Statement of Greig Craft, President, Craft Corporation;
Vice Chairman, Asia-Pacific Council of American Chambers, Hanoi, Vietnam;
and Member, Board of Governors, American Chamber of Commerce in Hanoi

Testimony Before the Subcommittee on Trade
of the House Committee on Ways and Means

Hearing on United States-Vietnam Trade Relations

June 17, 1999

Mr. Chairman and committee members - good morning. My name is Greig Craft. In my capacity as Vice Chairman of APCAC (Asia-Pacific Council of American Chamber) I am honored to be here today to share our position on extension of Jackson-Vanik, as well as to provide you first hand observations as a result of several years of residency in Hanoi. First, let me state unequivocally that all American business people in Vietnam share the fullest possible accounting of American servicemen missing from the war. Second, all American business people have an interest in promoting freedom of emigration, which the Government of Vietnam has made significant progress. Lastly, in addition to pursuing commercial opportunities, we all have an ongoing interest to promote human rights and democratic freedom throughout the world. The process of economic development bodes well for eventual political liberalization in Vietnam as well.

Despite our turbulent past, the United States and Vietnam have made significant progress toward normalization of relations. Ordinary citizens show much goodwill toward Americans living in Vietnam and there are many humanitarian programs being carried out by people of both countries. Tens of thousands of Vietnamese-Americans have returned to Vietnam to visit and work. They are eager and enthusiastic to contribute to Vietnam's modernization. Taking advantage of opportunities in Vietnam will help sustain, and indeed, increase, job opportunities for American workers involved in the manufacture and export of American products to Asia. And equally important, it will help once and for all to ease the pain and divisiveness that have troubled our national psyche for 25 years. It is time to continue building a new relationship with Vietnam, and time to move on to a new era of peace and forgiveness. Constructive engagement by the US Government towards Vietnam is a policy which should continue in our national interest.

The members of APCAC represent more than 40,000 businessmen and women, and more than 6,600 companies in 18 Asia-Pacific countries, including Vietnam. Our membership manages trade volumes in excess of $200 billion and investments of over $50 billion in the region. We serve American's national interests by fuelling the growth of American jobs and exports which have contributed so significantly to America's economic success in recent years. It is our position that Vietnam, with its young and well educated population of nearly 80 million, offers significant opportunities to help sustain this economic growth, provided American companies can remain competitive there through access to essential US government programs such as EXIM, OPIC and TDA. American companies operating in Vietnam have invested over $1.2 billion to date, with an additional $2 billion in advanced stages of development. This is impressive, coming after only 4 years since the President announced "normalization of relations" with Vietnam. But this could increase substantially if full normalization was in place.

There has been significant and notable progress in recent years. Vietnam has the second largest population in SE Asia and the opportunities for US manufacturers are immense. Well know American brands are already market leaders in many instances. Access to television programming such as MTV, CNN and NBC only adds to this consumer brand awareness. Vietnam's strategic location on China's southern border cannot be overlooked - this makes it of pivotal political importance to the United States as well. Vietnam's desire to join the world community is evidenced by it's entry into ASEAN and APEC, and preparations to join the WTO. However, as a part of its globalization initiative Vietnam want and needs to fully normalize relations with the United States. It is in the national interest of the United States to maintain a fully normalized economic and political relationship with Vietnam. If further developed, it will not only help sustain economic growth in America, but equally important, will provide stability in the region. We in the business community can help further this process, and ultimate healing, but only if we have the ability to remain engaged in Vietnam on a day to day basis. This means we must be able to compete equally with foreign companies who enjoy sovereign financing and support from their respective governments. Continuation of the Jackson-Vanik waiver is therefore essential to maintain ongoing American involvement in Vietnam, for the benefit of American enterprises.

On a personal note, since 1995 our company Craft Corporation, have led the development of Vietnam's first Direct Reduced Iron plant - a $300 million project which will be the first American involvement in Vietnam's emerging steel industry. It will create a valuable feedstock required even by our own steel producers in the US. Our American led consortium, including involvement of US companies such as Raytheon and Midrex, will utilize US technology, US services, and US equipment in the implementation of this strategically important project. We were awarded the first TDA grant to Vietnam in 1997 and have submitted an application to OPIC for financing and insurance. However, without access to these government programs there would be no alternative but to turn to foreign financial sources, foreign equipment and ultimately foreign ownership.

Denial of the programs available with the Jackson-Vanik extension will only force Vietnam to go to other countries for their investment, raw materials and trade. Denial of these programs becomes a form of unilateral sanctions which in the end hurts everyone, both Vietnamese and American. This should not be our policy. Last year I testified before this committee and stated "denying the Jackson-Vanik waiver extension is the wrong action at the wrong time". Today I say to you: Extending Jackson-Vanik waiver is the right action at the right time.

Thank you for considering our views.