United States-Vietnam Bilateral Trade Agreement Update

February 2001

On Thursday, July 13, 2000, U.S. Trade Representative Charlene Barshefsky and Vietnam's Trade Minister Vu Khoan signed a bilateral trade agreement in Washington. To view Barnes, Richardson & Colburn's original notice discussing this agreement, click here. Sources now indicate that the Bush Administration is unlikely to transmit the agreement to Congress until after the Senate confirms the nomination of Robert Zoellick as United States Trade Representative ("USTR"). Mr. Zoellick's confirmation is currently expected to be in early February 2001.

Readers should note that Senator John Kerry (D- MA) inquired regarding the Administration's intentions as to the submission of the agreement during Mr. Zoellick's testimony before the Senate Finance Committee on January 30, 2001. At that time Senator Kerry urged an early submission this session, before Congress became engrossed in other legislation. Mr. Zoellick did not specify the Administration's intention on this matter. To view Mr. Zoellick's prepared testimony before the Finance Committee, please click here.

Transmission of the agreement to Congress will trigger a procedure under which (1) a single joint resolution of Congress will be introduced approving both the agreement and the extension of normal trade relations to Vietnam, and (2) Congress will act on the agreement and resolution within 90 session days of transmission. After Congress passes this resolution, the President would be able to extend normal trade relations to Vietnam by proclamation. In addition, it appears that Congress intends to coordinate the passage of the agreement and an approval resolution with an extension, if the President grants it, of Vietnam's waiver from the Jackson-Varnik emigration requirements. Extension of the Jackson-Varnik waiver, along with the passage of the agreement are necessary for Vietnam to receive permanent normal trade relation treatment from the United States. Vietnam's current Jackson-Varnik waiver expires July 2, 2001, so action would apparently need to take place before then.

Finally, it appears that there are two major trade issues which have not been resolved concerning this agreement. Sources indicate that the first of these, negotiation of a United States-Vietnam textile agreement establishing quotas for textile and apparel exported by Vietnam is unlikely to jeopardize eventual passage of the agreement. However, the second issue, the rapid growth in exports of Vietnamese catfish to the United States, and the possible threat these exports represent to the United States catfish industry may need to be resolved before the agreement could be ratified. It appears that negotiations regarding these points will be ongoing. Please see this space for future updates.

This item was prepared, in part, with information from International Trade Today's Power Broker, February 1, 2001 edition.