. dollar, and unveiled a stimulus package that the International Monetary Fund estimated
to be worth roughly $4 billion. Some selected figures illustrate Vietnam’s vulnerability to the
global slowdown and collapse in commodity prices: exports are equivalent to 80% of GDP; about
60% of Vietnamese exports go to the United States, the European Union, and Japan; and oil
revenue accounts for 30% of the government’s revenue.63 In 2009, Vietnam’s exports fell by
around 10% compared with 2008 levels, and its imports decreased by around 13%. However, like
many Asian developing countries, Vietnam’s economy avoided some of the harsher effects of the
slowdown. Real GDP growth for 2009 was 5.3% and 6.8% for 2010. The Vietnamese government
estimates that the economy grew by around 5.9% in 2011.64
Nonetheless, GDP growth of 7% is a key threshold in the minds of many Vietnamese
policymakers for creating the jobs necessary for the VCP and the government to maintain social
stability. Thus, compared to the 8% growth rates Vietnam experienced for much of the 2000s, the
2008-2011 period likely has felt like a recession to many in Vietnam. Compounding the challenge
of whether to prioritize spurring growth or fighting inflation prices are signs that the latter is
recurring; Vietnam’s consumer price index rose by over 18% in 2011.65
Background
During the 25 years since the doi moi reforms were launched, Vietnam was one of the world’s
fastest-growing countries. Agricultural production has soared, transforming Vietnam from a net
food importer into the world’s second-largest exporter of rice and the second-largest producer of
coffee. The move away from a command economy also helped reduce poverty levels from 58%
of the population in 1992 to less than 15% two decades later, and the government has set a goal of
becoming a middle-income country by 2020. A substantial portion of the country’s growth has
been driven by foreign investment.
After years of annual growth rates above 7%, Vietnam’s economic growth has slowed
considerably following the global financial crisis of 2007. Vietnam’s real GDP grew by just over
5% in 2012 and its inflation rate was nearly 7%, significantly lower than the double-digit price
increases of the previous two years. Vietnam has also seen a rising income and wealth disparity,
that at times has fueled discontent among Vietnam’s poor and lower-income population.
Vietnam remains a poor country; the World Bank in 2005 estimated that about one-third of
Vietnamese children under five years of age suffered from malnutrition.66 Per capita GDP in 2012
was under $4,000 when measured on a purchasing power parity basis.67 Economists point to
Vietnam’s failure to tackle its remaining structural economic problems—including unprofitable
state-owned enterprises (SOEs), a weak banking sector, massive red tape, and bureaucratic
corruption—as major impediments to continued growth. According to some sources, many if not
most of Vietnam’s SOEs are functionally bankrupt, and require significant government subsidies

63 Economist Intelligence Unit, Vietnam Country Report, May 2008.
64 General Statistics Office of Vietnam Press Release, “Socio-Economic Statistics for 2011,” December 30, 2011.
65 General Statistics Office of Vietnam Press Release, “Socio-Economic Statistics for 2011,” December 30, 2011.
66 World Bank, “Vietnam at a Glance,” September 12, 2005.
67 Central Intelligence Agency, World Factbook, June 10, 2013.
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and assistance to continue operating. Although more than 2,500 SOEs officially have been
partially privatized since 1990 under the government’s “equitization” program, most of these are
small and medium-sized firms, and the government still owns substantial stakes in them. Other
SOE reform measures are being discussed.
Vietnam’s Politics and Political Structure
In general, Vietnam’s experiments with political reform have lagged behind its economic
changes. A new constitution promulgated in 1992, for instance, reaffirmed the central role of the
VCP in politics and society, and Vietnam remains a one-party state. In practice, the Communist
Party sets the general direction for policy while the details of implementation generally are left to
the four lesser pillars of the Vietnamese polity: the state bureaucracy, the legislature (the National
Assembly), the Vietnamese People’s Army (VPA), and the officially sanctioned associations and
organizations that exist under the Vietnamese Fatherland Front umbrella.
The Party’s major decision-making bodies are the Central Committee, which has 175 members,
and the Politburo, which has 14 members. Membership on the Politburo generally is decided
based upon maintaining a rough geographic (north, south, and central) and factional
(conservatives and reformers) balance. The three top leadership posts are, in order of influence,
the VCP general secretary, followed by the prime minister, and the president. Since the death in
1986 of Vietnam’s last “strong man,” Le Duan, decision-making on major policy issues typically
has been arrived at through consensus within the Politburo, a practice that often leads to
protracted delays on contentious issues.
Leadership Team Selected at the 11th Party Congress
In mid-January 2011, the ruling Vietnamese Communist Party (VCP) held a weeklong National
Congress, the 11th since the Party was founded. Party Congresses, held every five years, are often
occasions for major leadership realignments and set the direction for Vietnam’s economic,
diplomatic, and social policies.
At the 11th Party Congress, delegates selected Nguyen Phu Trong (66 years old), formerly the
chairman of Vietnam’s National Assembly, to serve as the next VCP general secretary, Vietnam’s
top post. Prime Minister Nguyen Tan Dung (61, pronounced “zung”) retained his membership in
the 14-member Politburo, a move that virtually ensured that the National Assembly would
reappoint him when it convened later in 2011. Likewise, the Assembly approved the Party
Congress’ decision select Truong Tan Sang (61) as Vietnam’s next president.68 Dung and Sang are
both believed to have sought to become general secretary. Vietnam’s foreign minister, Pham Gia
Khiem, was not re-elected to the Party’s Central Committee, which means that he will likely step
down at or before the National Assembly’s summer session.
Many Western analysts regard Vietnam’s ruling triumvirate as pragmatic and in favor of
continuing steady, incremental improvements in relations with the United States. The Party
Congress also is believed to have endorsed continuity in Vietnam’s economic policy, particularly
the pursuit of a high GDP growth strategy, and strong support for state-owned enterprises, which

68 The former president and VCP general secretary had both served two, five-year terms, and—in keeping with recent
tradition—had stepped down for age and health reasons.
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are to be reformed and restructured in order that they can be more competitive in a market
socialist economy.69 There appears to have been a near-consensus that Vietnam should continue to
pursue its goal of become a “modernity-oriented industrialized nation by 2020,” as articulated by
General Secretary Trong in his closing remarks to the Congress.70
Throughout 2010, there were rumors that Prime Minister Dung, who has served since 2006,
would be replaced at the Congress, particularly because of his connection to the financially
troubled state-owned enterprise, Vinashin, and public outcries against his plans to allow Chinese
and other mining companies to dramatically expand bauxite mines in the country’s Central
Highlands region. Despite his apparent re-appointment, Dung’s power base is believed to have
been reduced at the Congress. Trong and Sang are both believed to be assertive rivals and battles
between them and Dung appear to have intensified in 2012.
The National Assembly71
Over the past 10 years, Vietnam’s legislative organ, the National Assembly, has slowly and subtly
increased its influence to the point where it is no longer a rubber stamp. In recent years the
Assembly has vetoed Cabinet appointments, forced the government to revise major commercial
legislation, and successfully demanded an increase in its powers. These include the right to
review each line of the government’s budget, the right to hold no-confidence votes against the
government, and the right to dismiss the president and prime minister (though not the VCP
general secretary).
During its 7th session held in June 2010, the National Assembly amended several bills introduced
by various Ministries (including a controversial law on mining), and questioned the merits of
plans to build a high-speed passenger rail line from Hanoi to Ho Chi Minh City. On June 19,
2010, the Vietnamese National Assembly (VNA) voted to reject a resolution to build a high speed
rail connecting Hanoi and Ho Chi Minh City. It is unclear whether this represented an exercise in
power by an increasingly independent National Assembly or whether it was a public expression
resulting from internal political maneuverings between the conservative and reformist elements
within the Vietnamese Communist Party.
It remains to be seen how much influence the Assembly will ultimately have over policymaking,
given the VCP’s dominant role and the centralization of decision-making in Vietnam. More than
85% of parliamentarians are Party members, and the VCP carefully screens all candidates before
elections are held. Moreover, the Communist Party and the central government generally have
encouraged the National Assembly’s evolution into a more robust body, to help create the legal
system and culture most Vietnamese leaders feel are necessary to support a modern, middle-
income state. The latest elections for National Assembly members were held in May 2011.

69 For instance, in a January 2011 article, Dung stated that the state sector, including state-owned enterprises, play “the
leading role” in the economy. Nguyen Tan Dung, “PM Highlights Development Strategy for 2011-2020,” Vietnam
News Agency Online, January 3, 2011.
70 Vietnamese News Agency, “Closing Speech by New Party General Secretary,” January 19, 2011.
71 CRS Research Associate Lam Van Phan contributed to this section.
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Sino-Vietnam Relations
Since the late 1990s, when China began espousing its “new security concept” of cooperation with
its neighbors, improvements in Sino-Vietnamese relations have accelerated, most notably with the
signings of a land border treaty in 1999 and a sea border treaty for the Gulf of Tonkin in 2000.
For Vietnamese leaders, this process has been fraught with ambivalence. On the one hand,
maintaining stable, friendly relations with its northern neighbor is critical for Vietnam’s economic
development and security, and Hanoi does not undertake large-scale diplomatic moves without
first calculating Beijing’s likely reaction. China’s ruling Communist Party is an ideological
bedfellow, as well as a role model for a country that seeks to allow more market forces into its
economy without threatening the Communist Party’s dominance. China also is Vietnam’s largest
trading partner. Imports from China have soared over the past decade, as the two countries’
infrastructures have become increasingly intertwined. Power plants in southeastern China, for
instance, provide electricity for parts of northern Vietnam. Many of Prime Minister Nguyen Van
Dung’s economic policies have relied on Chinese economic support, including investments in
Vietnamese natural resources.
On the other hand, many Vietnamese are wary of China’s increased influence in Southeast Asia.
Vietnam and China still have overlapping claims to the Spratly Island chain and the Paracel
Islands in the South China Sea, differences that led to military clashes in the late 1980s. Tensions
over the conflicting claims have increased since the middle part of the last decade. Like other
countries in the dispute, Vietnam has continued to expand its presence in the island chain. In
moves widely interpreted as related to increased tensions in the South China Sea, Vietnam in
2009 reportedly signed contracts to purchase billions of dollars of new military equipment from
Russia, including six Kilo-class submarines. According to Vietnam’s most recent Defense
Ministry White paper, released in 2009, Vietnam’s defense budget increased by nearly 70%
between 2005 and 2008.72
Since at least early 2010, Vietnam’s strategy has been to try to internationalize its South China
disputes with China, both by encouraging outside powers (particularly the United States) to raise
the issue with China and by pressuring China to enter multilateral talks with the other disputants,
if not with ASEAN as a whole. China’s preferred approach is to deal with the disputes bilaterally
and separately with each country that disputes its claims. One factor influencing leaders in Hanoi
is a significant anti-Chinese constituency inside Vietnam. Although the South China Sea disputes
have continued to flare, and in some cases worsen, over the past three years, Hanoi and Beijing
also have continued to expand their diplomatic and party-to-party ties and appear to be seeking
ways to prevent their maritime disputes from spilling over into other areas of the relationship.
Economically, Vietnamese see China as both an economic partner and rival. Both countries
compete for foreign direct investment and for markets in many of the same low-cost
manufacturing products, such as clothing. Vietnamese leaders periodically express concern about
Vietnam’s rising trade deficit with China, which was around $13 billion in 2011. In 2011, Chinese
imports represented nearly a quarter of Vietnam’s total imports by value, up from 9% in 2000.
China’s relative importance as an export market for Vietnamese goods and services over the same

72 Vietnam, Ministry of Defense, White Paper, 2009, p. 38.
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period remained essentially unchanged, at around 10% of Vietnam’s exports by value.73 Many
Vietnamese worry that China is increasing its economic influence over and within Vietnam.
The Environment
In climate modeling exercises, Vietnam is often listed as one of the world’s most vulnerable
countries to the possible effects of climate change, due among other factors to its climate, long
coastline, and topography (particularly the extent of low-lying coastal areas with high population
concentrations). Rising sea levels, increased frequency and intensity of storms, as well as drought
and salt-water intrusion could have a severe impact on the country, particularly its poorer
communities. Additionally, the flow of the Mekong River, which reaches its terminus in Vietnam,
is being affected by the extensive damming of the river’s upper reaches. In China, four dams have
been built along the Lancang (as the Mekong is called in China) and four more are planned. Nine
additional dams along the Mekong are planned in Laos and two in Cambodia.
For a number of reasons, Vietnam is considered ripe for developing projects to adapt to
anticipated climatic changes. Many organs of the Vietnamese government appear to have
recognized and gathered data on the problems that could arise from climate change, and Vietnam
has reached out to the international community for advice and assistance. According to
information provided by the U.S. Agency for International Development, the United States has
spent over $25 million since 2008 for bilateral environmental programs, including those directly
related to climate change issues. Despite the steps Vietnam has taken, it is not clear to what extent
the country has reconciled expected environmental changes with its overriding domestic priority:
achieving its goal of becoming a middle-income economy by 2020.
Selected Legislation in the 113th Congress
H.R. 772 (Faleomavaega). States that the United States has an interest in ensuring that “no party
threatens or uses force or coercion unilaterally to assert maritime territorial claims in East Asia
and Southeast Asia, including in the South China Sea.... ” Condemns Chinese vessels’ “use of
threats or force” in the South China Sea and the East China Sea. Supports U.S. military
operations to uphold freedom of navigation rights in the waters and air space of the South China
Sea and East China Sea. Requires the Secretary of State to submit to Congress a report on the
negotiations over a Code of Conduct in the South China Sea. Introduced February 15, 2013;
referred to House Subcommittee on Asia and the Pacific.
H.R. 1897 (Smith). Vietnam Human Rights Act of 2013. Prohibits increases in many forms of
U.S. non-humanitarian assistance to Vietnam unless (a) Vietnam’s human rights conditions are
certified as improving, or (b) the President issues a waiver and such increases in aid are matched
by increases in funding for certain types of human rights, rule of law, and anti-jamming programs.
States that the sense of Congress is that the United States should not reduce Vietnamese language
services of the Voice of America and Radio Free Asia; that Vietnam should be redesignated as a
country of particular concern for religious freedom; and that Vietnam’s activities to combat
human trafficking are insufficient to justify its elevation to “Tier 2” status in the State
Department’s annual trafficking in persons report. Requires the Secretary of State to submit an

73 General Statistics Office of Vietnam.
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annual report to Congress on various matters. Introduced May 8, 2013; referred to House
Subcommittee on Asia and the Pacific.
H.Res. 218 (Royce). “Encourages” the State Department to redesignate Vietnam as a country of
particular concern for “particularly severe violations of religious freedom.” “Urges” the State
Department to demonstrate that the expansion of U.S.-Vietnam relations will depend on
improvements in religious freedom in Vietnam. Introduced May 16, 2013; referred to the House
Subcommittee on Asia and the Pacific.
S. 929 (Cornyn). The Vietnam Human Rights Sanctions Act. Requires the President to (a)
compile and submit to Congress a list of Vietnamese deemed to be complicit in human rights
abuses, (b) prohibit these individuals from entering the United States, and (c) impose financial
sanctions on these individuals. Authorizes the President to waive sanctions to comply with
international agreements or if in the U.S. national interest. Expresses the sense of Congress that
the Secretary of State should designate Vietnam as a country of particular concern (CPC) with
respect to religious freedom, and that bilateral relations cannot expand unless Vietnam’s human
rights conditions improve. Introduced May 9, 2013; referred to the Senate Committee on Foreign
Relations.
S.Res. 167 (Menendez). States that the United States has an interest in freedom of navigation and
overflight in Asia-Pacific maritime domains. “Condemns” maritime vessels’ and aircrafts’ use of
coercion, threats, or force in the South China Sea and East China Sea to assert disputed maritime
or territorial claims or alter the status quo. “Supports” ASEAN and China’s efforts to develop of a
Code of Conduct for the South China Sea. “Supports” U.S. military operations in the Western
Pacific, including in partnership with other countries, to support the freedom of navigation.
Introduced June 10, 2013; referred to Senate Committee on Foreign Relations.
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U.S.-Vietnam Relations in 2013: Current Issues and Implications for U.S. Policy

Figure 1. Map of Vietnam

Source: CRS.
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Author Contact Information

Mark E. Manyin

Specialist in Asian Affairs
mmanyin@crs.loc.gov, 7-7653


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