Vietnam’s American Prisoners

  The Wall Street Journal

December 6, 2007

 

REVIEW & OUTLOOK
   

Vietnam’s American Prisoners
December 6, 2007

Vietnam has been working hard to improve its relationship with the U.S. Yet just eight months ago, Hanoi undermined that effort by imprisoning a human-rights activist with ties to the U.S. Now it is repeating the same mistake.

On Nov. 17, Communist authorities in Ho Chi Minh City broke up a small, peaceful meeting of democracy activists held in a private home. Among those arrested were Nguyen Quoc Quan and Leon Truong, both American citizens. Mr. Nguyen was born in Vietnam but fled to the U.S. in 1981, where he started a family, earned a doctorate and built a career in IT in Sacramento, California. Mr. Truong, also born in Vietnam, emigrated in 1979 and settled in Honolulu, Hawaii, becoming a citizen in 1985.

At the time of their arrest, Messrs. Nguyen and Truong allegedly were preparing to distribute pamphlets on nonviolent resistance. An official newspaper in Hanoi said they were found with 7,000 leaflets along with envelopes and postage. They had also brought into the country a new Vietnamese translation of “From Dictatorship to Democracy,” a nonviolence handbook published by the U.S.-based nonprofit, nongovernmental Albert Einstein Institution. Also arrested at the house were a French citizen, a Thai man and several local Vietnamese activists.

Hanoi’s continuing persecution of human-rights advocates of all kinds is bad enough. But the jailing of two Americans is made worse by the fact that it’s part of a pattern. In August 2006, Hanoi arrested another U.S. citizen, Cong Thanh Do, for similar activism. He was released and deported back to the U.S. more than a month later, but only after he went on a hunger strike and Members of the U.S. Congress protested his jailing.

In March of this year, Hanoi arrested yet another activist with ties to the U.S., Le Quoc Quan. A Vietnamese citizen, he was detained just days after returning home from a congressionally sponsored fellowship at the National Endowment for Democracy in Washington. He was freed in June after pressure from the U.S. government.

Hanoi may hope that such arrests will deter overseas Vietnamese from meddling in domestic politics, but if that’s the case it doesn’t seem to be working. According to Mai Huong Ngo, Mr. Nguyen’s wife, her husband was aware of the risks but decided to go anyway. “He loves Vietnam,” she told us last week, and as a naturalized citizen of a free country, “he deeply appreciates freedom.” “I know for sure my husband didn’t do anything wrong,” she said, adding that she hopes she and her two teenage children see her husband again by Christmas.

The U.S. embassy in Hanoi has finally been granted consular access to Messrs. Nguyen and Truong, although only after a long delay. Congress is again protesting, as it has even in cases where the dissidents were not U.S. citizens. After the Nov. 17 arrests, Reps. Loretta Sanchez, Zoe Lofgren and Neil Abercrombie signed an open letter to Secretary of State Condoleezza Rice asking her to press Hanoi for the Americans’ release. In Mr. Nguyen’s case, Hanoi initially responded by pretending that it didn’t know he’s a U.S. citizen — for more than a week after the arrests, state media reports described his nationality status as “unknown.” At least now the authorities have dropped that pretense.

Vietnam’s accession to the World Trade Organization and President Nguyen Minh Triet’s June visit to the White House were significant steps in the process of forging better ties with the U.S. Yet with closer economic relations will come tighter political scrutiny and demands for accountability. If Hanoi wants to stay in Washington’s good graces, imprisoning Americans for peaceful activism is a particularly bad way to do it.

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After China, Vietnam Will Be World’s Factory : Opinion

http://www.bloomberg.com/apps/news?pid=20601039&refer=columnist_mukherjee&sid=aDjL0As_b1h4

By Andy Mukherjee

Dec. 6 (Bloomberg) — The 4 million motorcycles on the streets of Ho Chi Minh City offer a remarkable — if somewhat noisy — testimony to the prosperity that beckons Vietnam.

A $900 Honda may not be everyone’s idea of affluence. However, it has the same pride of place in this rapidly industrializing nation as a bullock cart in an agrarian society.

Young men and women — many of them migrants from rural areas — commute to large, modern factories on the outskirts of the city on bikes they are proud to own and scared to lose.

This mobility is so crucial to the workers’ productivity that some employers in the city formerly known as Saigon have even begun buying insurance, at their own expense, against the risk of bikes being stolen from their factory premises.

Investors who take the boom in Vietnam’s two-wheeler market as a harbinger of a burgeoning mass market may be disappointed for a few years. Those who see the lust for bike ownership as a sign of Vietnam’s young labor force yearning for the tools it needs to plug into a global supply chain will win.

After China, Vietnam is emerging as the world’s next factory of choice for labor-intensive goods.

One can see that in the changing composition of the country’s exports. Rice and coffee — two of Vietnam’s biggest agricultural exports — are now becoming less significant to the $61 billion economy than textiles. Footwear shipments are gaining prominence over seafood.

Furniture Capital

The other fast-growing export industry is furniture.

Exports of wood-based products have grown 24 percent from last year to more than $2 billion.

James Koh, a Singapore businessman, makes dining tables and chairs in Vietnam for customers around the world, including Williams-Sonoma Inc.’s Pottery Barn stores in the U.S.

Koda Ltd., of which Koh is the managing director, also has factories in Malaysia and China. Yet, it’s Vietnam’s lower costs that are prompting the company to expand capacity here by 25 percent.

“The labor cost in Vietnam is half that of China, while worker productivity is about the same,” says Koh.

Starting next year, the government will increase the mandated minimum wage for foreign-funded companies in Ho Chi Minh City and Hanoi, the national capital, by 13 percent to 1 million Vietnamese dong ($62), a level that is still affordable, Koh says.

Ready to Compete

Chinese-made goods have become increasingly expensive in the U.S. for the past six months. That gives Vietnamese manufacturers an opportunity to win a bigger share in their largest export market.

The ingredients are in place.

Vietnam’s accession to the World Trade Organization in January has provided its textile industry with quota-free access to the U.S. Joining the WTO regime has also caused a 37 percent surge this year in overseas investment commitments to $13 billion.

The biggest draw of the country is clearly its labor.

The median age in Vietnam is 25 years. The workforce isn’t just young, but also literate and healthy: The proportion of people who are undernourished has been cut in half over the past three decades.

The risk for Vietnam is inflation, which accelerated to 10 percent last month, the fastest pace in three years.

Inflation Risk

In the short run, Vietnam must stand ready to sacrifice some economic growth to halt the increase in prices, especially of construction material.

If left unchecked, inflation will become a drag on Vietnam’s competitiveness even if the central bank doesn’t allow the dong’s nominal exchange rate to appreciate.

On the whole, though, Vietnam is on the road to prosperity.

The swanky Louis Vuitton and Gucci showrooms that have sprung up in Ho Chi Minh City may be a bit premature in a country where the annual per-capita income was $723 last year.

The time for the Vietnamese consumer will undoubtedly come.

With a population of 85 million, and an economy that the International Monetary Fund forecasts to grow more than 8 percent this year and next, the Southeast Asian country will soon represent a sizable domestic market.

For now, the Vietnamese producer is the bigger opportunity.

There is, however, no room for complacency.

Cheap labor makes it relatively easy for a country to enter the global supply chain, but it has to work hard to stay in.

Increasingly Complex

Especially now, when a seemingly simple task like attaching four legs to a rectangular piece of American poplar wood and shipping it back to the U.S. has become too complex to undertake without overseas capital and expertise.

First, there is a minimum investment in technology without which large orders from retailers are impossible to win. Each of the Taiwanese-built assembly lines that Koda is installing in its new Vietnam factory costs $300,000.

Second, buyers in Europe are demanding more exacting environmental standards from their vendors, such as minimum use of packaging material, Koh says. Americans, meanwhile, are getting fussy about making all shipments terror-proof.

Most importantly, no retail store — European or American — wants a sweatshop scandal at any of its suppliers’ units.

Like most developing countries, Vietnam is dogged by corruption and red tape. It must strive to improve its record now that it’s getting the investments it needs for the workers to graduate from motorcycles today to cars in the future.