News-Info-Alerts

To: ALL

From: Andi Wolos & Bob Necci
(POW-MIA InterNetwork)

Re: Understanding Jackson-Vanik

Date: May 11, 1998

The Jackson-Vanik Amendment:
Normalization of Commercial Relations with Vietnam
and The POW/MIA Road Map
By AII POW-MIA

UNDERSTANDING JACKSON-VANIK

The Jackson-Vanik amendment (Section 402, Title IV, Trade Act of 1974; 19 U.S.C. 2432) is the pivotal element of the normalization of U.S. commercial relations with Vietnam. This amendment allows for emerging market economies to be eligible for most-favored-nation status in trade with the United States. It also allows access to federal financial facilities based on compliance with free-emigration requirements as imposed by Jackson-Vanik (J-V).

In its essence, J-V prohibits the restoration of certain commercial relations with countries that engage in practices enjoining or severely restricting free emigration of its citizens and precisely identifies such practices as: (1) abnegating from its citizens the right or opportunity to emigrate, (2) imposing more than a nominal tax on emigration or documents required for emigration, (3) imposing more than a nominal tax or charge on a citizen as a consequence of desire to emigrate to the country of choice.

The President by Executive action has two options available to him. He may report to Congress, semiannually, that the listed country no longer engages in restricted practices or he may determine that a waiver of prohibition will substantially promote the objectives of J-V based on having received the country's assurances that its emigration polices will lead to substantial progress in implementing those objectives. This is an annually renewable waiver.

These waivers under Presidential authority must be extended annually or they expire on July 3rd. The extension is automatic if the President renews it by June 3rd. The Congress may disapprove it in its entirety or with respect to individual countries by a joint resolution of Congress adopted by August 30th.

There also exists the requirement of a bilateral trade agreement which must be approved and implemented by a joint resolution of Congress before the applicability of restoration of relations is concluded.

UNITED STATES-VIETNAM RELATIONS SINCE 1975

Essentially, U.S.-Vietnam diplomatic and economic relations remained paralyzed for over a decade beginning in 1975 with the communist victory over Saigon in April 1975 wherein the United States ended diplomatic relations with Saigon and subjected all relations with South Vietnam to the same restrictions that already applied to North Vietnam. The principal restrictions included a nearly total embargo on all commercial and financial transactions with Vietnam, and a blocking of all Vietnamese assets in the United States.

Following the signing of the Paris Peace Accords, the Hanoi government called upon the U.S. to begin discussions on establishing diplomatic relations and demanded the U.S. fulfill pledged U.S. postwar aid for Vietnam's reconstruction. These demands were rejected by the Ford Administration who would not proceed without a full accounting of American POW/MIAs and a clearer vision of Vietnam's long-range intentions in Southeast Asia.

The Carter Administration began policy initiatives to improve relations, but these efforts were frustrated by growing evidence that the Vietnamese government was deliberately expelling hundred of thousands of its citizens and was making military preparation for the invasion of Cambodia. In July 1977, the U.S. proposed that diplomatic relations be quickly established. This was flatly rejected by the Vietnamese, nor would they provide information on U.S. POW/MIAs until the U.S. would provide several billion dollars in postwar reconstructive aid. They later modified this position and furnished limited information on MIAs. Obviously, U.S. aid was not forthcoming.

DEVELOPMENTS DURING THE REAGAN AND BUSH ADMINISTRATIONS

The Reagan Administration opposed normal relations with Hanoi until there was a verified withdrawal of Vietnamese forces from Cambodia and later modified to include a comprehensive settlement. The Administration also noted that normalizing relations would remain difficult until Vietnam cooperated in obtaining the fullest possible accounting of U.S. personnel listed as POW/MIA.

Following the Presidential delegation in 1987, Vietnam began returning hundreds of sets of remains. Controversy over U.S. government handling of the POW/MIA issue prompted the Senate to initiate a special committee to investigative this question. In 1991, the U.S. welcomed Vietnam's willingness to host a U.S. office in Hanoi to handle POW/MIA affairs and later eased travel restrictions on Vietnamese diplomats entering the U.S.

In April 1991, the U.S. laid out a detailed "road map" for normalization with Vietnam. Phase I began with the October 1991 signing of peace agreement on Cambodia.

Vietnam is to:

Sign the Cambodian peace accord and help to persuade the Phnom Penh regime to sign
Take needed steps to resolve quickly "last known alive" POW Discrepancy cases, live sighting reports, and return American remains with an eye toward settling the POW/MIA cases in Indochina in 2 years
Allow those Vietnamese detainees previously affiliated with the U.S. to exit by means of the Orderly Departure Program

United States is to:

Lift 25-mile travel ban on Vietnamese diplomats in New York
Begin bilateral talks on normalizing diplomatic relations
Permit U.S. organized travel to Vietnam
Liberalize U.S. economic relations with Cambodia
State publicly U.S. official concerns regarding genocide in Cambodia

Phase II begins after Phase I and once U.N. peacekeepers are well established in Cambodia.

Vietnam is to:

Continue to support Paris agreement and help persuade Phnom Penh to continue to support it
Continue progress on POW/MIA issues begun in Phase I

United States is to:

Send high-level delegation to Hanoi for talks on normalization of relations
Allow U.S. telecommunications links with Vietnam
Allow signing of U.S. contracts with Vietnam
Allow U.S. commercial transactions meeting basic human needs in Vietnam
Work with others to help Vietnam eliminate arrears to international financial institutions
Allow U.S. firms to open commercial offices in Vietnam
Lift all restrictions on U.S. non-governmental organization projects in Vietnam

Phase III begins once U.N. procedures and Cambodian settlement process are well in place.

Vietnam is to:
Continue its support and encourage Phnom Penh's support of Cambodia peace agreementWithdraw all Vietnamese forces/military advisers from CambodiaResolve last known alive discrepancy cases and repatriate U.S. remains readily available to Vietnam

United States is to:
Open diplomatic liaison office in Hanoi and invite Vietnam to establish one in Washington
Fully lift trade embargo
Support International Financial Institutions aid meeting basic human needs in Vietnam

Phase IV begins once a U.N.-certified free election takes place in Cambodia;
a Cambodian National Assembly is formed and is writing a new constitution;
demobilization of factional forces specified in the 1991 accord has occurred;
and the objectives of the U.S.-Vietnam 2-year effort to resolve POW/MIA issues have been achieved.

Vietnam is to:
[No additional requirements at this stage.]

United States is to:
Establish ambassadorial-diplomatic relations with Vietnam
Consider granting most-favored-nation status to Vietnamese trade
Favorably consider International Financial Institutions assistance for non-basic human needs projects in Vietnam

DEVELOPMENTS DURING THE CLINTON ADMINISTRATION

The Clinton Administration has moved incrementally to establish more normal U.S. economic, consular, diplomatic and other official relations with Vietnam.

Chronology:

July 2, 1993 - Clinton announces U.S. no longer opposes international financial institution aid to Vietnam

September 13, 1993 - Clinton renews authority to maintain U.S. trade embargo on Vietnam

December 15, 1993 - Clinton eases embargo by allowing U.S. companies to bid on development projects

January 27, 1994 - Senate votes urging lifting of trade embargo

February 3, 1994 - Trade Embargo lifted

May 26, 1994 - U.S. and Vietnam announce that official liaison offices would be established

August 10, 1994 - Congress passed H.R. 4425, which lifted legal restrictions on aid to Vietnam

January 28, 1995 - Bilateral diplomatic and private property claims settled

February 1,1995 - Vietnam opens consular level liaison office in Washington

February 3, 1995 - United States opens consular level liaison office in Hanoi

March 9, 1995 - Treasury Department unblocks accounts in which Vietnam or its nationals had an interest

July 11, 1995 - Clinton announces his decision to establish ambassadorial level relations with Vietnam

August 6, 1995 - Secretary of State Christopher opens U.S. Embassy in Vietnam

May 23, 1996 - Clinton nominates Peterson as ambassador to Vietnam

May 30, 1996 - Clinton certifies the Vietnam government was fully cooperating with the United States

January 1, 1997 - The Clinton Administration formally nominates Peterson as ambassador to Vietnam

February 13, 1997 - Peterson's confirmation hearing

March 4, 1997 - Peterson's nomination passes Senate Foreign Relations Committee

April 10, 1997 - Peterson confirmed as U.S. Ambassador to Vietnam

May 14, 1997 - Peterson presents ambassadorial credentials to Vice President Nguyen Thi Binh

May 21, 1997 - Le Van Bang presents ambassadorial credentials to President Clinton

March 4, 1998 - Clinton certifies Vietnam is "fully cooperating in good faith"

March 11, 1998 - Clinton signs waiver granting exemption of the Jackson-Vanik amendment for Vietnam

THE CERTIFICATION

On March 4, 1998, President Clinton certified that Vietnam is "fully cooperating in good faith." This certification was the last remaining step to the Executive option of granting the J-V exemption waiver for Vietnam.

We believe this certification was premature.

On February 25, 1998, in a letter responding to concerns on Vietnam's cooperation on the POW/MIA issue and the J-V exemption waiver, President Clinton wrote: " . . . the intelligence community is preparing a National Intelligence Estimate regarding the extent of Vietnam's disclosure of information on our missing service personnel. The results of that estimate will be taken into account as we continue to advance our agenda with Vietnam on all issues, including emigration and human rights."

Yet on March 4, 1998, in a Memorandum For The Secretary Of State, President Clinton stated: "I hereby determine, based on all information available to the United States Government, that the Government of the Socialist Republic of Vietnam is fully cooperating in good faith with the United States . . ."

The record is very clear. The President made his determination without benefit of the conclusions of the National Intelligence Estimate (NIE) which was ongoing, an Estimate he stated would ". . . be taken into account . . ."

This presidential action is very troubling.

The President makes a certification and determination on Vietnamese cooperation, the very scope and purpose for which the NIE was initiated, and yet does not wait for the final report of this Estimate (with a tentative completion date of March 30, 1998.)

If the President had received a preliminary report on the NIE, which bolstered his resolve, surely he would have publicly used it to support his determination and certification. If the NIE does not support the President'saction, pre-empting its release with his "fast-track" agenda on increased normalization with Vietnam lessens the impact of the NIE conclusions.

WHERE DO WE GO FROM HERE?

If the findings of the NIE conclude that Vietnam is indeed "fully cooperating in good faith," then continued opposition to the President's action would be without merit. If the President's actions are not supported by the NIE, then our only alternative is to press our case with Congress.